Cundill Manager Surprised by Chrysler's Cash Flow

I haven't followed the Cundill folks as closely since Peter Cundill retired a while back. But this Dow Jones wire report caught my eye today. David Tiley, one of Cundill's more prominent managers these days, is surprised by Chrysler's improved cash flow.

Cundill owns a significant stake in Exor, an Italian company with a controlling stake in Fiat, which as you know now runs Chrysler:

"The focus on cash flow has exceeded our expectations at Chrysler,"
David Tiley, vice president of investments at Mackenzie Cundill
Investment Management Ltd., told Dow Jones Newswires in a phone
interview.

Based in Vancouver, Canada, Mackenzie Cundill owns nearly 13% of Exor, which in turn owns 30.45% of Fiat.

At the Detroit area presentation of a five-year plan to revive the
U.S. car maker earlier in the day, Chrysler Chief Executive Sergio
Marchionne told reporters that Chrysler had broken even in September
and had accumulated cash. At the end of September, it had $5.7 billion
in cash against $4 billion at the end of June when it came out of
bankruptcy, he said.

Marchionne, who is also chief executive of Fiat, is spearheading
the restructuring after the Italian car maker took a 20% stake in
Chrysler as part of a partnership that could see it increase that stake
in coming years.

Should Chrysler become a viable business again, it would bring
value to Fiat and, in turn, raise the likelihood of a reduction in the
discount at which Exor's stock trades, Tiley said.

After conducting a separate assessment of the value of its assets,
he estimated Exor traded at about a 45% discount. "It is substantially
undervalued," he said.

Regular readers know I took a beating on GM. My exposure to the auto sector is through Superior Industries International (SUP), an auto parts maker.