Daimler Says It Will Hit Forecast
FRANKFURT, Germany (AP) _ DaimlerChrysler chief executive Juergen Schrempp said profits would be within the company’s forecast range for this year, despite the slowing world economy and the economic shock of the Sept. 11 terrorist attacks.
``Despite the difficult economic situation, we still believe that it will be possible for us to reach the lower end of our operating profit target this year,″ Schrempp was quoted as saying by an employee newspaper, a copy of which was provided by the company Thursday.
The company has said it would reach an operating profit of between 1.2 billion euros ($1.1 billion) and 1.7 billion euros ($1.5 billion) for 2001. Operating profits exclude items such as interest and taxes.
``As far as next year is concerned, I can say from today’s perspective that it will be an exceptionally challenging year for the world economy,″ Schrempp said. ``Nevertheless, we believe that our earnings will be significantly higher in 2002 than they were this year.″
The company, based in Stuttgart and Auburn Hills, Michigan, has launched a three-year plan to turn around its money-losing Chrysler Group in the United States that will mean the loss of 26,000 jobs _ 20 percent of its work force _ and the shuttering of six plants. One-time restructuring costs associated with the program are estimated at around 3 billion euros ($2.7 billion).
Chrysler lost $238 million in the third quarter, an improvement over its $517 million loss a year earlier.
Chrysler has seen U.S. sales slip despite matching costly zero-percent financing offered by competitors GM and Ford. Schrempp criticized the practice, saying that ``sales that are created artificially through major incentives are neither sustainable nor profitable.″
Shares of DaimlerChrysler fell 50 cents, to close at $39.86, in trading Thursday on the New York Stock Exchange.
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