Big Boost for Hyundai, Audi from Super Bowl Ads
Commercials during the Super Bowl are the Gucci handbags of the advertising world: everyone knows they're expensive - but do you even remotely get your money's worth?
A couple of automakers just might have.
Although Edmunds.com, parent of AutoObserver.com, can't answer for other industries, Edmunds data indicate the big-dollar Super Bowl commercials by Hyundai Motor America Inc. and Audi of America Inc. seem to have connected. Both companies enjoyed outsized spikes in consideration on Sunday after their ads appeared during what is called the most-watched single sporting event on the planet.
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Posted by Michelle Krebs at 1:25 PM under Analysis , Chrysler , Companies , Featured | Comments (0) | digg this | del.icio.us
January Sales: Automakers Joust for New Sales Slots
January car sales had automakers jousting for new positions in the sales rankings.
General Motors retained its No. 1 sales spot. But Toyota's recall and stop-sale order on eight of its best-selling models caused the Japanese automaker to slip to No. 3, behind Ford.
Ford had lost the No. 2 sales spot to Toyota in 2007 and has been fighting to win it back. It closed 2009 by slashing in half the gap with Toyota. This could be the year with Ford gaining momentum and Toyota in reverse with its quality woes.
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Posted by Michelle Krebs at 11:13 AM under Chrysler , Companies , GM , Toyota | Comments (0) | digg this | del.icio.us
January Whacks Toyota, But Sales Firm for Other Makers
The U.S. auto market in January continued its recent strengthening trend, with overall sales just shy of 700,000 vehicles (698,456 vehicles) for the month rising by nearly 7 percent compared with 654,757 vehicles in a very weak January 2009. The seasonally adjusted light-vehicle sales rate ticked up to about 10.76 million units versus last year's 9.59 million - and roughly in line with the firming picture of recent months.
Toyota was clearly the biggest loser in January due to its recalls and stop-sales order on eight of its bestsellers. Yet, January's results varied widely for its top competitors that may have tried to take advantage of Toyota's problems with special incentives meant to lure disaffected Toyota customers in particular.
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Posted by Michelle Krebs at 2:17 PM under Analysis , Chrysler , Featured , Ford , GM , Toyota | Comments (0) | digg this | del.icio.us
Despite Toyota-Fighting Promotions, January Incentives Dip, Edmunds.com Reports
Incentives paid by manufacturers in January dipped below year-ago and December levels despite last-minute promotions by Toyota's competitors to capitalize on the automaker's recall woes.
The average incentive was $2,382 per vehicle sold in January 2010, down $160, or 6.3 percent, from December 2009, and down $326, or 12.0 percent, from January 2009, Edmunds.com estimates.
"January incentives were not particularly generous or compelling - until some automakers began trying to conquest unsettled Toyota owners and shoppers late in the month," stated Jessica Caldwell, director of Industry Analysis for Edmunds.com. "January sales numbers are up from a year ago largely because of fleet sales."
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Posted by Michelle Krebs at 9:41 AM under Analysis , Chrysler , Companies , Featured , Ford , GM , Toyota | Comments (0) | digg this | del.icio.us
January Car Sales: Toyota Share Plummets to Lowest Since 2006
Toyota's market share in January is expected to plummet to lows not seen since 2006, because the automaker issued a stop-selling order on eight models representing more than half of the automaker's U.S. sales this week.
Toyota's share is likely to drop to 14.7 percent of U.S. sales in January, Edmunds.com forecasts; the last time it was that low was March 2006 when its share was 14.2 percent.
In contrast, Ford is expected to have its best month for market share since May 2006. Edmunds.com forecasts Ford's share at 18.0 percent in January. The last time it was that high was in May 2006 at 18.4 percent.
In total, U.S. sales in January, buoyed by hefty hikes in fleet sales and offset by lower retail sales, will total of 701,000 vehicles, according to Edmunds.com's forecast. That would put the Seasonally Adjusted Annualized Rate (SAAR) of car sales at 10.7 million vehicles, down from 11.2 million December but up from 9.6 million in January 2009.
