Chrysler CEO: We've All Made Mistakes

CBS Evening News: Katie Couric Interviews Robert Nardelli On His Bailout Proposal

(CBS)  After his testimony on Capitol Hill, Chrysler CEO Robert Nardelli spoke with CBS News anchor Katie Couric. She asked him how he could convince the majority of Americans who oppose a government bailout that it's the right thing to do. What follows is a transcript.

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Robert Nardelli: I think part of today and hopefully through our discussion here we can provide a differing perspective. So for example there are about a million people count on Chrysler's success - if you look more broadly about one out of 10 Americans here either work for or support the auto industry, so if the auto industry was to collapse, Katie, it would have a huge impact - a cataclysmic collapse of between 2 million and 3.5 million jobs unemployment. If you want to talk about systemic impact, just in the three manufacturing companies, there are about $300 billion of equity from the financial institution of debt that would go away. If you look at the suppliers, the three of us pay about $150 billion a year to our supplier base. So this thing has broad tentacles. I can't imagine it doesn't touch every American in some form or fashion in their neighborhood, rural, suburban areas, if this industry goes away.

Katie Couric: An economist, Mark Zandi, testified alongside you today said he believed the Detroit Three bailout costs could reach anywhere between $75 and $125 billion, and there high probability you'd be asking for more money within a year. Is that a possibility this $34 billion bailout could be followed by another "ask" down the road?

Nardelli: We did not present a plan today with the expectations that we would come back in six months or one year. They asked for us to present a plan that had viability for the long term, and that's what we submitted today, Katie.

Couric: Can Chrysler survive bankruptcy?

Nardelli: If we went into bankruptcy it would cause tremendous dislocation in health care, pension, wages, suppliers. So we think - and we've consulted with outside experts to do the cash flows and impact - it would cost us in bankruptcy two to three times more than what we're asking for, Katie, up front.

Couric You came from Home Depot to run Chrysler. You had to be a quick study, but from what you've learned, what was the U.S. auto industry's biggest mistake?

Nardelli: Well I think, look, we've all made mistakes. I've been in business for 38 years, and whether I was at GE or Home Depot or Chrysler, I think the important thing now is to look at this crisis. How do we make sure that we are repositioning ourselves that we break from some of those old paradigms to make sure that we are making new products that we are delivering service to customers, the kinds of cars and trucks they want to drive, have the conficence to drive and will tell their friends about it, Katie.

[bonitalee]

I purchased a 2001 Chrysler Sebring. With 68,000 miles the engine went on February 14, 2009! I talked with several people, including a couple of people who actually work for Chrysler, and they informed me that Chrysler was well aware that they put bad engines in that make and model. Chrysler has not only cost me a car, but on top of that, as a taxpayer, I am now helping to bail out this shoddy company!

I am sure the Chrylser CEO is not loosing any sleep at night. He is still collecting his huge salary and bonuses on top of it all.

I say let them go under! There past business tactics reflect a no good company!!!!!!! You can bet my next car will not be a Chrysler!

[SingerBill]

Watched a recent news release reported new car available India TATA NANO today costs $2000. Same car will not be available in the USA until the year 2012. I wonder why such a car was not first conceived & marketed by our U.S. auto builders. The least expensive new cars available in America are around 10 ? 12 thousand dollars and the U.S. motor companies are complaining that they have so many of these cars back-stocked they will not need further production of small compacts for next couple years ! They declare the reason being the price of gas has gone down & people are more prone to purchase larger cars & pass, on the gas ? sipping compacts. Set their compact car prices at a level all Americans can afford they'd sell all of their back ? stock in short order & need to produce more and need no BAILOUTS ! None of my friends/family who can afford 10 to 30 thousand dollar cars & I?m willing to bet the majority of hard working tax payers in USA find these price tags unaffordable as well. Why isn?t an American manufacturer coming along with a $2000 brand new car that many many Americans would scoop up in a minute for a second car or a car for city commuting ! I am a lot better off than some ($12,000 a year) but we all could use a little sensibility from every CEO of every company that has anything to do with manufacturing goods sold to common everyday Americans like myself.

[payasyougo]

Chrysler CEO: We''ve All Made Mistakes
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So therefore the taxpayer should be held accountable...

[fiberglass3]

newster1 You need to be better informed about electric vehicles. An electric motor has only one moving part.
Vehicles would be charged at night during off peak demand.
Keep driving your Model T powered vehicle.
Cell phone towers were expensive but hey look what happened. Did that burden the power grid also?
I wonder how long you will try to hold back the future technology from happening?

[nothappyatall]

The biggest mistake that the US auto industry made was in not building what we wanted - Electric Vehicles !
The GM EV-1 had a range of 160 miles.
Everyting I own is powered by electric.
Let the future begin NOW

Posted by Fiberglass3"

SURE, if you dont mind and can afford paying $40,000 for 4 wheels and a seat to get to work in, SURE, if you don''t mind the cost of replacing those batteries- some said a $10,000 cost, FINE if you live in a temperate climate and don''t need a really good heater/defroster or A/C. There''s no free lunch- the charging to charge those bateries will come from already overtaxed already near capacity POWER PLANTS and electrical grids- most of which can''t even keep up as it is with summer A/C demand w/o having brownouts, blackouts or putting reductions on commercial businesses during peak use times.

