By Robert Farago
June 18, 2008
In an epic feature presentation, Bloomberg reveals that former Home Depot CEO Bob Nardelli beat out Wolfgang Bernhard for Chrysler's top slot by dint of his pessimistic analysis of the biz. Well, he's got plenty to be pessimistic about now; most important of which is, as we've pointed-out numerous times, Chrysler's cash flow. "Nardelli, who spends most weeknights at the Townsend Hotel in nearby Birmingham, Michigan, and commutes home to Atlanta on weekends [ED; who says Detroit execs don't care about their carbon footprint?], gets constant reminders that he's racing the clock at Chrysler. Every day, he and his top executives receive an e-mail from the treasurer's office showing how much cash Chrysler has on hand." Just because he's paranoid… "The carmaker started 2008 with $9.5 billion, a person familiar with the situation says. After tapping a $2 billion credit line from Cerberus and Daimler AG and setting aside $1.6 billion to repay a loan from the United Auto Workers union for a retiree health fund, cash will drop to $7.7 billion at the end of 2009, the person says. Chrysler needs $2.5 billion-$3 billion to fund its day-to-day requirements." Wow, that's a lot of billions! But not, as we know, enough to keep the automaker afloat in these truck-aversive times. Tick tock.
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POWERED
June 18th, 2008 at 1:03 pm
Not appointing Wolfgang Bernhard to lead Chrysler was just the latest in huge mistakes made by the people handling the company.
June 18th, 2008 at 1:06 pm
Don’t forget that $1B is for executive management bonuses / compensation and bribes for the corrupted BOD for doing a “heck uva job”.
June 18th, 2008 at 1:32 pm
I wonder if Brownie can get a position there?
June 18th, 2008 at 2:12 pm
Micheline Maynard predicted that 1 of the Detroit 3 would be unrecognizable or defunct by the end of this decade. With today’s headlines, turns out she might be only halfway correct.
June 18th, 2008 at 2:41 pm
I don’t understand why employees of this company just don’t all look for other jobs, like, right now.
To all Chrysler employees, if you’re a database admin and want to relocate, call me. Same thing goes to the GM folks.
June 18th, 2008 at 2:53 pm
I dont concur with the title of this article. Any good business person, especially buying a risky thing like chrysler, would want to keep constant tabs on cash. The risk has certainly risen, but its almost like some kind of cheering section for bankruptcy exists here.
June 18th, 2008 at 3:13 pm
rocket88 :
I dont concur with the title of this article.
Point taken. Headline amended.
June 18th, 2008 at 3:36 pm
Rooting for one’s demise is…well needed as these companies are ignorant to changes and long term future. Their management is so obtuse and uncaring for many of its customers and employees – who wouldn’t root for change? The only way to change is for one or all to go through bankruptcy and emerge leaner and smarter (more long term focused and not short term dividend like they’ve been for the past 30 years). There is so much red tape and lack of accountability for their leaders in a competitive world market – the old way of doing things no longer works – and the D2.8 haven’t changed their mindset.
June 18th, 2008 at 6:19 pm
It’s hard to imagine how Cerberus thought they could fix Chrysler sufficiently to sell it without the input of a true ‘car’ guy, particularly a former insider like WB.
A penny pincher like Nardelli certainly is an asset in some ways, but having him making key product/strategy decisions? With his background?
Puleeeeeze!
June 18th, 2008 at 7:04 pm
The Cerberus guys must have just wanted the Jeep brand (diehard Jeep fans!) and so they didn’t remember that the UAW came with it… LOL
June 18th, 2008 at 8:45 pm
@ jkross22
Didn’t you hear? They’ve outsourced their IT Ops to India (Tata) already.