A three-member federal appeals court panel in New York is expected today to hear final arguments on whether Chrysler can sell itself to a new company run by Italian auto manufacturer Fiat in an effort to emerge from its rapid bankruptcy reorganization.
The closing is being delayed after three Indiana pension and construction funds that currently hold approximately $42 million in secured loans to Chrysler filed an appeal.
Chrysler is arguing that the courts recognized that a sale like the current situation the auto manufacturer is seeking is justified in emergency situations.
“Allowing the sale to proceed expeditiously serves the interests of the Debtors, their stakeholders and the country at large,” Chrysler noted.
Meanwhile, multiple owners of Chrysler dealerships slated to be closed appeared in federal court in lower Manhattan to plead their case.
One dealership scheduled to close is the only Chrysler dealership in New Orleans that rebuilt after being destroyed by Hurricane Katrina.
“It would be complete financial devastation,” Comiskey said, if the dealership closes. “I’d probably be living in my car.”
U.S. Bankruptcy Judge Arthur Gonzalez said there was a “strong argument” to allow Chrysler to close the dealerships, but said he would hear all the testimony before ruling no earlier than Tuesday of next week.
According to some dealership owners slated to close, Chrysler is still delivering cars for sale to them.
Chrysler hopes to exit bankruptcy by next week, allowing it to tie up with Fiat SpA.