Add a few MILLION electric cars being charged up and watch what happens then! the cost of power WILL go up, the cost of gasoine WILL go up when demand reduces- because they will still need to make money but with less sales= price goes up.
LICO anounced a HUGE rate increase for Long Island power users, it was cited one reason was because people have been conserving and turning lights off, so they are selling less power when they need more profits for salaries, costs, benefits etc, so as a result the cost goes up 10%, so concerve all you like, it will just make prices go up ANYWAY

[mystgreen-2009]

Chrysler''''s Nardelli got a ginormous $200M parachute as a reward for running Home Depot into the ground. I guess what he''''s asking for could be worse? Makes you sort of wonder what the Chrysler''''s Board was thinking when they snagged this business brain!

Posted by Credibility2 at 12:50 PM : Dec 05, 2008

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That''s easy. They want to leverage his ideas on how he accomplished it.

[be_real]

I have owned both Chrysler (Town and Country) and Dodge (Neon) in recent years. The list of problems within the first 5 years were astounding.

Neon: The paint ''''blowing off'''' the Neon within a year, transmission went out, fuel leaks, brake problems, SERIOUS wiring problems

T&C: 2 transmission failures, fuel leaks, windows stopped working, fan stopped working, door locks failed and a plethora of other problems too long to list here in the first 3 years. (A stack of paperwork over an inch high)

I now have a US made Toyota with almost 200K miles on it, no major problems at all.

Posted by Mystgreen at 12:19 PM : Dec 05, 2008



AMERICAN ENGINEERING AT IS BEST

[be_real]

CEO''s salaries - Around $750K - $50K Bonus for good behaviour

[be_real]

CEO''s are not worth the millions of dollars they get pay.......

[credibility2]

Convenient mea culpa from these gents. I''ve made plenty of mistakes, too, but I''m always held accountable. Geez, wonder what their wizardry did for their former companies they ran? Chrysler''s Nardelli got a ginormous $200M parachute as a reward for running Home Depot into the ground. I guess what he''s asking for could be worse? Makes you sort of wonder what the Chrysler''s Board was thinking when they snagged this business brain!

[jj_reinhold]

YES we as humans all make mistakes. Difference is we don''t get bailed out of our mistakes so we can repeat ourselves, and they shouldn''t get the easy way out either!

[jt_lancer]

Isn''t it interesting that none of the foreign automakers with plants in the US are seeking a bailout? Hmmm...

[mystgreen-2009]

I have owned both Chrysler (Town and Country) and Dodge (Neon) in recent years. The list of problems within the first 5 years were astounding.

Neon: The paint ''blowing off'' the Neon within a year, transmission went out, fuel leaks, brake problems, SERIOUS wiring problems

T&C: 2 transmission failures, fuel leaks, windows stopped working, fan stopped working, door locks failed and a plethora of other problems too long to list here in the first 3 years. (A stack of paperwork over an inch high)

I now have a US made Toyota with almost 200K miles on it, no major problems at all.

[txgrouch2007]

But you have to look closely at the Michigan average of $65K where it is largely unionized. There is no doubt at that point what''''s going on.
Posted by Mystgreen at 11:56 AM : Dec 05, 2008

No doubt what''s going on with THAT piece of the puzzle.

But once again, that problem has been known for DECADES.

OH, I GET IT NOW!!! GM has a policy - it doesn''t fix KNOWN PROBLEMS!!! Like when you take your GM vehicle in on the warrantee. They won''t fix it - it''s a KNOWN PROBLEM...

[mystgreen-2009]

Yes, both salary figures are more or less correct in their own way. Another major news company reported a state by state breakdown of average wages in the auto related industry. About $20K annual on the average when you look at all 50 states (51 if you include D.C.). But you have to look closely at the Michigan average of $65K where it is largely unionized. There is no doubt at that point what''s going on.

[blackyowe]

Give up all you salary for 4 years if you give a fig, Mr. Big Shot! No tears here for the Greed Team!

[txgrouch2007]

Good riddance; I plan to dance on that dealer''''s doorstep the day it''''s announced you''''re down the tubes.
Posted by photogeezer at 11:05 AM : Dec 05, 2008

Really, it''s not like NOBODY SAW THIS COMING. Many of us have been wondering WHY IT TOOK SO LONG.

This is just years and years of chickens coming home to roost.

Now they want $100 billion or so to run out to the roost and say "Shoo! Shoo! Go away, chickens."

[photogeezer]

I made the mistake of buying a Chrysler product, based on a Motor Trend review. Every major system in this new car gave me trouble. The dealer staff laughed in my face. "So you think the steering column vibration is bad with the 5-speed; ya oughtta see it on the automatics! Yuk, yuk, yuk" You have very consistently had the worst quality control in the industry. Good riddance; I plan to dance on that dealer''s doorstep the day it''s announced you''re down the tubes.

[txgrouch2007]

Let the future begin NOW.
Posted by Fiberglass3 at 10:01 AM : Dec 05, 2008

Too late. GM sold all it''s electric car patents to the OIL COMPANIES.

If it tries to make electric cars now, they''d have to PAY ROYALTIES TO THE OIL COMPANIES.

What do you think they would charge...?

[easeup-2009]

With all of the talk about them making $70+ an hour, they had to specify "actual pay", because every anti-union person in the country was making the claim that they were making $70 an hour AND benefits.


Maybe if you people would quit trying to make it sound worse than it is, and start using ACTUAL FACTS for a change, you would have a "real understanding" of the issue.

Posted by IwasHungry68 at 09:52 AM : Dec 05, 2008

$70/hr is what each employee COSTS the Big 3--with benefits. Talk about a lack of understanding.....