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Chrysler Won’t Return to “Old Days of Sin,” Insists CEO Marchionne

Global realignment coming, no big-buck payouts planned for top managers.

by on Jul.26, 2011

Sergio Marchionne hints he'll likely remain CEO of Chrysler after the upcoming management realignment.

Gone are the “days of sin,” when cash was seen as the answer to everything at Chrysler, said CEO Sergio Marchionne, as he answered questions about the maker’s second-quarter loss and dodged others looking at the planned global consolidation of Chrysler and its Italian partner Fiat.

In a wide-ranging discussion, Marchionne made it clear his goal is to “extract value” from the combined Chrysler-Fiat organization by making them work more closely together.  But he cautioned that he does “not want to screw up” Chrysler’s nascent revival – something that could readily happen if it lost focus on what it does best.

Marchionne downplayed concerns about Chrysler’s $181 million second-quarter loss – noting the maker went into the red because of a $551 million charge related to the recent payoff of its federal bailout loans.  (Click Here for more on Chrysler’s earnings.)

“I think we have made great progress,” said the Canadian-educated executive.  “We feel we are on target.”

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In the coming days, Marchionne confirmed he will announce a global realignment that will consolidate key positions in the Chrysler/Fiat alliance, eliminating the current redundancy and creating a more streamlined enterprise that is “ultimately the best way to extract value” for shareholders.  While he declined to provide specifics, the CEO suggested that the move “should show benefits quickly.”