Chrysler Bankruptcy Impacts Disabled, White-Collar Retirees - Even Iacocca

Iacocca While you hear a lot about how the UAW's blue-collar, hourly employees are making concessions during Chrysler’s restructuring bankruptcy, what you don't hear about is the impact on other employees. All of Chrysler's white-collar pensions could become insolvent if a bankruptcy judge approves a new Chrysler-Fiat company as early as today.

Famed Chrysler executive Lee Iacocca is one of nearly 20,000 non-union Chrysler retirees whose pensions are at risk of being completely emptied. Iacocca, like other former Chrysler executives, also receives a Chrysler vehicle for life. Well, that benefit is definitely no longer in effect, and the company is repossessing the minivan and sedan Iacocca had been driving. Still, that perk is nowhere near as important as the pensions due all white-collar retirees. That obligation could fall on a government-funded pension agency that could immediately be overwhelmed by Chrysler and GM obligations.

Also taking a hit are the 233 Chrysler employees currently on disability who get no benefits during bankruptcy. Company spokesmen say that when the new Chrysler emerges it will reinstate the disability payments, but when exactly that will be is unclear.

Iacocca losing pension, car in Chrysler bankruptcy (Reuters)
Disabled Chrysler workers wait for benefits (Oakland Press)

By David Thomas | May 29, 2009 | Comments (6)
Tags: In The News

Comments 

Maxwell

Iacocca can offer to pay Chryasler fair market value for a used vehicle from a bankrupt company that does not enjoy a stellar rep for quality and can't seem to give away its new cars.

I'd guess that 10 bucks for each car should cover it.

Paul

Wow,and I thought Iacocca personally paid for them.During his 2008 lifetime award from Chrysler,he stated he had a 300C and minivan in his garage.He never said he "owned" them,just had them in the garage.I guess he wasnt lying.With all his money,he should be able to buy something new.Or at least afford a used 88 K-car.

Paul

Did "Operation Repo" do the repo job on Iacoccas vehicles? Thats one episode I want to see.

Stellar

As bad as Chrysler has gotten over the years its still sad that people are being affected like this, sure we're quick to jump on their car quality but all the stories written about Chrysler going bankrupt, I've read very very few comments about the people it affects. I am going to say, it wouldnt've gone this far if their designers/engineers did a MUCH better job, instead of trying to cut corners.

Happymantis

Stellar,
I'm not sure if I would blame the engineers and designers over the current woes of the domestic auto industries, I would place the blame squarely on the shoulders of the executives who decided to cut corners to increase profits and guarantee fat bonuses for themselves, and to a lesser degree, I would blame the unions.

Fred

Stellar, you are an idiot. Engineers and designers have no say whatsoever in design, cost, sources, or anything. Management calls all the shots. They are told what to do and how to do it. We only offer options, mngt picks the one they want. I know because I am a big three engineer...

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