Chrysler Tops Peers in Bankruptcy Risk, JPMorgan Says

Chrysler LLC is the most likely of the three U.S. automakers to file for bankruptcy protection in the next two years, JPMorgan Chase & Co. said, citing a panel discussion among credit-rating companies.

General Motors Corp. is the next most likely and Ford Motor Co. is the least, JPMorgan analyst Himanshu Patel wrote in a report today, quoting discussion yesterday by analysts from Standard & Poor's, Moody's Investors Service and Fitch Ratings. S&P and Moody's both cut Chrysler's credit one level on Aug. 7, seven steps below investment grade.

“There seemed general agreement, too, that a filing by one of the Detroit three would be negative, on balance, for the remaining two companies,'' Patel wrote. The fallout would include a drag on new-car prices and trade-in terms, he said.

Chrysler Chief Executive Officer Robert Nardelli said in April that the closely held company wouldn't have a net profit in 2008. The Cerberus Capital Management LP unit's U.S. sales fell 23 percent this year. Bloomberg