Chrysler LLC chief executive Bob Nardelli said Monday
he is pleased with a money-saving labour contract that was approved
by workers over the weekend and is looking to raise more cash by
selling US$1 billion worth of unneeded real estate and buildings.
``The auto industry has an insatiable desire for cash,'' Nardelli
said during an interview before participants in the American
Chrysler also announced Monday that it named L. John Cataldo as
vice-president for business development and mergers and
acquisitions, a critical role for the company as it looks to expand
overseas sales by partnering with other automakers. Cataldo is a
13-year veteran of General Electric Co. Nardelli is a former GE
Chrysler's labour agreement, which establishes lower wages for
thousands of workers and a union-run trust to cover retiree health
care, passed by a slim majority of workers after a six-hour strike
earlier this month. The last vote was held Saturday. The United Auto
Workers said 56 per cent of production workers and 51 per cent of
skilled trades workers voted in favour of the pact.
Nardelli said the contract was ``revolutionary.'' He said the
trust should give workers more confidence that their health care
will be covered and will allow Chrysler to focus on its core
``I would expect some of it is just an uneasiness with change,''
he said of the close vote.
Nardelli also said the company will end the year with 100,000
fewer vehicles in its inventory than last year in an effort to
control production and pacify dealers angered when the automaker
tried to push too many vehicles onto their lots. Chrysler finished
2006 with more than 538,000 vehicles in its inventory, or a 74-day
supply. The ideal for the industry is a 60-day supply.
``Those are the kind of decisions... that make us right-sized,''
Nardelli said the automaker is trying to dispose of property that
has been sitting on its books but is no longer needed, such as real
estate or old office buildings. He gave no specifics.
Nardelli said it's refreshing to be at a private company, where
decisions to dispose of assets can be made quickly and don't have to
be reported in an earnings statement.
The private equity firm Cerberus Capital Management LP bought a
majority stake in Chrysler in August and installed Nardelli, the
former CEO of The Home Depot Inc., as chief executive. Nardelli said
a recent decision to cut production that was made in several minutes
might have taken months when Chrysler was a public company.
``It's either a yes or a no, but not a slow maybe'' under
Cerberus, he said.
The interview took place in Boca Raton, Fla., but was broadcast
live over the Internet. The conference is sponsored by the Magazine
Publishers of America and the American Society of Magazine Editors.