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DaimlerChrysler talks of possible break-up

Dr. Dieter Zetsche, center, chairman of DaimlerChrysler and head of Mercedes Car Group, talks at a news conference Feb. 14, 2007, in Auburn Hills, Mich.

BOB MOON: DaimlerChrysler reported fourth quarter earnings today. The German-American auto giant earned $2.45 billion. The Chrysler division lost more than $160 million.

The loss wasn't a big surprise. But some parts of the restructuring plan the auto maker unveiled at the same time were. Alisa Roth tells us more.


ALISA ROTH: Chrysler wants to start earning money again by next year. Doing that will mean closing one plant and cutting shifts at several others. And 13,000 workers will get pink slips.

Today's layoffs are more bad news for the United Auto Workers, which is to renegotiate contracts this summer.

Bill Gould is an emeritus law professor at Stanford and former head of the National Labor Relations Board.

BILL GOULD: Well, I don't think the UAW has very good choices available to it. The best that they can do is arrange for reasonably beneficial terms for buy-outs for the workers who are dislocated.

But Chrysler's workers might face a bigger challenge in the future: for the first time today, Daimler Chrysler is saying that it might consider parting ways with Chrysler.

Economist Steven Szakaly is skeptical.

STEVEN SZAKALY: Wall Street is fascinated with spinoffs because they see dollar signs in it. They love the idea of being able to make money when they brought Daimler Chrysler together and they love the idea of making money when they pull DaimlerChrysler apart.

Szakaly says the only way it could possibly work would be for Chrysler to get bought by another company.

SZAKALY: Particularly for Chrysler, it would be difficult for them to suddenly become a completely autonomous and independent automobile manufacturer.

Word on the street is Nissan and several Chinese companies are already circling.

In New York, I'm Alisa Roth for Marketplace.

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