Daimler AG, the German company that once owned all of Chrysler and now owns 19.9 percent, depreciated its stake in the Auburn Hill, Michigan, automaker from $268 million at the end of the second quarter of 2008 to $0, from an accounting standpoint, yesterday. Just over a year ago, Daimler said its nearly 20 percent share was worth $2.2 billion.
Daimler did say it plans to continue negotiations with Cerberus Capital Management over the remaining share of Chrysler, though it’s unclear how this latest announcement will affect the transaction.
“The pain level must be extraordinary over there — Cerberus and Chrysler and Daimler. You can just imagine how tortured they are,” Gerald Meyers, a University of Michigan business professor and former American Motors chairman, told the Detroit Free Press.
Despite Chrysler’s recent woes – which have been epic, even by Detroit auto industry standards – the company has burned through far less cash in the first half of this year than its two chief hometown rivals. Chrysler’s automotive and finance businesses lost $1.17 billion, whereas Ford Motor Company lost $8.6 billion and General Motors lost $18.7 billion.
10/24, 9:11 AM
posted by:
edgeguy
LOL I would say thats a fairly accurate assessment.
10/24, 9:27 AM
posted by:
tyler_is_aero_tt
They need to learn how to build a vehicle that gets good gas mileage and scores above average on reliability.
10/24, 10:34 AM
posted by:
johnnycanuck
An accurate assessment or just a case of sour schnapps? As in ‘ we were pretty much responsible for this whole debacle, so why weren’t we smart enough to bail at 2.2 billion?’
Serves the bastards right. I feel for the potentially and almost undoubtedly thousands of people who could/will lose their livelihood over this, but seeing those who are truly responsible get kneed in the financial groin provides at least some small redemption.
10/24, 11:08 AM
posted by:
mayer_ray_nagin
Chryslers may be crap, but Daimler doesn’t build much of anything too interesting either. If it weren’t for snob appeal, Daimler would be just as worthless.
10/24, 11:24 AM
posted by:
Need4SSpeed
Chrysler is worth $0 thanks to Daimler…
10/24, 11:52 AM
posted by:
freeyellow2000
Daimler should just sale his share to Nissan/Renault and be done with it..
10/24, 12:05 PM
posted by:
TomF
It’s just balance-sheet politics. It doesn’t mean anything.
10/24, 12:12 PM
posted by:
ricky_b
may just be a balance sheet, but it’s also a slap in the face kind of comment on Daimler’s part. Although looking at how “competitive” Chrysler’s products are these days, Daimler does kind of have a point.
10/24, 12:16 PM
posted by:
neptronix
.. yet, GM still needs a loan to buy chrysler…
LOL
IMHO, chrysler is worth -$234,728,1341 baztriillion gazillion
10/24, 12:52 PM
posted by:
sharpie
The 19.9% Daimler owns will be capital gain if they sell it now, and it is taxable. Depreciation has nothing to deal with the actual value of Chyrsler.
10/24, 12:54 PM
posted by:
sharpie
Let me clarify, depreciation from taxation point of view has nothing to deal with the actual value of Chrysler. This is not to say Chrysler’s value as a company did not depreciate, but not to $0 for sure.
10/24, 2:37 PM
posted by:
howsmydriving
I would definitely pay $1 for a 19.9 percent ownership of Chrysler, so this story is totally inaccurate.
10/24, 3:25 PM
posted by:
oakley198877
0? sounds about right… XD
10/24, 4:18 PM
posted by:
WAYNE WEATHERSBY
What a stupid article to write to begin with???What a bunch of morons……Yet Jeep is worth 8 billion on the open market?????
10/25, 2:13 AM
posted by:
The Stig
The top execs must be ramping up their golden parachute manufacturing facilities by now.
10/25, 7:24 AM
posted by:
CanadaCraig
An odd thing to say given the fact [?] that Cerberus wants to buy Damiler’s 19.9%.