The reported loss of $1.4 billion by the American arm of DaimlerChrysler may be too much to bear for the German-American hybrid. Chrysler’s German parent still managed to report a profit of $686 million and its CFO Bodo Uebber didn’t rule out the possibility of dropping its American operations, telling reporters "We don't exclude anything here... We will do our analysis. Second, we will talk about measures. And third, we will draw our conclusions."
It’s best not to jump to any conclusions. Chrysler has been profitable in the recent past, and there’s still significant potential in both the US and global markets. The next challenge will be to address health plan issues with the UAW, improve its product mix by adding smaller cars and improve its brand image with new and exciting vehicles.
Further, we recently reported that Chrysler were getting top management from the successful Mercedes Benz brand to form a taskforce to help Chrysler cut $1000 from the average cost of a vehicle. It’s hard to imagine that DCX will be dumping the Chrysler Group anytime soon.