Fiat Spa

The Obama administration on Monday gave Chrysler Corp. an ultimatum: join forces with Italy's Fiat within 30 days or prepare to enter Bankruptcy Court. Over the weekend, the president's automotive task force concluded that Chrysler couldn't survive on its own, despite the $4.3 billion that taxpayers have pumped into the company since December. The Auburn Hills, Mich., firm, which announced in January that it was in merger talks with Fiat, had asked for a $5-billion loan.

A quarter of a century after saying arrivederci to America, Fiat may be poised for a U.S. comeback. The huge Italian conglomerate, which sells vehicles under the Fiat, Alfa Romeo, Lancia, Maserati and Ferrari nameplates, has been looking for a tie-up with another carmaker for some time. After reported discussions with the French company that makes Citroen and Peugeot appeared to go nowhere last year, Chrysler may be its next dance partner.

In what is expected to be the last hurdle in Chrysler's effort to rapidly emerge from bankruptcy, a federal appeals court will hear arguments today on whether the automaker can sell itself to a new company run by Italian manufacturer Fiat. A federal bankruptcy judge approved the government-orchestrated deal earlier this week, but its completion is being delayed after three Indiana pension and construction funds filed an appeal. In hundreds of pages of documents filed Thursday in the U.S.