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Posted by Michelle Krebs at 12:57 PM under Analysis , Chrysler , Companies , Featured , Ford , GM , Toyota | Comments (0) | digg this | del.icio.us
Sports Cars Grab Attention of AutoObserver Readers
The best-read post on AutoObserver this week - by a long shot - was an item on Chevrolet
Corvette sales plummeting to a 50-year low in 2009.
As sports car sales in general nosedived, Chevrolet sold only 13,934 Corvettes, the worst sales for the nameplate since 1961 when the car was still in its first generation.
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Posted by Michelle Krebs at 6:55 AM under Analysis , Chrysler , Companies , GM | Comments (0) | digg this | del.icio.us
GM-Style Bankruptcy Sought for Japan Airlines
If it works for General Motors, why not Japan Airlines?
U.S. bankruptcy experts insisted last summer that new laws were being written during government-backed "quick rinse" Chapter 11 proceedings of GM and Chrysler. Now international companies were looking to those bankruptcies as the way to get the job done.
Japan Airlines Corp. (JAL) filed for bankruptcy - Japan's sixth-largest bankruptcy ever - this week. Analysts are looking at GM's bankruptcy to determine how much JAL's investors will be re-paid. Based on the GM scenario, they expect JAL investors to recover 20 to 25 percent of their investment.
Posted by Michelle Krebs at 9:46 AM under Chrysler , GM , News | Comments (1) | digg this | del.icio.us
Fiat Marchionne Faces Tough Sales Job in 2010
At past Detroit auto shows, one could always count on Chrysler to provide the event's glitz and 
glamour with sexy or wild concept cars introduced with theatrical flair, like minivans leaping through the air and Jeeps crashing through glass.
Not so this year. Chrysler held absolutely no press conferences during this week's press preview, and the automaker whipped together a new show stand at the last minute -- one that is simple, clean and noticeably absent of new vehicles.
That void points out the seemingly unwinnable battle Fiat/Chrysler CEO Sergio Marchionne faces in 2010.
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Posted by Michelle Krebs at 6:05 AM under Chrysler , Commentary , Personalities | Comments (1) | digg this | del.icio.us
Makers Cautious as Subdued Detroit Show Starts Pivotal New Year
Most of the energy at this week's Detroit auto show epicentered at Ford Motor Co.'s display, 
with eddies splashing out to General Motors Corp.'s guardedly optimistic stand and Audi AG's gleaming base of operations.
But the majority of automakers were laying low, and media crowds were visibly reduced at the show with a reputation for over-the-top product introductions and boastful talk about the coming year.
There was no avoiding the 2010 Detroit auto show's subdued and geared-down mood, fashioned from the collective attitude of automakers licking their wounds and hoping the worst is past.
It also was yet another evolution of the show itself: there was plenty of room thanks to fewer automakers opting to display and fewer journalists opting (or fewer existing) to attend. A surprisingly expansive area of main-floor real estate was occupied by seemingly inappropriate electric vehicles of all manner, few of them of the road-going passenger variety.
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Posted by Michelle Krebs at 5:49 AM under Chrysler , Companies , Featured , Ford , GM , Personalities , Technology , Toyota | Comments (0) | digg this | del.icio.us
What We'll See at the Detroit Auto Show - And What We'd Like To See
Thanks to the beat-down 2009 threw on almost every automaker, the 2010 installment of the North American International Auto Show in Detroit this week isn't expected to be one of the more ebullient in the storied show's history.
Most makers are laying low. And that's the ones who are even coming. Like last year, many automakers are taking a pass: Nissan and Porsche, for instance.
Many makers let the hometown companies make the biggest splashes, but Chrysler, for one, is displaying vehicles but having no press conference (our hopes remain Chrysler will import some Italian food to feed the media masses).
