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Zetsche's Admission: Sale Talk Impacting Chrysler

Tuesday, 6 Mar 2007 | 8:19 AM ET

When I walked in with other reporters here at the Geneva Auto Show to talk on the record with Dieter Zetsche, I expected few details on the potential sale of Chrysler . Dr. Z. Did not disappoint. He won't say if there is a timeline for wrapping up the auction process or reveal any of the parties doing serious work studying Chrysler.

He did however admit the Valentine's Day announcement that all options are out there for Chrysler, has impacted the American car company's sales.

"Yes. We have seen an impact. That's quite natural. You put questions in the minds of people about a company, they are going to think about that. It's inevitable. Our job is to re-instill confidence in Chrysler," Zetsche said in 30 minute interview.

This confirms what we've heard about Chrysler's February sales. It's been whispered around Detroit that Chrysler's sales last month included 40% fleet sales. In other words, the company had lots of low profit margin sales of cars to rental car companies, etc, and not as high a percentage of retail sales through dealers.

This shouldn't come as a surprise. Buyers know Chrysler's future is up in the air, so it's easy to see why some people are hesitant to plunk down $20,000 to $40,000 for a new Dodge or Jeep.

The trouble for Chrysler is the longer its future is in doubt, the tougher it becomes to win over buyers. Especially if Chrysler's potential sale is in the news. If Dr. Zetsche and his colleagues at Daimler can move the auction quickly (5-6 months) the quicker Chrysler dealers will have the stability to bring people in to the showroom.

Questions? Comments? BehindTheWheel@cnbc.com

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  • Phil LeBeau is a CNBC auto and airline industry reporter based in the Chicago bureau and editor of the Behind the Wheel section on CNBC.com.

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