Chrysler Targets $1000 per Vehicle Savings Built With More " Imported" Parts

BEIJING, Nov 18, 2006; Reuters reported that the head of the Chrysler unit of DaimlerChrysler (DCXGn.DE: Quote, Profile, Research) said on Saturday the company will target cost cuts of $1,000 per vehicle by increased outsourcing beyond North America and other savings.

"We are willing to import with the focus on being competitive," Chrysler head Tom LaSorda told reporters at the Beijing International Automotive Exhibition.

He said that over the next 6-12 months, the company would identify cost reductions averaging $1,000 per vehicle, with part of that coming from outsourcing.

He did not specify where the outsourcing would be done, saying: "we are going to source where we can get good low-cost components and high quality."

LaSorda also said the company would focus on increasing sales outside North America, where it has typically generated 85-91 percent of sales.

Separately, LaSorda noted the company was in talks with China's Chery and one other non-Chinese company about a production alliance, but he gave no further details.

DaimlerChrysler, the world's fifth-biggest carmaker, maintained its 2006 profit forecast after strong third-quarter profits at Mercedes and its truck business helped absorb a 1.16 billion euro ($1.46 billion) loss at Chrysler.

The group was rigorously reviewing what steps were needed to rescue profits at Chrysler while it launches a string of fuel-efficient cars to energy-conscious buyers.

U.S. rivals General Motors and Ford have also struggled in their home market as Asian car makers claim market share by offering fuel-efficient alternatives to the pickup trucks and sport utility vehicles that Detroit has come to love. (US$=7.87 yuan)