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Wednesday, May 20, 2009
Chrysler's Bankruptcy Calls Iacocca's Cars Into Question
By Eric Spinato, Jeff Flock and Joanna Ossinger
FOXBusiness
Chrysler’s Chapter 11 bankruptcy filing has affected even Lee Iacocca, the man who famously helped pull the auto maker
out of bankruptcy.
Chrysler claims bankruptcy law doesn’t allow companies to provide former executives with vehicles -- and Iacocca currently
has a minivan and a Chrysler 300 furnished by the company.
FOX Business has obtained a letter sent to former Chrysler executives and directors, in which the company requests that they
either buy the vehicles they’re currently driving at fair market value or turn in the vehicles. To read the letter,
scroll down.
Iacocca’s office confirms it has received the letter.
Chrysler had issued a statement on the matter:
“Bankruptcy law does not allow Chrysler LLC to continue providing former executives and Directors with use of a Company Furnished
Vehicle. In addition, the proposed transaction with Fiat does not contemplate reinstituting the program in the future. As
a result, Chrysler has informed program participants of their options to either purchase their vehicle at fair market value
by securing personal financing or turning their vehicles in to the Lapeer Road Marshalling Center (or to a local dealership
if they do not reside in Southeast Michigan).
We regret the need to take this action but it is important that the Company be in compliance with the requirements of bankruptcy
law.”
Iacocca was the former Ford Motor executive who became CEO of Chrysler in 1979, and subsequently turned around the company
with the help of $1.5 billion in loan guarantees from the federal government. Chrysler paid off the loans in 1983, a full
seven years early, and to this day that episode is regarded as one of the greatest corporate turnarounds of the past several
decades.
Iacocca retired from Chrysler in 1992, and since then has done charity work, among other things. In 2007, he published a book,
“Where Have All the Leaders Gone?”
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