Chrysler 2013 Annual Report Download - page 158

157
Consolidated
Financial Statements
at 31 December 2013
7. Restructuring costs
Net restructuring costs amounts to €28 million in 2013 and mainly relates to the restructuring provision in other minor business aggregated
within Other activities in the segment reporting for €38 million, partially offset by the release of a restructuring provision previously made by the
NAFTA region for €10 million.
Net restructuring costs in 2012 amounted to €15 million and related to the EMEA region for €43 million, the Components operating segment
and Other Activities for €20 million. The item also included the release of restructuring provisions previously made by the NAFTA region for
€48 million.
8. Other unusual income/(expenses)
In 2013, Other unusual expenses amount to €686 million and mainly includes write-downs of €272 million as a result of the rationalization
of architectures associated with the new product strategy, particularly for the Alfa Romeo, Maserati and Fiat brands; in particular, €226
million related to development costs and €46 million to tangible assets. In addition, in relation to the market expected trends, the assets
of the cast-iron business in the Components segment (Teksid) were written down by € 57 million. Moreover, there was a €56 million
write-off of the book value of the Equity Recapture Agreement Right considering the agreement closed on 21 January 2014 to purchase
the remaining minority equity stake in Chrysler from the VEBA Trust (as described in the Subsequent events note). Other unusual charges
also includes for 2013 a €115 million charge related to the June 2013 voluntary safety recall for the 1993-1998 Jeep Grand Cherokee and
the 2002-2007 Jeep Liberty, as well as the customer satisfaction action for the 1999-2004 Jeep Grand Cherokee. This item also includes
a €59 million foreign currency translation loss recognized in the first quarter of 2013 related to the February 2013 devaluation of the official
exchange rate of the Venezuelan Bolivar (“VEF”) relative to the US Dollar from 4.30 VEF per US Dollar to 6.30 VEF per US Dollar. During the
second and third quarter of 2013, certain monetary liabilities, which had been submitted to the Commission for the Administration of Foreign
Exchange (“CADIVI”) for payment approval through the ordinary course of business prior to the devaluation date, were approved to be paid at
an exchange rate of 4.30 VEF per US Dollar. As a result, €12 million in the second quarter of 2013 and €4 million in the third quarter of 2013
of foreign currency transaction gains were recognized due to these monetary liabilities being previously remeasured at the 6.30 VEF per US
Dollar at the devaluation date.
In 2012, Other unusual expense of net €138 million mainly included €145 million of costs arising from disputes relating to operations terminated
in prior years and costs related to the termination of the joint venture Sevelnord Société Anonyme.
In 2013, Other unusual income amount to €187 million. This item mainly includes the impacts of a curtailment gain and plan amendments of
€166 million with a corresponding net reduction to Chrysler’s pension obligation. During the second quarter of 2013, Chrysler amended its
U.S. and Canadian salaried defined benefit pension plans. The U.S. plans were amended in order to comply with Internal Revenue Service
regulations, cease the accrual of future benefits effective 31 December 2013, and enhance the retirement factors. The Canada amendment
ceases the accrual of future benefits effective 31 December 2014, enhances the retirement factors and continues to consider future salary
increases for the affected employees. An interim remeasurement was required for these plans, which resulted in an additional €509 million
net reduction to the pension obligation, a €7 million reduction to defined benefit plan assets and a corresponding €502 million increase in
Total Other comprehensive income/(losses).