Chrysler owes creditors $6.9 billion with loans secured by Chrysler assets (factories and technology). Last week they rejected an offer from the Obama administration's Auto Task Force for 15 cents on the dollar. A new counter proposal came out Monday that's reportably drawing criticism from the Obama Administration.
The new proposal has creditors seeking a 40% stake in the Fiat-Chrysler partnership, a seat on the company's board of directors and demands Fiat put $1 billion cash into Chrysler. This will be in exchange for writing off about a third ($2.4 billion) of the $6.9 billion in loans.
According to the new counter proposal, if Fiat doesn't inject $1 billion in cash into the deal "there is the prospect of a wealth transfer from the U.S. taxpayer to a foreign company of potentially $10 billion or more."
bailout money would be spent entirely on Chrysler and none of it would find it's way to Fiat. He also said all loans would be paid back. "Nothing is going to be taken out of the US and the main objective is going to be to repay every single dollar of taxpayer funding before anybody gets anything".