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CEO: Chrysler will break even in 2010

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CEO: Chrysler will break even in 2010

David Shepardson / Detroit News Washington Bureau

New York -- Chrysler Group LLC CEO Sergio Marchionne said today that the company is still on track to break even this year.

"I made a commitment to break even," he told reporters on the sidelines of a forum here, insisting that despite a sales slump this year, the company won't lose money on an operating basis. Asked if Chrysler could even profit this year, he said, "Who knows?"

Marchionne said Chrysler wouldn't get into an incentive war and reiterated he was still confident that the company would sell 1.1 million vehicles in the United States this year. He said the company wouldn't follow Toyota Motor Corp. in boosting incentives.

"It takes a long time to build brand equity," Marchionne said. "We can't risk it."

He called boosting incentives dramatically "unwise and unhealthy" and predicted industry auto sales above 11 million for all of 2010. HE also said the company had $5 billion in the bank at the end of last year.

Marchionne said Fiat SpA will provide its financial update as part of its long-term plans on April 21, similar to Chrysler's November event.

He disclosed the company will begin production on its new 2011 Jeep Grand Cherokee on May 3 and it will go on sale in late June or July.

The Jeep Grand Cherokee is a key vehicle that then-Chrysler LLC showed at the New York International Auto Show last year. "It's going to represent the best of Chrysler technology and quality," he said. "It's a signature vehicle for the Chrysler Group and it needs to be perfect and it will be."

Marchionne reiterated that more than half of the company's vehicles will be built on Fiat platforms by 2014, a strategy first outlined in November.

He said his management style is not as "master of the world" but to inspire and get the best out its employees.

Marchionne said that the company will invest $500 million in its dealer network over five years. The company has offered 86 of its former dealers the chance to regain their franchises.

He reiterated his criticism of a law Congress passed in December that gave Chrysler's 789 closed dealers in June 2009 the right to challenge their closings in arbitration as "not helpful."

Marchionne noted that today is the one-year anniversary of President Barack Obama's decision to provide 30 days working capital to Chrysler in order for the company to reach a tie-up with Fiat.

Marchionne's speech was briefly disrupted by a group of six protestors who attempted to enter the ballroom. They were protesting Chrysler's handling of its car hauler contracts.

Later, a hotel firm alarm test interrupted his speech for a second time.

Marchionne said he works seven days a week and has 78 people who directly report to him at Chrysler and Fiat.

From The Detroit News: http://www.detnews.com/article/20100330/AUTO01/3300400/1148/auto01/Marchionne--Chrysler-will-break-even-in-2010#ixzz0jh6wjIxE

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