When Julius Caesar crossed the Rubicon in 49BC, on his way to Rome to start a civil war, he is reported to have said: “The die is cast.”
For the Obama administration, the driving force behind Chrysler’s chapter 11 bankruptcy, the significance of Chrysler’s engineered demise is similar. Analysts have forecast wide-spread turmoil across the industry as a result, though none has yet predicted civil war.
The key to the success of the measure is the smoothness of the passage through bankruptcy. GM, Ford and workers across the US are concerned that if the wind-down becomes disorderly then Chrysler will bring down its suppliers on the way out, and that could take them out as well.
Fiat has been lined up to take a 20 per cent stake in the bankrupt Chrysler, the UAW would get just over half, and the balance would go to the US government.