Chrysler Says US Goverment Loans Needed To Speed-up Auto Technologies
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AUBURN HILLS, Mich., Sept 23, 2008; Kevin Krolicki reporting for Reuters wrote that Chrysler LLC Chief Executive Bob Nardelli said on Tuesday that without a low-cost government loan package, the automaker would be forced to cut costs more deeply to free up funds for electric car technology.
Chrysler also said it planned to bring an electric vehicle to market by 2010, about the same time when General Motors Corp rolls out its all-electric Chevy Volt plug-in car.
The automaker showed off the prototypes for three electric vehicles -- one based on its popular minivan, one based on a Jeep SUV, and an all-electric sports car.
Chrysler executives said the decision has not yet been made on which vehicle it would manufacture first or where production would be based.
Nardelli told reporters that without the $25 billion loan package now before Congress, Chrysler could be forced to cut more jobs to fund the investment for the new vehicles.
"All of us have worked very hard to change the break-even point in our business. Unfortunately we've had to furlough many families as a result of the economic turmoil and the downward spiral in our industry," Nardelli told reporters at an event outside Chrysler's headquarters in Auburn Hills, Michigan.
"I'd like to make sure we don't have to go further to be able to support this advanced technology work," he said.
Nardelli said he was "very confident" in Chrysler's business plan and liquidity position.
"We are razor focused on liquidity and cash," Nardelli added. "We are focused on returning to profitability."
Chrysler's U.S. sales were down 25 percent so far this year -- the largest drop for any of the major automakers. Light trucks account for nearly 70 percent of Chrysler's volume at a time when consumers are moving toward smaller and more fuel-efficient vehicles.
Chrysler, controlled by private equity firm Cerberus Capital Management since 2007, has faced scrutiny over both its liquidity and its ability to invest in emerging electric and hybrid car technology.
Company executives said Tuesday's event was intended to show how much development work the company's ENVI unit has done since the No. 3 automaker showed off electric car prototypes at the Detroit Auto Show in January.
Nardelli and other Chrysler executives said the company's goal was to offer a full range of electric vehicles over time.
Nardelli said the automaker chose to convert its existing minivan and Jeep platforms as part of the effort because that would be cheaper and faster than trying to develop a new platform as GM is doing with the Volt.
Editing for Reuters by Maureen Bavdek