You can get a rundown of what will be displayed at the Detroit show at Edmunds.com's Inside Line. But we're adding a new twist: in addition to a scorecard of what some automakers are showing at the Detroit auto show, AutoObserver is adding what each automaker ought to be showing.
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Posted by Michelle Krebs at 4:31 AM under Chrysler , Commentary , Companies , Featured , Ford , GM , Toyota | Comments (4) | digg this | del.icio.us
AutoObserver Readers Closely Watch Industry Trends
AutoObserver readers continue to closely monitor the auto industry's sales and incentives trends as illustrated by the most-read posts on AO this week. Those types of posts were also reader favorites for all of 2009.
AutoObserver's report on December car sales, which showed some optimism, topped the chart of most-read posts this week by readers by a long shot.
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Posted by Michelle Krebs at 5:20 AM under Analysis , Chrysler , Companies | Comments (0) | digg this | del.icio.us
December Sales Provide Hopeful Farewell to Last Year
U.S. auto sales in December accelerated to their best pace of the year outside last summer's Cash for Clunkers bonanza, providing a hopeful punctuation mark to the industry's worst year in decades.
Sales in December totaled 1,010,003, up 1.9 percent from December 2008, when automakers and American consumers were newly stunned by the economic debacle unfolding on several levels around them.
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Posted by Michelle Krebs at 8:56 AM under Analysis , Chrysler , Companies , Ford , News , Toyota | Comments (0) | digg this | del.icio.us
Auto Industry Believes 2009 Close Bodes Well for 2010
Some day, automakers hope to look back on 2009 as the year that both sales and corporate fortunes finally bottomed out. It's far too early to tell if history will treat last year that way, but for now, at least, the industry is taking heart from a definite surge of sales momentum as the decade closed.
Automakers sold about 10.4 million units last year, a disastrous tally that comprised the lowest total of light-vehicle sales in this country since 1970.
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Posted by Michelle Krebs at 8:38 AM under Analysis , Chrysler , Companies , Featured , Ford , GM , Toyota | Comments (1) | digg this | del.icio.us
Government To Give GMAC Another $3.5 billion in Aid
GMAC Financial Services, which provides vehicle loans to General Motors and Chrysler dealers and customers, reportedly is close to receiving $3.5 billion in additional aid from the U.S. government, on top of the $12.5 billion already received since December 2008, the Wall Street Journal reports.
The new capital likely will go its ailing mortgage business, not its car-loan business, the paper said.
Posted by Michelle Krebs at 9:27 AM under Business , Chrysler , GM | Comments (0) | digg this | del.icio.us
Ready To Set Record-Low Sales, Chrysler Heads for 2010 in Reverse
A little more than a month after Chrysler Group LLC outlined a new five-year plan to 
restructure and reinvigorate the company as it combines operations with Italy's Fiat S.p.A., the market isn't helping Chrysler's plan look any less overreaching: sales plunged again last month; the company is cutting production and layering on incentives; and the new-product pipeline is scanty as ever.
Chrysler's limping finish to 2009 and dim prospects to start the new year are underscored by this simple fact: when full-year results are tallied, the company will sell less than 1 million units in the U.S. for the first time since 1962.
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Posted by Michelle Krebs at 6:16 AM under Analysis , Chrysler , Featured | Comments (4) | digg this | del.icio.us
The Best and Worst Ideas of 2009
Desperate times require desperate measures, as the saying goes, and 2009 was about as 
desperate as it gets in the auto industry.
Companies sometimes do the most interesting things when they're desperate -- and that maxim seems particularly relevant to auto companies. Because their products are so visible, with such potential emotional impact. Because their executives and designers and engineers are in charge of the process that creates those products.
Desperation in 2009 -- as defined by coming up some 6 million sales short of the industry's glory days of just three years ago -- generated products and strategies that ran the gamut from ridiculous to sublime. Some ideas were inspired; some were just tired.
