The head of DaimlerChrysler’s Chrysler unit said on Wednesday that the car maker was on track to save an additional $US1 billion through cost cuts this year, Reuters reported.
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The news agency noted that, only a few weeks ago, Chrysler chief executive Dieter Zetsche said the US unit could fall somewhat short of its cost cutting goal, which was announced after a surprising second-quarter profit warning in June, but Zetsche now told Reuters the target was now firmly within reach.
“The most recent progress we are making makes me confident by today that we’ll get the entire $1 billion in incremental cost savings,” he reportedly said, adding: “Altogether, on the cost side, I’m very satisfied with the accomplishments of the team.”
According to Reuters, Zetsche did not elaborate on the cost cuts, which were announced after Chrysler blamed its $1.1 billion second-quarter loss on Detroit’s cutthroat price war – the cuts come on top of Chrysler’s restructuring, which has reduced its work force by 20% since 2001.
But, Reuters added, many industry analysts have questioned whether Chrysler, whose US sales have slumped dramatically in recent months, will reach its break-even profit target this year.
Zetsche declined to comment to Reuters on the break-even target, saying he had nothing to add to previous guidance.
