Word: chryslers
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Dates: during 1970-1979
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...plan is intended to prove that Chrysler can be brought back to financial health and is thus eminently deserving of federal aid. The document outlines a five-year strategy. Although President Lee lacocca had said earlier that Chrysler's third-quarter deficit would be "at least double" the $207 million that it reported for the second quarter, bringing the cumulative red ink for the year to about $800 million, the report projected that the total 1979 loss would come to a truly scary $1.073 billion on revenues of $12.4 billion. The company expects to lose another $482 million next...
...even with the bank borrowings lined up by Chairman John Riccardo and cost-cutting measures that have already saved $650 million, Chrysler will still face a cash shortage of $2.1 billion between now and 1982. The company has "some confidence," the report says, that it can raise $900 million, probably through further sales of assets and some breaks on wages, prices, and loans from its unions, suppliers and banks. But the remaining $1.2 billion will have to come from the Government in the form of an immediate loan guarantee of $500 million and a $700 million "contingency" loan guarantee because...
...Chrysler will remain a full-line auto and truck producer. Among other options it says it rejected was to make only small cars; given its high fixed costs and the low prices it would have to charge, it would lose $43 for every such car produced in 1982. But the company does plan to reduce the number of basic car lines from five to three. Moreover, by 1985 all Chrysler cars will have front-wheel drive, a space-saving feature that only its fast-selling, American-built Omni and Horizon subcompacts have now. The company's basic goal...
...buttress the pitch for Government aid, the report features a somewhat lurid accounting of what would happen if the company went bankrupt. The total cost to the nation, Chrysler says, would be $16 billion. Some 400,000 workers could not only lose their jobs, but they could also remain unemployed long enough to require unemployment benefits totaling $1.5 billion. As many as 35,000 workers, most of whom are black, could be laid off in Detroit alone. Yet these estimates seem exaggerated, because it is highly unlikely that the company would ever shut down totally. At worst some plants would...
...report also suggests that burdened as it is with the high costs of meeting Government regulation and its own indebtedness, Chrysler is not a realistic candidate for merger. As lacocca protested earlier last week, "Nobody's asked...