NBC news has confirmed that Chrysler is preparing for a possible bankruptcy filing as soon as next week.
The news comes as President Obama hailed Detroit's transformation earlier this week.
The President is giving Chrysler until next week to resolve its $7 billion dollar debt.
The administration and Chrysler have reportedly struck a deal with Chrysler's lenders to at least partly protect worker pensions and health care if the company does have to declare bankruptcy.
Bad news from GM, too. The carmaker will shut down 13 plants for nine weeks or more over the summer as it tries to sell off cars and save money.