The news of the U.S. government's full support for the proposed Fiat Chrysler alliance to now be enacted was broken by President Barak Obama in a televised address last night; his administration has driven forward the restructuring talks and will pump in billions of dollars in loans to assist the struggling firm through the next few months.

Addressing the TV cameras Obama, who had imposed the April 30 deadline, said: "One month ago I spoke about some of the problems of the crisis in the auto industry and the necessary steps that have been taken to give one of the most storied automakers Chrysler a new lease on life." Remembering the carmaker's long history and its firm part of the nation's landscape he said that Chrysler "helped make the 20th century an American century" and praised "the ingenuity and industriousness, of the American people" in building the big three auto firms.

However he was also quick to address its recent decline saying that while Chrysler was "a pillar of our industrial economy" it was however "a pillar that has been weakened by papering over tough problems and avoiding hard choices. Too long Chrysler moved too slowly to adapt to the future," the Democrat President continued, "designing and building cars that were less popular, less reliable and less efficient that foreign competitors."

Obama said he would only "invest taxpayers' dollars" in Chrysler if "a real fix" could be found. The first plan submitted by Chrysler at the end of March had been rejected as being unworkable but Obama believed that "if Chrysler can work a partnership with Fiat, Chrysler could have a bright future." After he rejected the first plan Obama said he gave the two firms an additional 30 days to come up with a new proposal and that "the standard I set them was high, I challenged them to design a plan that would protect American jobs." He said that the future looked more promising now: Chrysler and Fiat have formed a partnership that has a strong chance of success."

He praised all the key stakeholders for their efforts, saying that "seeming insurmountable obstacles have been overcome" and that "major sacrifices" have been made. "The partnership," noted the first-term President, "will save more that 30,000 jobs at Chrysler and tens of thousands of jobs at suppliers, dealers and other businesses." He continued by saying that "the federal government will make additional loans" (amounting to the previously announced offer of US$6 billion). He honoured everyone who has dug deep to make the survival of Chrysler happen. "This partnership was only possible of unprecedented sacrifices from Chrysler's stakeholders, taking cuts that will help Chrysler survive" and this meant that "so many workers keep their jobs and 170 thousand retirees keep their healthcare."

He mow expects Chrysler press ahead quickly with plans to "build green fuel efficient cars that are the future of the industry" noting that "as part of this agreement Fiat has already agreed to transfer billions of dollars of cutting edge technology." Obama then added that "every dime of taxpayer money will be repaid before Fiat can take a majority stake."

Obama acknowledged that "several major financial institutions led by JP Morgan" had settled for a cash sum of less than one third of their original loans; however he was forthright in his summary of the creditors that wouldn't budge as they pressed for a bigger return. "In particular a group of investors and hedge funds held out for an unjustified settlement, some demanded twice the return that other lenders were getting." He was unhappy that while most of the stakeholders had dug deep, "Daimler agreed to give up its stake and contribute to the company's pension plan," he cited as an example, turning to the investors and hedge funds that had refused to agree to take the US$2 billion on the table he has firm in his comments that "I don't stand with them I stand with Chrysler's, employees, managers, and suppliers who are getting Chrysler back onto a path to success. I don't stand with those that held out when everyone else was making sacrifices."

The President, who earlier this week celebrated his first 100 days in office, believes that the Chapter 11 bankruptcy process will be short, sharp and the best way forward. "Because the UAW [United Auto Workers] and many of the banks, the biggest stake holders have aligned, have already agreed, this process will be quick, efficient." He believes that at the end of it "Chrysler will emerge stronger and more competitive." Obama added that "I know some will insist that bankruptcy even for these limited purposes is a step that should not be taken" but "it was unacceptable for a small group of group of investors to hold out." He also added that GM's captive finance division, GMAC will now come into the Chrysler picture. "GMAC," Obama stated, "has agreed to finance new Chrysler sales, we will be providing additional funds to GMAC to unlock the frozen credit markets," while noting that the government will continue to underwrite all warrantee claims on new vehicles.