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December 2, 2008 11:55:32 AM CST

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Chrysler Faces Cash Crunch

Posted Dec 21, 07 10:09 AM CST in Business 

(Newser) – With an auto industry novice as CEO, a product line trailing the rest of the industry, and an inadequate cost-cutting strategy, Chrysler is scrambling to sell assets to climb out of a deep financial hole. Four months after Cerberus Capital Management took the automaker private, the Wall Street Journal finds turnaround plans stalled by a cash crunch.

The acquisition may become the first case study of how deals made in a boom economy can go bust when slowdowns hit. CEO Robert Nardelli, the former Home Depot chief, told employees recently the company is headed for a $1.6 billion loss this year, adding that only the $10 billion Cerebus invested is keeping Chrysler from bankruptcy.

Source Wall Street Journal

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Chrysler Sebring automobiles wait for transport from the Sterling Heights Assembly facility in Sterling Heights, Mich., Thursday, Nov. 1, 2007. Chrysler LLC said Thursday it plans to cut up to 12,000...   (Associated Press)
Bob Nardelli (R), the new CEO and chairman of Chrysler LLC and Ron Gettelfinger, president of the United Auto Workers stand onstage during a day of events held to celebrate the official sale of Chrysler...   (Getty Images)
A row of unsold 2008 Jeep Wranglers sit at a Chrysler/Jeep dealership in the southeast Denver suburb of Centennial, Colo., Sunday, Nov. 4, 2007. Nervous consumers are expected to make November another...   (Associated Press)
Jeep Grand Cherokees and Commanders are shown being staged for transportation on truck and train at the Chrysler Jefferson North Assembly facility in Detroit, Thursday, Nov. 1, 2007. (AP Photo/Paul Sancya)   (Associated Press)
Bob Nardelli (R), the new CEO and chairman of Chrysler LLC, is introduced to the media at a news conference during a day of events held to celebrate the official sale of Chrysler to Cerberus Capital Management...   (Bill Pugliano/Getty Images)
Bob Nardelli, the new CEO and chairman of Chrysler LLC   (Getty Images)
The Chrysler logo is shown on the podium at a press conference during a day of events held to celebrate the official sale of Chrysler to Cerberus Capital Management at Chrysler world headquarters August...
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auto industry • Chrysler • Cerberus Capital Management • Robert Nardelli • Stephen Feinberg


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