| Subject: |
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Chrysler For Sale; the latest. |
| Name: |
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MoparNorm |
| Date Posted: |
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Mar 7, 07 - 5:57 PM |
| IP Address: |
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71.104.147.157 |
| Email: |
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moparnorm@hotmail.com |
| Message: |
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Breaking up Chrysler would be hard, CEO says
Automaker’s loan and leasing arm might be easier to spin off
Wednesday, March 07, 2007
Mark Landler
NEW YORK TIMES
DaimlerChrysler AG Chairman Dieter Zetsche said all options for the unprofitable U.S. division are still being considered.
GENEVA — The chief executive of DaimlerChrysler, Dieter Zetsche, said yesterday that it would be difficult to break up Chrysler, as analysts and other outside experts have speculated in recent weeks, because of an integrated production system that binds together its various brands.
"Chrysler Group is very integrated," Zetsche said in an interview at the Geneva Motor Show. "The technical lines, like platforms, do not go along the same lines as the brands. The less they are aligned with the brands, the more difficult it would be to think of any separation."
Zetsche emphasized that he was making an observation, not commenting on options for how DaimlerChrysler might sell the Chrysler unit, a prospect it confirmed three weeks ago that it was considering. But his statement seemed to reinforce reports that DaimlerChrysler hopes to unload Chrysler as a single unit, rather than pull out single brands such as Jeep.
Zetsche did open the door to spinning off Chrysler Financial, its loan and leasing arm, saying "there are different models" of how to organize the financing arm of an automaker, among them, separating it from the home company.
Speculation about Chrysler’s future has been at a fever pitch since Feb. 14, when Zetsche confirmed that DaimlerChrysler was keeping all options open for its American unit, which lost $1.5 billion last year. The company has since been silent about its plans, which made Zetsche’s appearance in Geneva the show’s most avidly watched event.
For Zetsche to be scrutinized as a dealmaker rather than a "car guy" is a new and somewhat awkward role for him. He normally relishes these shows as a chance to indulge in some showmanship. A few years ago, he shattered a glass wall with an electric guitar to promote a new Chrysler model.
Yesterday, however, Zetsche kept his inner rock star under wraps. Sitting with his hands folded on a table, as two public-relations executives monitored his remarks, he stuck to formulaic pronouncements about seeking "the most promising future for the Chrysler Group."
Yet there were hints in his answers of the flurry of activity that is taking place behind the scenes, as DaimlerChrysler scouts for potential buyers, which have been reported to include General Motors, autoparts suppliers like Magna International and privateequity investors.
Zetsche also showed palpable frustration with Chrysler’s union, the United Automobile Workers, which last fall refused to grant DaimlerChrysler the same concessions on health care that it granted to Ford and General Motors. It said the company’s profitability did not warrant such a giveback.
He declined to comment on recent reports that two privateequity firms, Cerberus Capital Management and Blackstone Group, had contacted DaimlerChrysler about Chrysler. But he obliquely challenged fears expressed by one union leader of a private-equity buyout of Chrysler.
Buzz Hargrove, the president of the Canadian Auto Workers union, said in an interview in The Washington Post yesterday that a sale to private-equity investors would be the "worstcase scenario" for Chrysler.
MN
Sounds like a private equity deal that would save Chrysler, is the unions worst nightmare? The same intergration of Chrysler units is also present between Mercedes and Chrysler, so what's the real story? |
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