Here are a few of the best and worst ideas from the auto industry in 2009:
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Posted by Michelle Krebs at 9:22 AM under Chrysler , Commentary , Companies , Featured , Ford , GM , Personalities , Technology | Comments (4) | digg this | del.icio.us
The Decade's Winners and Losers: The Data
Not only is 2009, one of the single most tumultuous years for the auto industry, drawing to a 
close, but so is the first decade of a new century.
As the year winds down, data analysts at Edmunds.com are cranking away at numbers that are certain not only to entertain but also demonstrate how cataclysmic 2009 turned out to be, particularly viewed through the prism of a closing decade's worth of sales-performance trends: market share destroyed, market share gained. Years of growth turned upside down. Surprising sales-volume gains, foreboding losses.
The ever-present import-versus-domestic battle in almost startling perspective.
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Posted by Michelle Krebs at 4:05 AM under Analysis , Chrysler , Featured , Ford , GM , Toyota | Comments (3) | digg this | del.icio.us
The Auto Industry 2009 Wrapup: Apocalypse Now
The best thing that might be said about the year the auto industry - and an economically 
battered nation - is preparing to close: it probably can't get any worse.
The year 2009 brought two high-profile bankruptcies, billions of dollars in government bailouts and funding for Cash for Clunkers and thousands of lost jobs. Similar upheaval - though not as catastrophic as predicted - came to the tightly integrated supplier industry. Several historic brands were relegated to the archives.
And those are just the major stories.
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Posted by Michelle Krebs at 3:57 AM under Chrysler , Companies , Featured , Ford , GM , Toyota | Comments (2) | digg this | del.icio.us
It's (Mostly) Official: $4 Billion of Chrysler TARP Loans a Writeoff
The Chapter 11 bankruptcy reorganization plan filed Tuesday by the company comprised of 
the remnants of the former Chrysler, Old Carco LLC, effectively leaves the U.S. taxpayer on the hook for about $4 billion loaned to the company through the U.S. Department of Treasury's infamous Troubled Assets Relief Program, Reuters reported.
The plan accounts for no payback of the $4 billion "bridge" loan to Chrysler made through TARP in January, prior to its summer bankruptcy, although secured creditors accounting for a mere $20.6 million of the billions in debt the company left behind will be paid in full.
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Posted by Michelle Krebs at 4:07 AM under Chrysler , News | Comments (4) | digg this | del.icio.us
Chrysler Gets Political
Chrysler Group LLC is taking part in an interesting politically-oriented promotion with a TV 
film - opening on the Chrysler brand's Website Thursday - supporting a movement advocating the release of Aung San Suu Kyi, pro-democracy leader in Burma and 1991 Nobel Peace Prize Laureate. Kyi has been under sporadic house arrest for more than two decades.
Chrysler partnered with Lancia Automobiles for the 30-second film originally created for Lancia's sponsorship of the 10th World Summit of Nobel Peace Laureates in Berlin last month.
The theme of the summit was "knocking down new walls and building bridges for a world without violence," to coincide with the 20th anniversary of the demolition of the Berlin Wall.
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Posted by Michelle Krebs at 10:25 AM under Chrysler , In the Media , News | Comments (2) | digg this | del.icio.us
Automakers See Glass Half-Full After Flat November Sales
U.S. auto sales clocked in about flat in November compared with a year ago -- and in line with widespread expectations that the market will only gradually creep upward for at least the next year. But industry executives and analysts mostly chose to interpret the American auto market as a glass half-full.
November sales were 746,544 vehicles compared with 743,605 in November, 2008. On an absolute basis, that number of units represented a 0.4-percent year-to-year monthly sales increase -- or call it flat. But taking into account the fact that the industry enjoyed two fewer "selling days" this year compared with last November, sales actually increased by 9.1 percent last month on an apples-to-apples basis.
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Posted by Michelle Krebs at 3:56 PM under Analysis , Chrysler , Companies , Featured , Ford , GM , Toyota | Comments (2) | digg this | del.icio.us
Renault's Apparent Cold Feet Killed Saturn-Penske Deal, Report Says
Just as General Motors was about to seal the deal to sell Saturn to the Penske Automotive 
Group on Sept. 30, French automaker Renault, which had pledged to supply small vehicles to the venture, backed out, an executive involved in the negotiations told a Detroit newspaper.
