How The Chrysler Bankruptcy Can Cause Other Bankruptcy Filings
As everyone knows, Chrysler Motors filed for protection under Chapter 11 under Title 11 of the United States Bankruptcy Code last month.
As part of its reorganization plan, the company is closing many dealerships.
In fact, according to the Los Angeles Times, Chrysler gave notice of closing 789 of its dealerships across the country. General Motors is taking similar steps to close even more of its dealerships. Thousands of workers will suddenly be unemployed and may need to file bankruptcy themselves.
This obviously can have a chilling effect on the economy. This is not just limited to Detroit where manufacturing takes place. This is in your neighborhood.
But, like forest fires are a natural and necessary event (those not started by humans anyway), bankruptcy can offer a fresh start in the same way as reforestation does after a fire. Sometimes we all need to just throw in the proverbial towel and start over, and fortunately, our bankruptcy laws allow us to do that (with certain restrictions, of course).
The employees of Chrysler, General Motors, and those similarly situated should take stock of their financial situation and consult with bankruptcy counsel about their options in the wake of this unfortunate set of circumstances.
Image by Keijo Knutas
