Auburn Hills — Fears that the Chrysler LLC bankruptcy announced Thursday could devastate Michigan and harm Chrysler workers and retirees nationwide were abated somewhat as details of the deal were released.
“It’s the best deal we can come up with,” said Mark Conner, who works at Chrysler’s plant in Toledo, Ohio. “Anything else that could have happened would be worse.”
President Barack Obama announced Thursday that Chrysler would head into bankruptcy with the aid of up to another $8 billion in taxpayer money, a last-resort attempt to quickly restructure the struggling automaker.
He blasted hedge-fund creditors who he said held out for a richer deal.
Those holdouts also drew anger from workers, who agreed to more concessions to save the automaker.
“Everybody expects the autoworker to take a pay cut,” Conner said. “Nobody else wants to take a pay cut.”
But he and other autoworkers, politicians and community leaders were glad to hear the deal will keep workers’ pensions and health care benefits secure.
Gov. Jennifer Granholm was on campus Thursday to talk about the bankruptcy and its implications for the state.
“For us as a state, this means we have a path to success,” Granholm said at a news conference in the Communication Arts and Sciences Building. “This agreement announced today, despite the bankruptcy … means the jobs will stay here.”
In a Thursday conference call with reporters, Sen. Debbie Stabenow, D-Mich., called the bankruptcy “an opportunity for Chrysler to remain
in Michigan.”
Stabenow also blasted the holdout creditors for hoping to potentially benefit from a Chrysler bankruptcy, “rather than focusing on what was best for tens of thousands of Americans.”
Democrats in the Michigan House of Representatives passed a resolution Thursday calling on the state to pull investments out of the funds that refused to keep Chrysler out of bankruptcy. The resolution also called on other states to do the same.
Following Obama’s announcement, Chrysler said it temporarily will idle manufacturing starting Monday as part of the restructuring, which includes signing a partnership with the Italian company Fiat.
Steve Grabowski, a worker at Chrysler’s Warren Stamping Plant for the past seven years, said managers told workers around 1:45 p.m. Thursday to go home.
He was told employees were being laid off indefinitely and would be eligible for unemployment starting Monday.
“We knew something like this was going to happen, but we didn’t think it would be so soon,” said Grabowski, 33, of Roseville.
Many communities and companies that rely on Chrysler plants remained nervous that tax revenues will continue to shrink. Michigan already has the nation’s highest unemployment rate, 12.6 percent, and state economists are estimating current budget could face a $1.3 billion deficit.
Chrysler is looking to substantially reduce its 3,200 auto dealerships, something it should be able to do through bankruptcy.
Staff writer Jeff Kanan contributed to this report.
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