Troubled Chrysler suffers 'massive' loss

Ailing US carmaker Chrysler Holding LLC sustained a net loss of 1.94 billion euros according to IFRS accounting rules between the close of its sale on Aug 4 and the end of the third quarter, former owner Daimler said.

The loss was mainly due to extraordinary charges resulting from items that included restructuring measures and a new agreement reached with the UAW trade union.

Daimler added that as of the end of last year, Chrysler had not drawn upon a $1.5 billion credit line to which the German carmaker had committed.

Daimler, which still owns nearly a fifth of Chrysler, had to book a 322 million euro charge during the fourth quarter, suggesting the total extraordinary charge that hurt Chrysler's consolidated results was much larger.

Chrysler's results affect Daimler's earnings with a three-month delay.

According to Daimler's figures, Chrysler had revenue of 7.97 billion euros during the Aug 4-Sept 30 period and listed total assets on its balance sheet of 90.4 billion euros at the end of September. Liabilities totaled 87.75 billion euros.

The figures, used as the basis for applying the equity method in Daimler's consolidated financial statement, are adjusted for "significant transactions and events" during the fourth quarter of 2007, it said.

Daimler has a stake of 19.9 percent in Chrysler after selling the company last year to US private equity firm Cerberus.

"As a private company, we do not publish financial figures," a Chrysler spokeswoman said.

The US carmaker has in the past mainly accounted for its results using US GAAP accounting rules.

Agencies

(China Daily 02/29/2008 page16)