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post #1 of 1 (permalink) Old 02-29-2008, 09:36 PM Thread Starter
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Chrysler exec defends performance, plans

From the Detroit Free Press:

Chrysler exec defends performance, plans
By JUSTIN HYDE • FREE PRESS BUSINESS WRITER • February 29, 2008


NEW YORK -- Chrysler Vice Chairman Jim Press said Friday the automaker had made an “operational” profit since it was acquired by Cerberus Capital Management, and defended comments from Cerberus founders that only small changes were needed for a profit on their stake.

Press also said while the U.S. auto market would likely remain weak into the first quarter of 2009, Chrysler’s turnaround was progressing as planned, and challenged the verdict from Consumer Reports on Thursday that ranked the automaker’s products last among its peers.
In a talk sponsored by the Levin Institute, Press challenged reports based on financial figures from Daimler AG suggesting a $2.9-billion loss in the first two months since selling a majority of Chrysler to Cerberus in August 2007. The Free Press reported Friday that Chrysler’s own figures seemed to indicate a $2.9-billion loss for all of 2007.
“Since the acquisition operationally, we haven’t lost money,” Press said. “Operationally, we’ve made a profit. We’re ahead of all our targets established by Cerberus when they made the acquisition.”

The Levin Institute is the business-education arm of the State University of New York.
Press, who left Toyota Motor Corp. after three decades to become Chrysler’s vice chairman following the Cerberus purchase, said the company was moving ahead on plans to focus engineering and sales on fewer models, and to expand overseas. He said Detroit automakers needed to adjust their businesses and stop expecting sales to rebound to historic levels.
“The domestic auto companies are not going to have a majority of the market here. … We've got to find way to become a responsible company addressing what we are today, not what we want to be,” Press said. “If we don't do that, the market and the level of competition in this industry could force us to a situation where a lot more of our associates could be painfully affected.”

He said he spoke at least a few times a month with Stephen Feinberg, the founder of Cerberus, who told investors in January that the fund didn’t need to fundamentally improve Chrysler to make a good return on its investment.
“What he means is what we’re doing,” Press said. “We don’t have to chase to be a 10 million or 12 million (vehicle sales) company, and we don’t have to have 80 or 90 vehicles in our portfolio. We can be the best little car company in America.”

Press said the Consumer Reports overview, which criticized Chrysler on quality and design, was “a picture of the past.” The influential magazine recommended only four Chrysler models, and said the company was lagging far behind Asian competitors.
“What they haven’t been able to do is get their arms around the future of our products and the improvements we’re making,” Press said. “We’re making those in light-speed time.”
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