Chrysler to lose $4.7B this year

More money down the rathole. Soon our money will be on a par with
Weimar Germany after WW1, we are just running the presses to fund this
Fiasco

Chrysler to lose $4.7B this year
http://tinyurl.com/cvn3se

Adviser for the bankrupt automaker estimates that Chrysler will burn
through $15.7 billion during restructuring, expects losses to continue
through 2011.
By Chris Isidore, CNNMoney.com senior writer
Last Updated: May 4, 2009: 3:13 PM ET

NEW YORK (CNNMoney.com) -- Chrysler LLC expects to lose $4.7 billion
this year and to continue to lose money for the next two years,
according to a filing from one of the company's top financial advisers.

Robert Manzo, a financial adviser hired by Chrysler for help with the
company's bankruptcy process, estimated in the filing that the company
will have cash expenditures far greater than losses for the next few
years. Chrysler is estimated to go through about $15.7 billion this year
as part of its restructuring.

The company filed for bankruptcy Thursday as part of a deal with the
federal government, unions, some lenders and Italian automaker Fiat to
keep the company from being shut down.

Chrysler is a privately held company that has not publicly released its
financial results since it was purchased by private equity firm Cerberus
Capital Management in 2007, and analysts therefore do not publish loss
estimates for the company.

Analysts surveyed by Thomson Reuters forecast that larger rival General
Motors (GM, Fortune 500), which is also facing the threat of a
bankruptcy filing at the end of this month, will post a net loss of
$18.4 billion this year, while Ford Motor (F, Fortune 500), which is
also significantly larger than Chrysler, is expected to lose $6.2
billion this year.

The filing also disclosed that Chrysler lost $16.8 billion in 2008.
That's about the same as what GM lost in 2008, excluding special items,
although not as bad as the $30.9 billion net loss at GM. But it was
worse than the $14.6 billion lost by Ford last year.

Manzo's filing forecasts that Chrysler will lose about $900 million in
2010 and another $300 million in 2011, before finally reporting a $100
million profit in 2011.

The forecasts are far worse than the estimates Chrysler gave in a Feb.
17 filing with Treasury in which it requested additional government
help. In that filing it estimated that a stand-alone Chrysler LLC would
lose $1.1 billion this year, make a $600 million profit in 2010 before
losing $600 million in both 2011 and 2012.

The company won additional cost savings from the United Auto Workers
union in a concession contract ratified last week, and reached agreement
with a number of major lenders to significantly reduce the $6.9 billion
in secured loans it had outstanding. It also reached a deal to combine
operations with Italian automaker Fiat, although that deal has yet to close.

But Chrysler filed for bankruptcy court protection when it was unable to
close a deal with all of its lenders. It expects to have Fiat purchase
its most attractive assets through the bankruptcy process, leaving
behind many of its liabilities and excess plants in the bankruptcy
court's jurisdiction.

The government has agreed to loan it $8 billion to see it through the
bankruptcy process on top of the $4 billion in federal help it has
already received

 

FYI the losses in a company's statement aren't just cash.
Much of the loss is write off of plant and equipment, simply accelerated
depreciation. No cash is involved.

 

who wrote:
p://tinyurl.com/cvn3se

The plant and equipment cost cash. If it's written off then it was on
the positive side of the books as an asset for some time period. It all
works out the same in the end.