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Chrysler wants Congress and the new administration to understand something. It will cut its business costs as much as necessary, even if it risks going out of business. The firm gets the message that it is better to bleed to death than to go to the federal government with a survival plan that has too high a cost base.

According to The Wall Street Journal, "The auto maker, which is getting $4 billion in emergency loans, aims to submit a restructuring plan that shows how Chrysler plans to shrink its operations in response to the steep decline in auto sales in the last six months." That may mean chopping its white collar workforce down to only the most crucial personnel, closing more plants, working with the UAW to tear down labor costs, and perhaps even cutting some models.

The move carries tremendous risks. Chrysler's share of the US market is estimated at about 12%. It has no big overseas operations like GM (NYSE:GM) and Ford (NYSE:F) do to help its earnings. If it cannot do well in the America, it cannot do well at all.

Chrysler's largest risk, aside from going into bankruptcy in the next few months, is that its market share continues to drop and falls so far that it cannot even manage to carry the most modest costs of designing and building cars. It will have reduced itself out of existence.

GM has the advantage of a 21% market share in America and huge businesses in Europe, South America, and China. But, the largest US car company cannot go back to the government without being able to demonstrate that every last labor and manufacturing cost has been sacrificed. Even the smallest bit of fat could cost the company its independence.

Douglas A. McIntyre is an editor at 247walls.com.

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