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Chrysler executive says automaker is on track to meet financial goals

Chrysler executive says automaker is on track to meet financial goals

Jim Press, vice chairman and president of Chrysler LLC, said Friday the privately held automaker will meet its financial targets and shrink itself by trimming jobs and dropping models despite expectations of a continued slump in U.S. vehicle demand.
Speaking to industry analysts and journalists in New York, Press said Chrysler had an operating profit after Daimler AG's sale of a controlling stake in the automaker in August to New York-based Cerberus Capital Management LP.
"Cerberus is actually doing well as an organization, and even more importantly, contrary to a lot of things that have been reported, our company is doing very well financially," Press said.
"We've been in an operating profit situation since the acquisition, and we've exceeded all the targets that were established when the acquisition took place."
Chrysler lost about $2.7 billion (euro1.78 billion) on a net basis in the two months after Daimler sold the 80.1 percent interest in the automaker to Cerberus, Daimler said in annual report earlier this week. The figure, for the period from Aug. 4, 2007, to Sept. 30, was calculated under international financial reporting standards used in Europe and not under U.S. accounting standards.
Press declined to provide his own figure, saying that as a private company, there's no incentive for Chrysler to release financial results.
Daimler also said that, on a net basis, Chrysler lost 870 million euros, or roughly $1.2 billion (euro0.79 billion) for the full year in 2007 when converted at the euro-to-dollar exchange rate that Daimler reported for the third quarter. It was unclear how much of Chrysler's fourth-quarter results were included in the figure because neither Daimler nor Chrysler would answer questions about the report.
Press said the automaker's leadership is focused on slimming the company to reflect annual sales of about 2.5 million vehicles, down from levels of 4 million to 5 million in years past.
As part of the process, Chrysler is cutting thousands of jobs, eliminating models and consolidating its dealer network.
Chrysler, which has previously sold the bulk of its vehicles in North America, also wants to recreate itself as global automaker by designing new vehicle models for particular international markets, Press said.
But that doesn't mean it plans on getting bigger, he said.
"Global doesn't mean huge. Global means really well-focused, high-value, high-quality, really well-targeted products in many markets," Press said.
He pointed to BMW as proof that a small automaker can do business on a global scale. "Given our ownership and given our strength, we're really well suited for that," Press said.
Press said that in light of the current economic environment, he expects 2008 to be a tough year for the automotive industry as a whole, projecting industry vehicle sales of about 15.5 million for the year, down from about 16.1 million in 2007.
Though Press said he expects much of the drop in demand to come in the less profitable area of fleet sales, he doesn't expect overall sales to start picking up until the first quarter of 2009.


Updated : 2021-08-04 03:27 GMT+08:00