American Motors Corp. Chairman Roy D. Chapin told some 350 shareholders the beleguered company is in gar better shape than it was 10 years ago despite the record $46 million lost last year. AMC is positioned to take advantage of changes coming in the auto industry, despite a variety of recent bad news, he said.
"We know we can do well in a strong, small-car market, and there's no question that this is coming," Chapin said. "Even without a federal mandate on fuel economy, we will essentially be a smaller nation by the 1980s," he said.
AMC spokesman today independently confirmed that the company will be shutting down most of the its auto manufacturing operations all next week to reduce new-car inventories. There will be 11,000 workers temporarily laid off in the third such week of shutdowns since Jan. 1.
Sounding a note of gentle defiance, Chapin said AMC is "today a much stronger, broader-based company than ever before."
In 1967, when he became chairman, AMC's stockholder equity was $179 million, net sales were $778 million and total assets $378 million.In 1976, stockholder equity was $311 million, sales were $2.3 billion, and assets were nearly a billion dollars.
"In 1967, we were almost 100 per cent dependent on passenger cars; in 1976, 50 per cent of our sales came from operations other than domestic passenger cars," he said.
On a variety of other topics, Chapin made these points:
AMC has an agreement in principles to renew its bank credits of $70 million.
Five-year notes for $20 million held by European investors mature at the end of February and will be paid then.
"In our adjustment, an agreement which recognizes realities of the situation can be reached without discord" with the UAW.
The number of cars AMC has to sell to break even is "very substantially" below what it was a year ago.
The manufacturing equipment and lease on the AMC stamping plant in South Charleston, W. VA., was sold to Volkswagen, generating an undisclosed amount of cash. VW will continue to supply stampings to AMC after it takes over the plant in January 1978.
Chapin also said AMC will have a new line of cars in the luxury smallcar field next fall.
Next year, the company's truck and bus subsidaries will begin making a high-capacity, articulated transit bus and a new family of heavy-duty bus and utility vehicle chassis, he said.