UPDATE 1-Chrysler readying "viable" turnaround plans


DETROIT, Nov 26 (Reuters) - Chrysler [CBS.UL] is prepared to meet "accountability and viability" criteria requested by Congress as a condition for considering a government bailout for the auto industry, Chief Executive Bob Nardelli said.

U.S. lawmakers, while dismissing a blank check approach to the cash crisis facing the auto industry, agreed last week to give them another chance to make their case for a rescue, asking for the submission of restructuring plans by Dec. 2.

"The company ... is ready to share our plans for returning Chrysler to profitability as we move beyond this unprecedented financial crisis," Nardelli said in a memo to employees that was obtained by Reuters.

Congress is scheduled to reconvene out of session in the week of Dec. 8 to review the plans and consider aid for General Motors Corp , Ford Motor Co and Chrysler LLC, which is owned by private equity firm Cerberus Capital Management.

Nardelli said in the memo that Cerberus had made it clear it would forgo any benefit to be created from any government assistance that Chrysler may obtain.

Government loans, if provided, would be used to support Chrysler's ongoing operations, including obligations to pay wages and suppliers, fund health care and pensions and to continue future product development, Nardelli said.

He repeated that Chrysler had burned through $3 billion in cash during the third quarter, leaving the automaker with about $6.1 billion by the end of September.

"This situation shows the urgency of our need to control costs and continue to find ways to increase revenues," he said.

As part of efforts to survive a downturn and emerge as a "leaner and more agile" company, Nardelli said Chrysler would continue to look for alliances and partnerships with other automakers and suppliers.

Nardelli had previously said that without production and sourcing tie-ups with GM and Ford, Chrysler would have to seek an alliance with an overseas automaker like the one between Renault SA and Nissan Motor Co .

Chrysler will also release more information regarding changes to its operations beginning in December.

"With a smaller team to face this difficult business environment, the company must once again adapt to its new realities," Nardelli said. (Reporting by Soyoung Kim; Editing by Ted Kerr)



Follow Us

Sponsored Introduction Continue on to (or wait seconds) ×