Chrysler Receives $1.5 Billion from the US Department of Treasury

US-based automaker Chrysler announced on January 16 that it has received access for up to $1.5 billion in loans from the US Department of Treasury's Troubled Asset Relief Program, also known as TARP. The funds are part of the government assistance approved in December 2008 and will provide the necessary liquidity to support Chrysler Financial's retail finance program, the American company said in a press statement.

“We appreciate the Treasury Department’s support and their commitment to increase the availability of financing for consumers,” said Thomas F. Gilman, Vice Chairman and CEO – Chrysler Financial. “This funding will provide us with increased capacity to help Chrysler LLC and our dealers make new loans available to qualified consumers and sell more cars and trucks."

“This funding will better position us to withstand the current economic challenges until funding becomes available through more traditional commercial sources,” added Gilman.

Chrysler, one of the American struggling carmakers, said in October 2008 that it needs government financial support in order to minimize loses caused by the economic downturn and revamp production line. After several rumors claiming the company may not be able to make payments to suppliers and dealerships, which obviously coincides with bankruptcy, Chrysler and General Motors received $17.4 billion in low-interest loans in December, with the United States government demanding the two companies to concentrate on fuel-efficient and environmentally-friendly engines.

And Chrysler is indeed more interested in these engines, with even more speculations saying the American carmaker plans to discontinue several models, and even sell a couple of brands in order to concentrate on certain vehicles that could revamp its sales.