Merry Christmas!
Posted on 12/20/2007 10:39:10 PM PST by BurbankKarl
Chrysler LLC has slipped into a serious financial crunch just four months after Cerberus Capital Management LP swept in to save the auto maker.
At a meeting earlier this month, Chief Executive Robert Nardelli told employees the company is headed for a substantial loss this year and is scrambling to sell assets to raise cash, according to an account by two people present that Mr. Nardelli confirmed.
"Someone asked me, 'Are we bankrupt?'" Mr. Nardelli said at the meeting. "Technically, no. Operationally, yes. The only thing that keeps us from going into bankruptcy is the $10 billion investors entrusted us with."
In an interview yesterday, Mr. Nardelli acknowledged making the comment, saying it was intended to "convey a sense of urgency" among employees.
Cerberus is often viewed as among the shrewdest of the private-equity groups reshaping America's industrial landscape. But the Chrysler acquisition is turning into a case study of how deals made during the recently ended boom are going sour.
Cerberus's secretive chief, Stephen Feinberg, essentially paid nothing to DaimlerChrysler AG (now Daimler AG) for an 80.1% stake in Chrysler. He agreed to put $5 billion into Chrysler, and $1 billion into its financing unit. Cerberus secured $10 billion from investors to pull off the deal. Mr. Feinberg's goal was to spiff up the company and sell it or list its shares for a huge profit -- a feat Cerberus had pulled off many times before.
(Excerpt) Read more at online.wsj.com ...
Nardelli. Enough said.
they are as bankrupt as a lot of the purchasers of their vehicles
United Auto Workers better negotiate for more retirement funds, again.
There have been a spate of stories about Chrysler lately.
The fact remains that Cerberus knew they had $10 billion to last Chrysler 3 years and that they must show some progress.
The company is on track to break even or make money next year.
The reason for all the negativity in the press is that Cerberus is led by conservatives.....Feinberg, Dan Quayle, John Snow are just examples of who is running this company.
The media cannot stand to see conservatives in charge of a company and so they are writing as many stories as possible to destroy them.
I know they may come out healthier, but you need to listen to this:
http://wjr.com/Article.asp?id=532168&spid=6525
It is a 19:00 minute clip, but the flavor of it is we will not recover as a state until 2012.
There are days I thin that is optimistic.
Chrysler products were known for dismal quality. (Inside information from reliable sources: Chrysler salesmen hate their product.)
The UAW is one of the chief culprits here. Ford with their homosexual agenda is next.
“they are as bankrupt as a lot of the purchasers of their vehicles”
I dunno. We’ve had our Dodge Caliber for a year now. Love it!
Pump and dump. As an investment, Chrysler stock has near-zero potential.
Still, there’s quite a bit of value in Chrysler’s branding portfolio. The equity that trademarks like Charger, Barracuda, and Ram possess has got to be substatial. I expect a Chinese or Indian automaker will eventually buy the Chrysler brands and use them to market their cars to U.S. buyers.
Ditto. Chrysler products used to blow—the K-Cars come to mind. However, their current line up is really exciting. I have had a Sebring since 2003—best car I ever owned. Last year, I brought a Dodge Charger—love the look, though it mostly stays in the garage (no fault of the car’s though). Next time I need another four-wheel drive, I will buy the Nitro (assuming Chrysler is still around).
Merry Christmas!
I have no idea why you posted that here, but I’m OK with it.
That was my first reaction. He must be one of the world's luckiest idiots.
Oops! Meant to post it at the skiing thread! Hey! it’s early and I’m a lech!
Yup..gonna be a big problem...
I have had a chance to talk to their American competition who have seen their cars torn apart for competitive durability test.
One particular individual mentioned smart allocation of resources, such as interior amenities emphasized vs. a trailing wagon axle to save money on the Mini-Van.
At the same time lack of quality and durability and general cheapness of parts was very evident.
This maybe not a formula for success going forward.
RE: Chrysler’s dismal quality, my old Dad is just shopping for a used, half-ton, 4WD truck. Toyota and Nissan too rare, GM has ‘99-’03 “Net Build” piston slap, and ‘99-? Ford Tritons often strip & pop sparkplug hole #3 because the cast aluminum head’s got a light spot. I’m telling him to get a Dodge.
Our ‘05 T & C was purchased with a 7/70 extended warranty.
We will trade it in at 69K.
That should be about 2010 - probably get something smaller to save on $6.00 gas.
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