Dieter Zetsche confirms talks with potential partners regarding the Chrysler Group
April 04 2007 - 3:35AM
PR Newswire (US)
- Approximately 8,000 shareholders expected at the Annual Meeting
in Berlin BERLIN, April 4 /PRNewswire-FirstCall/ -- Dr. Dieter
Zetsche, the Chairman of the Board of Management of DaimlerChrysler
AG (NYSE:DCX), has confirmed for the first time that discussions
have taken place with interested parties regarding future options
for the Chrysler Group. "In this context, I can confirm that we are
talking with some of the potential partners who have shown a clear
interest," Zetsche is quoted as saying in the text of the speech he
will deliver at the Annual Meeting 2007 in Berlin today. However,
Zetsche continued, "But it is also true that we need to keep all
options open, and that I cannot disclose any details, because we
need to have the maximum scope for maneuver." The company's
management requires "the greatest possible flexibility so that we
can identify and then professionally implement the best possible
solution." (Logo:
http://www.newscom.com/cgi-bin/prnh/20020212/DCXLOGO ) The basic
requirement with all options is that the Recovery and
Transformation plan, presented in February, is consistently
implemented, which will lead Chrysler back to profitability.
DaimlerChrysler has defined clear criteria for the decision-making
process. The company wants to * enhance DaimlerChrysler's financial
strength in a sustainable way and increase enterprise value; *
create the right conditions for a clear strategic focus for
DaimlerChrysler; * make the Chrysler Group's business system
competitive and profitable on a sustainable basis; * find the best
possible option for the employees. "This means, that after
reviewing all options, we will finally decide for the option that
best meets our criteria," Zetsche is quoted in the text of the
speech, adding: "So far, I am satisfied with the process.
Everything is going according to plan." Sustainable mobility In
light of the recent discussion on climate protection, the Daimler
Chrysler Chairman gave a clear commitment on sustainable mobility:
"For us at DaimlerChrysler, the emission-free automobile is and
remains the long-term goal of our 'roadmap' toward sustainable
mobility." This roadmap has three main components: * the consequent
further improvement of combustion engines, with and without a
hybrid option; * high-quality and alternative fuels; *
emission-free driving, with the fuel cell as a long-term goal.
Since 1990, DaimlerChrysler has reduced its fleet consumption and
the CO2 emissions of its passenger cars in Germany by 30 percent.
It has also lowered exhaust emissions by more than 70 percent and
particulate emissions by more than 95 percent in some cases. The
company is also pursuing a strategy "to make diesel engines as
clean as gasoline engines -- and gasoline engines as economical as
diesels," says Zetsche. In the meantime, every fifth Mercedes
vehicle can travel 100 kilometers on five liters or less. The smart
cdi is the world's best-selling three-liter car, and also the world
champion when it comes to low CO2 emissions, emitting only 88 grams
of CO2 per kilometer. DaimlerChrysler believes that BLUETEC, the
clean diesel technology, which reduces some emissions by up to 80
percent, can play a key role in helping to further optimize
combustion engines. Hybrid technology also enables combustion
engines to be operated more efficiently. DaimlerChrysler was
already developing hybrid vehicles in the early 1990s and today has
a 60 percent share of the world market for hybrid buses, making it
the world market leader. "Every new vehicle we develop will be
engineered to accommodate a hybrid drive train," says Zetsche. High
grade and alternative fuel plays a key role in ensuring that modern
engines can be used effectively. Because oil reserves are finite,
DaimlerChrysler is preparing its engines for use with alternative
fuels as well. In addition to natural gas and bioethanol, the
company is focusing on second-generation biofuels -- in other
words, on synthetic biomass-to-liquid fuels (BTL), which are made
from straw or waste wood. In the long term, DaimlerChrysler is
committed to the fuel cell drive, which is not only environmentally
friendly but also highly efficient. The company is a pioneer in
this key technology, having presented the first-ever fuel cell
vehicle back in 1994. "However, the fuel cell remains a technology
of the future. There is still a long way to go," emphasizes
Zetsche. Zetsche therefore called on politicians, the oil industry
and auto makers to work together in order to create, for example,
an appropriate legal framework, the necessary infrastructure, a
hydrogen supply network, and the requisite automotive technology in
order to address the many questions that remain unanswered with
regard to fuel cell technology. In 2006, DaimlerChrysler invested
euro 5.3 billion in research and development. A large part of this
was for innovations and technologies for clean and environmentally
friendly vehicles, including euro 1.4 billion invested in Europe.
