PBGC Offers Reassurance about Chrysler Bankruptcy

April 30, 2009 (PLANSPONSOR.com) - Vince Snowbarger, acting director of the Pension Benefit Guaranty Corporation, said Chrysler's entry into Chapter 11 bankruptcy protection does not change the status of its defined benefit pension plans.

In a statement Snowbarger issued assurance that “[t]he plans remain ongoing under the sponsorship of Chrysler, and are insured by the Pension Benefit Guaranty Corporation.  As the bankruptcy process unfolds, the PBGC will work with Chrysler, its unions, and all other stakeholders to ensure continuation of the pension plans. “

In April, the agency announced a term sheet agreement with Daimler AG on what it called “additional protections” for the pension plans of Daimler’s former Chrysler North America division (see PBGC Strikes Deal with Daimler ).

Workers and retirees who are concerned about their benefit and the impact of a possible pension termination are directed to a special Chrysler information page at http://www.pbgc.gov/workers-retirees/chrysler.html

As he was outgoing, the former PBGC director, Charles E.F. Millard warned that while the three big automakers’ pension programs are OK for now, they are still extremely worrisome (see Outgoing Pension Insurer Director Cautions about Carmaker Shortfalls ).