Delays in Chrysler’s bankruptcy proceeding led to fears that key models like the 2011 Jeep Grand Cherokee may be delayedEnlarge Photo
Objectors to the deal had included a group of Indiana pension funds holding secured debt, some of the 789 dealerships Chrysler plans to reject, and consumer groups. They had argued that Chrysler was moving too quickly, that the sale violated bankruptcy principals and that the company was needlessly closing hundreds of its dealerships.
The Supreme Court rejected their challenge, stating that the objectors "have not carried the burden" to justify such action and that the court's action was not a decision on the merits of the underlying legal issues alone. The only alternative to approving the sale would have been the immediate liquidation of the automaker, reports Automotive News.
Chrysler, as well as the Obama administration, urged the Supreme Court to allow the sale to go forward and said a long delay could either kill the deal or worsen its chances of viability, potentially jeopardizing more than 38,000 jobs.
In the lead up to its bankruptcy, Chrysler was forced to close all of its plants and leave thousands of vehicles, engines and components unfinished. This led to the fears that important model launches, like the redesigned Jeep Grand Cherokee and next-generation Chrysler 300, could be delayed.
The sale of Chrysler’s assets to the newly established Chrysler Group is expected to take place by June 15, a date that couldn’t come sooner as it’s estimated that the delays are costing Chrysler upwards of $100 million a day.