Dieter Zetsche, DaimlerChrysler’s incoming chairman, has acknowledged that he was stepping down as head of the automaker’s Chrysler division without having met a key target for profits and revenue.
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Zetsche, spoke to Reuters when asked about research from the Harbour Consulting group released earlier this week showing that Chrysler made an average of just $US186 (£103) per vehicle in the first half of the year in North America.
The news agency said that was better than General Motors and Ford, which both lost money, but paled in comparison with Toyota, Honda and Nissan Motor which all earned well over $1,000 per vehicle.
Zetsche, who Reuters said has been credited with a dramatic turnaround at Chrysler since he took over as its boss nearly five years ago, did not dispute the $186 figure but said it meant he was leaving the US arm of the world’s fifth-largest automaker with some unfinished business when it comes to boosting its net pre-tax profits.
“From a return on sales perspective, 5% is what we are striving for and we are not there yet,” he told the news agency.
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By GlobalDataHe reportedly did not elaborate or say when the company might meet the target, which is a measure of overall operational efficiency.
Zetsche too over as head of DaimlerChrysler’s ailing Mercedes division on Thursday and also becomes DC chairman on January 1, replacing Juergen Schrempp, Reuters noted, adding that will leave his deputy, Tom LaSorda, who is replacing Zetsche as Chrysler’s chief executive, with the 5% return-on-sales goal to attend to.
“Obviously we want to continue to improve our profitability,” LaSorda told Reuters, when asked per-vehicle profits.
The news agency noted that there is an old saying among Detroit automotive executives that one of the city’s traditional Big Three automakers is always “in the tank” or struggling to make a profit.
Chrysler is in the black, and a $186 per vehicle profit is far better than the $1,227 loss that financially-troubled GM averaged on the cars and trucks it sold in North America in the first half of 2005, according to Harbour Consulting, it said.
