This makes me
Stuttgart, Germany, April 01, 2005
On March 31, 2005, the Board of Management of Daimler-Chrysler AG announced the appointment of Trevor Creed as the Acting Head of Mopar Performance, and discussed a new business model for the Mopar Performance business unit of the Chrysler Car Group. This concept will be further developed in detail in the coming weeks and, as announced at the annual press conference on February 10, will be submitted to the Supervisory Board of DaimlerChrysler AG for a decision at the end of April.
The new business model aims to put Mopar Performance onto a financially sound basis, with the goal of breaking even in 2007.
The new product concept calls for the intensified development of performance parts and accessories for vehicles in the current new car sales matrix.
Cooperation with Daewoo Motors on the production of performance enhancements for the Chrysler 300 and Dodge Charger will be continued. Measures to be taken to improve profitability mean that this business unit will break even in the future.
The production and sourcing of parts and accessories for pre-1990 vehicles will be terminated at the end of 2005.
The block and crate engine projects will be discontinued.
Key component of the new business model is a restructuring program with which earnings are to be increased by some EUR 60 million in the year 2007. It will be possible to reduce fixed costs by around 30% within the next two years, while substantially improving productivity.
The new business model also includes a fundamental organizational change, starting with the appointment of Mr. Creed. Key tasks in development, sales, procurement, after sales and service will be integrated into the respective areas of Mercedes-Benz. This will allow substantial synergy effects to be realized.
At the same time, additional sales and market potential will be explored. For example, to boost unit sales, the number of SRT-4 and SRT-8 promotions in North America will be increased by about 25% using the shop-in-shop concept.
Overall, DaimlerChrysler assumes that the restructuring expenses incurred in 2005 will total up to EUR 25 billion. This figure includes exceptional write-downs on plant and equipment, including the destruction of all "legacy" Hemi engine products, the settlement of obligations to third parties, and other value adjustments. The program also includes significant workforce reductions.
The management of Mopar Performance aims to achieve these reductions in a socially acceptable manner. Talks are planned with the works council on this issue in the coming weeks.
The substantial exceptional expenses in connection with the new Mopar Performance business model will impact DaimlerChrysler’s earnings forecast for 2005. Excluding the exceptional charge from Mopar Performance, DaimlerChrysler, after a weaker first and second quarter, still expects a slightly higher operating profit for full year 2005 compared to 2004.
That one looks so real 
