The US Treasury Department said on Friday it would provide a US$1.5 billion loan to Chrysler LLC’s financing arm and the automaker announced it will immediately use the money to offer zero-percent financing on several models and expand lending to car buyers with less than ideal credit.
The Treasury said the new aid is in addition to the US$17.4 billion in loans earmarked for Chrysler and General Motors Corp last month in an effort to buy time for the two companies to reorganize and ultimately return the domestic auto industry to profitability.
“This funding will better position us to withstand the current economic challenges until funding becomes available through more traditional commercial sources,” Thomas Gilman, Chrysler Financial’s vice chairman and chief executive, said in a statement.
Ford’s financing arm, Ford Motor Credit, has been in discussions with Treasury officials in an effort to tap into funding from the government’s Term Asset-Backed Securities Loan Facility spokeswoman Margaret Mellott said on Friday.
Ford, like Chrysler, is waiting on a decision from the Federal Deposit Insurance Corp on whether it can become an industrial loan corporation. That would allow the government to guarantee its debt and make it more appealing to investors.
Chrysler vice chairman and president Jim Press said the new loan will allow Chrysler Financial to provide more customers with affordable financing.
Battered Chrysler saw its sales plunge 53 percent last month, far worse than for GM or Ford Motor Co, and analysts have said it probably won’t survive the year as an independent company — despite the US$4 billion loan it received from the government. Chrysler had been counting on an additional US$3 billion in aid for Chrysler Financial.
Chrysler Financial will report to Treasury on its use of the money and other financial information, but government officials may block some of the details from public disclosure, the official said.
Unlike GM and Ford, Chrysler is owned by a private equity firm, Cerberus Capital Management LP, and is not required to publicly release details of its finances.
GM’s financing arm, GMAC LLC, which is also controlled by Cerberus, received US$5 billion from the Treasury Department late last month.
Tropical Storm Gaemi strengthened into a typhoon at 2pm yesterday, and could make landfall in Yilan County tomorrow, the Central Weather Administration (CWA) said yesterday. The agency was scheduled to issue a sea warning at 11:30pm yesterday, and could issue a land warning later today. Gaemi was moving north-northwest at 4kph, carrying maximum sustained winds near its center of up to 118.8kph and gusts of 154.8kph. The circumference is forecast to reach eastern Taiwan tomorrow morning, with the center making landfall in Yilan County later that night before departing from the north coast, CWA weather forecaster Kuan Shin-ping (官欣平) said yesterday. Uncertainty remains and
SEA WARNING LIKELY: The storm, named Gaemi, could become a moderate typhoon on Wednesday or Thursday, with the Taipei City Government preparing for flooding A tropical depression east of the Philippines developed into a tropical storm named Gaemi at 2pm yesterday, and was moving toward eastern Taiwan, the Central Weather Administration (CWA) said. Gaemi could begin to affect Taiwan proper on Tuesday, lasting until Friday, and could develop into a moderate typhoon on Wednesday or Thursday, it said. A sea warning for Gaemi could be issued as early as Tuesday morning, it added. Gaemi, the third tropical storm in the Pacific Ocean this typhoon season, is projected to begin moving northwest today, and be closest to Taiwan on Wednesday or Thursday, the agency said. Today, there would likely
DISRUPTIONS: The high-speed rail is to operate as normal, while several airlines either canceled flights or announced early departures or late arrivals Schools and offices in 15 cities and counties are to be closed today due to Typhoon Gaemi, local governments announced last night. The 15 are: Taipei, New Taipei City, Taoyuan, Tainan, Keelung, Hsinchu and Kaohsiung, as well as Yilan, Hualien, Hsinchu, Miaoli, Chiayi, Pingtung, Penghu and Lienchiang counties. People should brace for torrential rainfall brought by the storm, with its center forecast to make landfall on the east coast between tonight and tomorrow morning, the Central Weather Administration (CWA) said. The agency issued a sea warning for the typhoon at 11:30pm on Monday, followed by a land warning at 11:30am yesterday. As of
CASUALTY: A 70-year-old woman was killed by a falling tree in Kaohsiung as the premier warned all government agencies to remain on high alert for the next 24 hours Schools and offices nationwide are to be closed for a second day today as Typhoon Gaemi crosses over the nation, bringing torrential rain and whipping winds. Gaemi was forecast to make landfall late last night. From Tuesday night, its outer band brought substantial rainfall and strong winds to the nation. As of 6:15pm last night, the typhoon’s center was 20km southeast of Hualien County, Central Weather Administration (CWA) data showed. It was moving at 19kph and had a radius of 250km. As of 3pm yesterday, one woman had died, while 58 people were injured, the Central Emergency Operation Center said. The 70-year-old