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CHRYSLER ANNOUNCES RECOGNITION OF HEALTH CARE ACCOUNTING STANDARD

 HIGHLAND PARK, Mich. -- Chrysler Corporation (NYSE: C) today announced that, effective Jan. l, 1993, it intends to recognize as a one-time charge the transition obligation associated with the adoption of the Statement of Financial Accounting Standard No. 106 (SFAS 106) -- also known as "Employer's Accounting for Postretirement Benefits Other than Pensions" (OPEB). OPEB requires the accrual of certain retiree benefits other than pensions -- primarily health-care benefits -- during the years employees provide services (rather than during the periods the benefits are actually paid).
 Consistent with its prior estimates, recognition of the transition obligation as a one-time charge will result in an approximately $4.7 billion (after applicable income taxes) reduction in its shareholders' equity and in its 1993 first quarter and annual net results. Although implementation of the new standard will result in Chrysler reporting a net loss in the first quarter and for l993 after the effects of this accounting adjustment, it will have no cash impact and will not affect Chrysler's payment of dividends or compliance with its debt covenants.
 Chrysler estimates that its ongoing annual expense for postretirement health and life insurance benefits, after adoption of the OPEB transition obligation as a one-time charge, will increase by $380 million per year on a pretax basis, or by $240 million per year on an aftertax basis.
 -0- 4/5/93
 /CONTACT: Rita McKay of Chrysler, 313-252-8790/
 (C)


CO: Chrysler Corporation ST: Michigan IN: AUT SU:

KE -- DE036 -- 3237 04/05/93 17:51 EDT
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Publication:PR Newswire
Date:Apr 5, 1993
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