| DaimlerChrysler, the world's second | | | | Chrysler will be taken over by the new |
| largest producer of luxury cars and | | | | company. |
| manufacturer of high quality Mercedes | | | | Why sell Chrysler? The merger was not |
| window motors has announced recently | | | | working from the very beginning as a |
| that the first quarter profit that they | | | | matter of fact DaimlerChrysler's stock |
| obtain is more than doubled and Mercedes | | | | peaked five months after the merger and |
| has helped a lot in offsetting the loss | | | | never recovered since then. Chrysler |
| at the US Chrysler Group which is being | | | | lost $680 million last year and |
| sold. | | | | surrendered market share to Toyota and |
| The net income of DaimlerChrysler has | | | | was relying too much on the sluggish |
| increase to 1.97 billion euros ($2.67 | | | | North American market. Zetsche has |
| billion), or 1.89 euros a share from 781 | | | | failed to keep Chrysler profitable after |
| million euros or 77 cents explained | | | | the reorganization which he himself has |
| Chief Financial Officer Bodo Uebber at a | | | | started. |
| recently held conference call. Revenue | | | | Since 1998 Chrysler has posted annual |
| also decline by 6 percent to 35.4 | | | | profits of only $5 billion while its |
| billion euros. The company gain from the | | | | losses escalate infuriating investors |
| sale of stake in the parent of Airbus | | | | further. The latest recorded loss by |
| SAS. | | | | Chrysler marks a third descent into |
| Chief Executive Officer Dieter Zetche is | | | | losses since the last time that Lee |
| further attempting to reduce the risk to | | | | Iacocca saved the automaker from |
| profit growth by finally selling | | | | bankruptcy 25 years ago. To keep itself |
| Chrysler AG to Cerberus Capital | | | | afloat Chrysler has reduced its |
| Management LLC. Zetsche is expecting for | | | | workforce by 13,000 and closed one of |
| more than 7 percent profit increase for | | | | its factories. It has also unveiled new |
| this year at Mercedes, which has | | | | models in the hope to offset the decline |
| introduced new and expensive vehicles | | | | in sales last 2006. |
| like the S-class sedan. DaimlerChrysler | | | | Chrysler CEO Tom LaSorda has again vowed |
| is also expecting to keep the truck unit | | | | to get Chrysler back to profitability |
| profitable. | | | | since now he has all the time to really |
| The shares increase by 1.84 euros or 3 | | | | focus on the recovery of the automaker |
| percent to 63.54 euros valuing the | | | | without the distractions from analysts |
| company at 65.5 billion euros. The stock | | | | and the need to submit quarterly |
| has also increased by 29 percent since | | | | reports, according to Cerberus Chairman |
| February 14 when Zetsche said that "all | | | | John Snow in an interview just recently. |
| options' were open for Chrysler. | | | | The buck stops here Uwe Treckman, an |
| The Separation DaimlerChrysler has | | | | equity strategist at Dresdner Bank said, |
| finally announced that it would be | | | | "Once Chrysler has been sold the |
| ending its nine-year ownership of the | | | | cash-flow to sales-ratio will improve |
| money losing Chrysler and would be | | | | significantly." |
| handing control to Cerberus including | | | | The Mercedes Car Group will also |
| the $19 billion retirement liabilities | | | | implement a profit recovery plan that |
| for US employees. Ron Gettelfinger, the | | | | will include Smart, Mercedes-Benz and |
| President of the United Auto Workers | | | | Maybach brands especially now that |
| have welcomed the deal and promised to | | | | Chrysler will finally separate from |
| help in the recovery of the ailing US | | | | them. The growing demand for heavy |
| carmaker. | | | | trucks in Europe and Asia are also |
| It can be remembered that Chrysler has | | | | helping to offset the loss Chrysler. |
| posted a loss in the quarter amounting | | | | Mercedes-Benz earnings before interest |
| to 1.49 billion euros from a profit of | | | | and tax were 792 million euros in the |
| 641 million euros. The loss includes | | | | quarter from a loss of 735 million euros |
| reorganization expenses of 941 million | | | | a year earlier. |
| euros. DaimlerChrysler also shared 120 | | | | For the first quarter, Mercedes-Benz Car |
| million euros to assist "troubled | | | | Group sales declined by 2.8 percent |
| suppliers" and added 54 million euros to | | | | trailing behind larger rivals like the |
| cut administration and management jobs. | | | | Bayerische Motoren Werke AG and |
| In addition, existing projects with | | | | Volkswagen AG's Audi luxury car |
| Mercedes-Benz will also continue, | | | | business. Despite the decline, |
| providing opportunities to share | | | | Mercedes-Benz is still able to come up |
| development costs. There will also be a | | | | with remarkable sales figures for its |
| joint council consisting of management | | | | most expensive vehicles like the S-Class |
| board representatives that be formed to | | | | full-sized sedan and the GL-Class large |
| discuss business projects. The deal is | | | | sport utility vehicle which has given |
| expected to be completed in the third | | | | the brand more profit compared to its |
| quarter. The Pension as well as the | | | | other models. |
| health-care costs associated with | | | | |