Chrysler Loses Nearly $3 Billion in Two Months, Daimler Report Says
February 28, 2008

We knew Chrysler was burning madly through cash; now we have a sense of at what rate. Sort of. It appears it may be worse than we even thought.

Chrysler LLC reported a loss of about $2.8 billion in August and September of last year, according to Daimler AG’s annual report, filed with the U.S. government Wednesday.

The loss includes restructuring expenses that actually took place in the fourth quarter and cost related to a concessionary labor contract Chrysler negotiated with the UAW.

The recent figure is even higher than those previously given by Daimler and Chrysler executives.

• In October, Daimler’s own third-quarter results issued said Chrysler had lost $1.23 billion for the past nine months.

• Chrysler CEO Robert Nardelli told employees at December meeting the company was tracking at a loss of $1.6 billion for the year and the company was operationally bankrupt. He later backpedaled on the bankruptcy comment, noting investors have pumped $10 billion into the company’s hoped-for turnaround.

• Earlier this month an attorney representing Chrysler in a dispute with supplier Plastech said in court the automaker lost $1.5 billion in 2007.

Publicly traded Daimler still owns 19.9 percent of Chrysler, thus is required to provide financial reports to investors. Private-equity firm Cerberus Capital Management, which owns 80.1 percent of Chrysler, does not have to release financial figures for the automaker.

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