Chrysler Group talked about some jazzy vehicles in the long-winded rollout of its five-year plan Wednesday, but the biggest shock came not from styling and interiors, but from dollar signs: The company said it is solvent and profitable.
CEO Sergio Marchionne said Chrysler had $5.7 billion on hand at the end of September, up from $4 billion June 10, when the company was formed from partnering the best assets of the old Chrysler with Italy's Fiat Group to emerge from Chapter 11. Fiat -- for its expertise, but no cash -- got a 20% stake and control.
Chrysler also had an operating profit of $200 million in the third quarter, he said -- earnings before taxes, interest payments and depreciation.
How? Marchionne, also CEO of the Fiat Group, said the new Chrysler is "very parsimonious."
The automaker gave assurances that it will post ongoing profits by 2011. And in a radical departure from the industry's usual secrecy, laid out its product intentions through 2014. The moves were meant to keep Chrysler out of the obituary columns until it can boost sales and earnings and regain momentum.
It must come across as vigorous and viable, or people won't buy its products and lenders won't lend. Wednesday could have been a last chance.
Chrysler, of course, has had many last chances: In the 1970s, when it had no high-mileage small cars at a time of fuel shortages. In the 1980s, when the company was broke but didn't say so and CEO Lee Iacocca worked for $1 a year while persuading the government to guarantee loans. In the '90s when Daimler-Benz pretended to merge with Chrysler while plotting instead to absorb it.
But now it has seemingly exhausted government -- that is, the taxpayers' -- patience and, in fact, has nowhere to turn.
For all that's at stake, for all the earnestness of the Chrysler presenters vowing better quality, improved customer  relations, quicker new-model introductions, higher fuel economy, better dealers, the Wednesday session didn't satisfy everybody.
The upbeat presentation featured almost no models, photos or even computer drawings of the vehicles that are to save the company. And the discussion of dollars was too optimistic for some.
"We have only the barest hint" of what's coming, noted Joe Phillippi, head of AutoTrends Consulting, who attended the session at Chrysler's headquarters in Auburn Hills, Mich.
"Everything needs to go perfectly," cautioned Rebecca Lindland, director of auto research at consultant IHS Global Insight, also at the presentation. "We definitely have some concerns when we look at their financials and market share numbers. We think they are being really aggressive." (continued...)
© 2009 USA TODAY under contract with MarketWatch. All rights reserved.
|
Rackspace: It makes a difference when you focus on support.
House Lawmakers Push Ban on Peer-to-Peer Software
GAO: Los Alamos Computer Security Has Weaknesses
Computer Security Firm Fortinet Plans IPO This Week
Flat Shipments Hurt Dell Despite Increased Earnings
New Pogoplug 'Personal Cloud' Does Social Networking
Apple Tablet Rumored Delayed as Publisher Gears Up
Review: $100 Palm Pixi Is Stylish But Sluggish
TV on the Go Leaves a Little To Be Desired
AT&T Fires Back at Verizon with 'X and V' Commercial
Smartphones: A Bigger Target for Security Threats
FBI Says Hackers Targeting Law Firms, PR Companies