More BS from the Moron CEO of Chrysler

From: Stlaurent Mr Steven (STLAURENTS@mctssa.usmc.mil)
Date: Tue Dec 26 2000 - 12:22:30 EST


Steve Comments: More BS from the puppet CEO. To Dieter- you are nothing
but a puppet for the bigger idiot Schrempp. When Schrempp said, "...piss on
your-self, you would..."

Dieter Zetsche says profits come before market share, and he is trying to
get the
                         good products in the studio into the marketplace
sooner and at a lower cost. That's the recipe
                         for a Chrysler turnaround.

                                                   The new chief executive
and president of DaimlerChrysler North
                                                   America, on the job for a
month, also told reporters he is looking
                                                   for greater opportunities
for Mercedes-Benz and Chrysler to
                                                   share parts, components
and architecture, so long as it doesn't
                                                   make the cars look or
seem alike.

                                                   And though he didn't say
so, his main objective is to save
                                                   his boss's job.

                                                   How did Chrysler come to
lose an estimated $1.7 billion in
                                                   the second half of the
year? Zetsche says the company's
                                                   fixed costs were too high
and assumed continued growth
                         and price increases.

                         "The reality of the marketplace turned out to be
much different," said Zetsche. "Sales are
                         only softening now, but we have had pricing
pressure for some time now."

                         The 47-year-old former head of Daimler's commercial
truck
                         business said rumors that he is bringing in dozens
more
                         Germans to replace Americans, and that he is
halting new
                         vehicle programs, are false. "This would be
stupid," said
                         Zetsche.

                         Clash of the cultures

                         The CEO with the cookie-duster mustache said he has
                         been greeted warmly by employees, which surprised
him. "I
                         think the worst thing is uncertainty," said
Zetsche.

                         He also said he felt there was no clash between
German
                         and American cultures to worry about. "I have
spoken to
                         people here, as well as to people at BMW and I
don't
                         believe it is an issue." Zetsche added somewhat
comically,
                         "Lee Iacocca was of Italian descent. Bob Lutz is
Swiss.
                         Francois Castaing is French and Jim Holden is
Canadian.
                         It is no issue."

                         That may be wishful thinking, but he is not likely
to dwell on
                         such matters with the press, the last constituency
he has
                         spoken with after employees, union reps, dealers
and
                         suppliers.

                         Zetsche said the struggling U.S. automaker will
restructure
                         in six cost and revenue areas, and take an
unspecified
                         charge next year to help it return to its "lean and
mean''
                         past.

                         The restructuring will focus on material, plant and
fixed
                         costs, as well as investigating all operations for
cost
                         savings and studying the revenue management and
                         product strategy side. Details of the plan will not
be
                         presented until Feb. 26.

                         "We have it all in place to get back to where we
were, to
                         become known again as a lean and mean company, a
                         dolphin among whales and sharks,'' Zetsche said.

                         Layoffs on the horizon?

                         Chrysler lost $512 million in the third quarter and
                         DaimlerChrysler Chairman Juergen Schrempp said in a
                         letter to shareholders on Monday that the unit
would lose
                         about $1.25 billion in the fourth quarter. Analysts
don't
                         expect Chrysler to show a profit next year, either.

                         Zetsche said DaimlerChrysler will take a charge
next year
                         as part of the restructuring, but he said it was
too early to
                         say how much the charge would be. The restructuring
plan
                         must impress shareholders who have seen the market
                         value of Chrysler evaporate like gas fumes in
Daimler's
                         hands, and it must win over analysts who have
knocked
                         down Daimler's credit rating, making it more costly
to
                         borrow.

                         Zetsche's boss, chairman Juergen Schrempp, has also
laid
                         the tracks for a huge layoff, telling employees
that it is
                         staffed for a company with a 20-percent market
share, not
                         the 14.5 percent it currently has. "That analysis
isn't exactly
                         right," said Zetsche.

                         Schrempp handed Zetsche not only a financial and
                         operational turnaround to execute, but a political
morass to
                         navigate after the chairman blithely told a London
                         newspaper last month that he snookered Chrysler's
                         management and organized labor two years ago into
                         thinking they would be 'equal partners' in the
merger that
                         was always just one of Daimler's acquisitions to
build
                         Schrempp's global vision.

                         About recovering morale at the company after
Schrempp's
                         now infamous comments, Zetsche simply said, "It
does us
                         no good to look to the past except to learn from
our
                         mistakes."

                         While he says the reason for the merger of the
companies
                         are as valid today as they were two years ago, he
                         concedes, "We did not expect problems of this
magnitude."

                         Zetsche is going to need the help of the United
Auto
                         Workers to achieve his turnaround. He said he is
meeting
                         with the UAW and CAW to see where the unions "can
help
                         the situation." But he quickly added, "We won't do
our
                         negotiating in the media."

                         The current UAW contract prevents the company from
                         selling off operations to raise cash or lower
costs, but an
                         ambiguous clause allows the automaker to reduce
                         employment levels if sales drop dramatically. That
could put
                         the Zetsche in the unsavory position of having to
engineer a
                         greater sales drop than the market is creating on
its own in
                         order to pare union headcount.

                         A scenario that has the UAW smelling blood, though,
is a trade. If the UAW gets a free
                         hand in unionizing Daimler's non-union Alabama auto
plant and Freightliner truck
                         facilities, the union may be willing to grant some
concessions on the Chrysler side of the
                         business.

                         With regard to incentives, Zetsche, who once ran
sales and marketing for
                         Mercedes-Benz, said he would like to eventually
restructure incentives to get away from
                         cash-back and cut-rate leases as the company did on
the Mercedes side.

                         "But I'm not entirely stupid," says Zetsche. "You
can't make rules today to break
                         tomorrow."

-------------------------------------------
Steven St.Laurent
Test Engineer
Test Branch, GSD, MCTSSA
MARCORSYSCOM, USMC
760-725-2506 (DSN 365-2506)
Work:mailto:stlaurents@mctssa.usmc.mil
Home:mailto:saint1958@home.com



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