Senator Urges Merger Deal for Chrysler

By SHARON TERLEP

A Senate critic of the Big Three auto makers said on Tuesday that he remains convinced Chrysler LLC needs to merge with another car company.

Sen. Bob Corker (R., Tenn.) said at the North American International Auto Show, "My hope is that they will in fact merge and be again a viable part of Michigan and our country."

Sen. Corker became a leading critic of an auto-industry bailout in hearings late last year by voicing the view that Chrysler's owner, private-equity group Cerberus Capital Management LP, wanted a bailout so it would have time to sell the company.

After the Senate rejected a bill providing loans for General Motors Corp. and Chrysler, the Bush administration granted the companies a $17.4 billion aid package from the $700 billion fund set up to help ailing financial institutions.

Chrysler has seen its sales plunge in the past three months, and nearly ran out of money before getting federal aid. Despite its troubles, Chrysler Chief Executive Robert Nardelli said on Sunday that the company isn't being prepped for a sale.

Sen. Corker may have less influence in the new Congress with an increased majority for the Democrats. But his tough words suggest GM and Chrysler may be in for another bruising if they go back to Washington to ask for more loans, as is expected.

While touring the GM, Volkswagen AG and Chrysler exhibits at the Detroit show, Sen. Corker said visiting the auto show and seeing the vehicles Detroit is capable of producing only makes him "more convinced we need to cause these companies to get their capital structure competitive."

Write to Sharon Terlep at sharon.terlep@dowjones.com