Who do you know that has the cash to buy a car company? Someone who needs instant brand recognition and an entry in the US auto market?
Daimler Chrysler Confirms Chrysler Talks
By MATT MOORE, AP Business Writer
BERLIN - DaimlerChrysler AG is confident a turnaround program at its Chrysler unit will return the beleaguered American brand to profitability, but Chairman Dieter Zetsche said Wednesday the automaker is in talks with unidentified potential buyers.
"As announced on Feb. 14, we are open to all options for future collaboration with Chrysler," he told some 9,000 shareholders crammed inside Berlin's exhibition center. "The statement is still true today."
He said that the talks have been with "potential partners who have shown a clear interest" and "so far, I am satisfied with the process. Everything is going according to plan."
He would not elaborate on who was involved in the talks.
Zetsche stunned the automotive world on Feb. 14 when he said that continued losses and fierce competition in the United States meant that the German-American automaker was considering all options for its Chrysler unit, and did not rule out a possible sale, saying only that all options were being considered.
He did not disclose whether any decision to sell Chrysler had been made or if the company was any closer to a solution. Still, he did say a recovery plan that will cut 13,000 jobs in the U.S. and Canada was moving forward.
The Chrysler unit lost $1.5 billion in 2006.
"The crucial factor was the unforeseeable shift in demand to smaller, more fuel-efficient vehicles which was triggered by increased gas prices in the U.S.," Zetsche said. He noted that Chrysler's strengths have been minivans, pickups and sport utility vehicles, autos not known for their fuel efficiency. Read the rest.
Poor 'ol Chrysler. Always a distant third except on the street or track. It was back in the early seventies that Lee Iacocca brought them back from near death. The era of American muscle cars was over and a long period of darkness was descending on Detroit. Chrysler was in financial trouble and its new CEO, with nowhere else to turn, had to go hat in hand to Congress and beg for the money to keep the company afloat. The problem then as now, was soaring fuel prices. The entire country debated whether it was appropriate for the Government to get involved in the largest bailout in US history but Mr. Iacocca convinced Congress to loan him the money necessary to return the company to the black. He paid off the loan early and then lead the nations efforts to refurbish the Statue of Liberty in time for the July 4, 1976 celebration. Mr. Iacocca made a lot of money for himself and became the iconic American success story.
I wish Chrysler well. It's unfortunate that the company is being traded around like this especially in light of the fact that they made the minivan ubiquitous.