Auburn Hills (WWJ) -- Rumors that Chrysler plans to file for bankruptcy are not true, according to a company spokeswoman. The rumors were so prevalent Thursday that the company was forced to issue a statement.
Shawn Morgan says the rumors are false and without merit. She says they do not reflect the privately owned company's financial situation.
The rumors apparently originated in Europe and follow Tuesday's action by Chrysler to exercise a $2 billion line of credit from Cerberus Capital Management LP and Daimler AG.
Morgan says the automaker had to borrow the money before Aug. 3 under terms of Cerberus' purchase of an 80 percent stake in Chrysler from Daimler in August of 2007.
Meantime, former Chrysler Chairman Lee Iacocca says the struggling automaker will survive its current woes, just as it did when he helped save it from bankruptcy in the early 1980s.
"I think we have a great future ahead of us in this company," Iacocca told WWJ's Jeff Gilbert and a select group of reporters. "It's independent, it's now time to show your stuff..you have no alibis."
Iacocca spoke Thursday at an employee rally at the company's Auburn Hills headquarters.
Current Chairman Bob Nardelli took the stage with the 83-year-old Iacocca, calling him "a great American'' to the cheers of onlooking employees on three levels surrounding the building's atrium.
Iacocca became chairman in 1979 and helped the automaker stave off bankruptcy during a severe auto downturn, retiring in 1992. But he clashed with company management in 1995, backing billionaire Kirk Kerkorian's hostile takeover bid.
Chrysler merged into DaimlerChrysler in 1998, before private buyers relaunched it as Chrysler LLC in 2007.
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