Overview of strategic developments Turning to the development of
DaimlerChrysler, Zetsche pointed out that the company
systematically analyzed its overall situation throughout 2006 and
scrutinized the strategy for each division. Implementation of the
CORE program continued at the Mercedes Car Group in 2006. The aim
in 2007, the third and final year of CORE, is to lay the foundation
for the period beyond. Here the division is focusing on the
introduction of its module strategy, a sharpened profile of
Mercedes-Benz brand and measures that will further enhance customer
satisfaction. As announced, smart is now fully integrated into the
Mercedes organization and will become profitable this year. Taken
together, all these measures will put the Mercedes Car Group back
on top and enable it to achieve at least the seven percent Return
on Sales target for 2007, as presented in 2006. The progress the
Chrysler Group has made in terms of productivity, cost- reducing,
and quality improvement has given it a much more competitive
structure than its American competitors. The model offensive at
Chrysler will continue between now and 2009 with 20 more all-new
vehicles and 13 refreshed models, including a series of very
economical vehicles. Moreover, the Recovery and Transformation Plan
is very realistic that it also gives up room to offset unforeseen
market developments. The Global Excellence Program for the Truck
Group is boosting the productivity and worldwide integration of the
division, while maintaining maximum flexibility. It is enabling the
division to manage cyclical market fluctuations more effectively
and to earn a Return on Sales of at least seven percent over the
entire market cycle. Depending on the cycle, some years would be
above, and some years would be below this target. The Truck Group
expects that the Class 8 segment of the U.S. truck market will
decrease by as much as 40 percent, while in Japan the downturn is
expected to be about 25 percent. However, the market in Western
Europe will at minimum remain stable. The Financial Services
division continued its positive development with its fifth
consecutive record-breaking year in 2006. With regard to
efficiency, the division will set a new benchmark level -- while
maintaining a strong focus on its customer's organization. Zetsche:
"In addition to providing our automotive divisions with the best
possible support, we plan to post a 14 to 20 percent Return on
Equity." Zetsche also provides the approximately 8,000 shareholders
present with a detailed look at the results of 2006, in which the
company generated revenues of euro 151.6 billion and recorded an
operating profit of euro 5.5 billion. The DaimlerChrysler Group's
net income increased by 13 percent to euro 3.2 billion. Due to the
continued implementation of its efficiency-boosting programs,
DaimlerChrysler expects an considerable increase in profitability
over the next three years. "In the medium term we aim to achieve a
Return on Net Assets of at least 10 percent after taxes." A more
detailed earnings forecast for the full-year 2007 will be presented
to coincide with publication of the company's financial results for
the first quarter on May 15, 2007. Proposed dividend The Board of
Management and the Supervisory Board propose to the Annual Meeting
that DaimlerChrysler pay a dividend of euro 1.50 per share for 2006
(2005: euro 1.50). This corresponds to a dividend sum of euro 1.5
billion (2005: euro 1.5 billion). This recommendation takes into
consideration the operating profit and cash flow development in
2006, as well as the outlook for subsequent years. This document
contains forward-looking statements that reflect our current views
about future events. The words "anticipate," "assume," "believe,"
"estimate," "expect," "intend," "may," "plan," "project", "should"
and similar expressions are used to identify forward looking
statements. These statements are subject to many risks and
uncertainties, including an economic downturn or slow economic
growth, especially in Europe or North America; changes in currency
exchange rates and interest rates; the introduction of competing
products and possible lack of acceptance of our products or
services; competitive pressures which may limit our ability to
reduce sales incentives and raise prices; price increases in fuel,
raw materials, and precious metals; disruption of production or
delivery of new vehicles due to shortages of materials, labor
strikes, or supplier insolvencies; the ability of the Chrysler
Group to reduce costs, especially in light of restructuring
activities underway at some of our major competitors in the NAFTA
region, and to respond to shifts in market demand towards smaller,
more fuel-efficient vehicles; effective implementation of
cost-reduction and efficiency- optimization programs, including our
new management model; the business outlook of our equity investee
EADS, including the financial impact of delays in and potentially
lower volume of future aircraft deliveries; changes in laws,
regulations and government policies, particularly those relating to
vehicle emissions, fuel economy and safety, the resolution of
pending governmental investigations and the outcome of pending or
threatened future legal proceedings; a decline in resale prices of
used vehicles; and other risks and uncertainties, some of which we
describe in the current Annual Report under the heading "Risk
Report". If any of these risks and uncertainties materialize, or if
the assumptions underlying any of our forward looking statements
prove incorrect, then our actual results may be materially
different from those we express or imply by such statements. We do
not intend or assume any obligation to update these forward looking
statements. Any forward looking statement speaks only as of the
date on which it is made. Additional information from
DaimlerChrysler is available on the Internet at:
http://www.media.daimlerchrysler.com/
http://www.newscom.com/cgi-bin/prnh/20020212/DCXLOGO
http://photoarchive.ap.org/ DATASOURCE: DaimlerChrysler AG CONTACT:
Han Tjan, +1-212-909-9063, Mobile: +1-917-667-2381, or Thomas
Frohlich, +49 711 - 17-4 13 61, or Mobile: +49 160 - 86 14 778 Web
site: http://www.daimlerchrysler.com/
http://www.media.daimlerchrysler.com/
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