Chrysler to remain mum on financial info

1/7/2009

Chrysler LLC, operating with a $4 billion taxpayer-funded bailout from the U.S. government, isn't required to report financial information to the public and has no plan to do so.

Chrysler, closely held by Cerberus Capital Management LP, won't disclose its operating results, a spokesman said. The loan agreement requires the Auburn Hills, Mich.-based automaker to report its finances only to the U.S. Treasury, which hasn't committed to releasing the information.

Since Cerberus bought the company in August, 2007, Chrysler executives have said the company's "private" status allowed it to sell assets and close factories without concern for accounting charges that might alarm a public company's shareholders.

"At the very least, Chrysler should have the same level of transparency that General Motors has," said Peter Morici, a University of Maryland economist who testified in congressional hearings in November about the industry. There should be a level of accountability, he said, "that is not present here."

The U.S. Treasury, trying to stave a collapse of the companies, pledged as much as $17.4 billion to Chrysler and Detroit-based General Motors Corp. on Dec. 19. Chrysler got $4 billion on Jan. 2 and must show by Feb. 17 how it will return to viability.

Chrysler must submit weekly status reports, biweekly cash statements, and monthly certifications to the Treasury to show it's complying with policies on expenses. The agreement doesn't require Chrysler to disclose results to the public.

"We are not in a position to mirror publicly traded companies, as our investors remain private," Chrysler spokesman Lori McTavish said. "However, the company is obligated to our private investors and lenders, and as such, keeps them apprised."

Cerberus spokesman Peter Duda declined to comment.

Treasury spokesman Brookly

McLaughlin declined to say whether the department would disclose any of Chrysler's financial information.

Chrysler has revealed select information during the past year. Through the first half of 2008, the company said its losses amounted to about $1.08 billion. During congressional hearings in November, Chief Executive Officer Robert Nardelli said the company had $6.1 billion in cash at the end of September.

Chrysler finished 2008 with a 53 percent decline in December U.S. new-car and light-truck sales. U.S. sales fell 30 percent for the year, the most of any major automaker.