Earlier today, automotive analysts blamed a large chunk of Daimler's Q4 profits downturn on its remaining 19.9 percent share in Chrysler. According to their calculations, Chrysler inflicted a $2.7b drag on Daimler. Although Market Watch duly reported that "the German automaker cautioned against making that calculation, citing the differences between international and U.S. accounting," Chrysler PR switched into damage control. An email pointed-out that the results are for Chrysler Holding LLC, which includes both the automotive and financial services operations. What's more, that accounting thing is a big deal. "There are significant differences between IFRS and U.S. GAAP accounting standards. Major differences include the effects of the acquisition of Chrysler Holding LLC by Cerberus, including recent restructuring actions by Chrysler LLC and the accounting for pension costs under the 2007 UAW contract. Accordingly, the 2007 financial results of Chrysler LLC under U.S. GAAP are substantially better than the IFRS-based financial results utilized by Daimler." Chrysler flackmeister Katie Hepler told TTAC that ChryCo "enjoyed positive operational earnings during Q4." So what about CEO Bob Nardelli's statement back in December that his employer was "operationally bankrupt?" No comment.
10 Comments on “Chrysler Claims “Postive Operational Earnings”...”
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Unfortunately, since Chryslerberus is not a public company, we will never know if “positive operational earnings” is the same as profit until the fire sale comes.
How do they keep from falling down with all the spin?
What does 2+2 equal? Whatever you want it to.
That Katie’s a riot! And so is Nardelli. What a brilliant man.
I think there’s some purchase accounting discrepancies regarding goodwill. Namely, what kind of tax break could Cerberus get for donating Chrysler to Goodwill?
C’mon ash78, you’re making everyone look (because I’m laughing out loud – VERY loud – right in the office). Keep up the good work.
“the German automaker cautioned against making that calculation, citing the differences between international and U.S. accounting,”
“There are significant differences between IFRS and U.S. GAAP accounting standards…”
True dat. That’s why know one has been able to account for the cash hoard Chrysler had before Daimler took over.
Is the Doctor Strangelove acronym (P.O.E.) intentional or coincidental?
Where is General Jack D. Ripper when you need him?
“Accordingly, the 2007 financial results of Chrysler LLC under U.S. GAAP are substantially better than the IFRS-based financial results utilized by Daimler.”"
Hmmm, that sounds like it is harder to cook the books under IFRS rules than it is under GAAP.
The Chrysler Technical Center in Auburn Hills was designed so that it could be turned into a shopping mall if Chrysler failed.
Home Depot is already there, when is Sears moving in?
I’m exhausted with Chrysler Co.
This is a company that has really attractive and interesting cars in the Dodge and Jeep name and yet can’t capitalize on their attractiveness. (Obviously, Chrysler the brand is made up of all ugly.) I looked at a Dodge Avenger today and immediately wanted one. My mom agreed with me, it was attractive, looked good on the road.
Then I find out its fuel economy isn’t so good, it’s not sporty, it’s not fun. It’s not even class competitive.
Jeep Patriot is attractive and has “real” four-wheel drive (trail rated), but suffers from the same problems.
Yeesh. I have all the respect in the world for American workers and hope they can remain employed for as long as possible against the onslaught from newly-industrializing countries, but I kinda wish Chrysler–specifically Dodge–would go away and stop tempting me with its attractive but terrible cars.