Chrysler Says It Will Have Nothing to Do With Paper

Detroit News reporters, stonewalled by labor union sources because of a strike at the newspaper, face a new obstacle in covering the city’s major industry.

Chrysler Corp. says its employees will no longer talk to the News, and it has barred News reporters from Chrysler events. The auto maker’s top executives are angry at the newspaper’s coverage of investor Kirk Kerkorian’s efforts to gain control of the company. Chrysler spokesman Steven J. Harris declined to comment, saying: “It’s between us and the Detroit News.”

A story in Tuesday’s News said Chrysler Vice Chairman Thomas G. Denomme summoned News auto editor Bradley A. Stertz to his office Monday and said, “From now on, you, your editors and your journal cease to exist as far as this company is concerned.”

The action followed a front-page News story Sunday that said Chrysler Chairman Robert J. Eaton had warned company employees that quality could be a weak spot in its battle with Kerkorian.

Denomme told Stertz the story “crossed the line,” according to the News’ account, and that the News’ ongoing coverage of the Kerkorian situation has been sensationalistic.

Detroit News Editor and Publisher Robert H. Giles said the newspaper will continue its coverage of Chrysler and Kerkorian. He said the News stands behind the Sunday story, which he said “fairly and effectively” conveyed the substance of the internal Chrysler document on which it was based.

The News’ Sunday story, written by Stertz, was based on a Chrysler memorandum that summarized a Sept. 15 presentation by Eaton to the company’s 400 top executives. The Tuesday edition of the News published the memo in its entirety.

“We need to focus on quality and cost control,” the memo says. “Lower costs . . . more efficiency . . . better quality . . . and a higher return for shareholders as a result. Those are the crucial tactics in this battle.”