Tom LaSorda, retired Chrysler president who was helping Penske negotiate the Saturn-Renault deal, laid to rest any notion that it was Penske who wanted to back out of the deal. "Somebody got cold feet" at Renault, LaSorda told Detroit Free Press columnist Tom Walsh, whose article ran in Wednesday's edition.
"We were shocked," LaSorda told paper in his first public comments on the aborted Saturn sale. In fact, little has been said by anyone involved since the deal went sour.
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Posted by Michelle Krebs at 7:29 AM under Chrysler , GM , News , Personalities | Comments (5) | digg this | del.icio.us
As '09 Inventories Deplete, Who Will Blink First - Carmakers or Customers?
After the sales plunge in the auto market began in earnest in the fall of 2008, automakers scrambled to reduce production schedules, sell off swollen inventories and otherwise deal with a drastically contracting U.S. market.
Now, after months of production cutbacks orchestrated by many automakers and the summer's outsized demand from the $3 billion Cash for Clunkers rebate program, bloated inventories are a thing of the past. Now, data researchers at Edmunds.com say the coming months may be a tug of war between still-cautious buyers and right-sized-but-cash-strapped automakers anxious to hold the line on pricing.
It could be a battle that sees winners and losers on both sides as uncommon market and industry forces collide in what will be an unpredictable sales environment.
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Posted by Michelle Krebs at 6:34 AM under Analysis , Chrysler , Companies , Featured , Ford , GM | Comments (3) | digg this | del.icio.us
Latest Hybrids Probably Won't Help Build the Market
In order to prod soccer moms across the nation to plug a visit to the BMW dealership into their Blackberrys, BMW North America Inc. this week nonchalantly announced the price for its first "full" hybrid-electric vehicle, the ActiveHybrid X6: $89,725.
Welcome to hybridization as seen by German luxury marques, who, given their choices for showcasing hybrid technology, seem to be more intent on using their new hybrids to prove why their diesel-powered models make much more sense in terms of actually appealing to consumers.
At nearly $90,000, the ActiveHybrid X6 has a total of 485 horsepower, weighs more than 5,600 pounds, delivers a 2-mpg improvement over than the 6-cylinder X6 (4 mpg better in the city and 1 mpg worse on the highway than the V8 X6) - and still has plenty of extra-price options.
In the spring, BMW will follow up with the ActiveHybrid 7, the hybridized version of its 7-Series flagship. The car is certain to crack the 6-figure price barrier.
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Posted by Bill Visnic at 9:30 AM under Business , Chrysler , Companies , GM , In the Media , Technology | Comments (1) | digg this | del.icio.us
Tough New Roof Test Whittles Down Field of IIHS 'Top Safety Pick' Winners
A rigorous new roof-strength standard means a lot fewer new models earned the Insurance Institute for Highway Safety's "Top Safety Pick" award for 2010.
This year, just 27 individual models were named Top Safety Pick by the IIHS, compared with last year's record 94 models that earned the award. Most of the reason so many new vehicles couldn't grab the brass ring comes down to a newly instituted roof-safety test presumed to indicate superior protection in rollovers, which are involved in about one-third of all fatal accidents.
"With the addition of our new roof strength evaluation, our crash test results now cover all 4 of the most common kinds of crashes," said IIHS president Adrian Lund in a release. "Consumers can use this list to zero in on the vehicles that are on the top rung for safety."
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Posted by Bill Visnic at 10:00 AM under Business , Chrysler , Companies , Ford , In the Media , News , Technology , Volkswagen, Audi | Comments (0) | digg this | del.icio.us
New GMAC Chief: Become a Premier Auto Finance Company
Michael Carpenter, a board member turned new chief of GMAC Financial Services, vowed to make the company into "a premier auto finance company," something it has not been of late.
Troubled GMAC provides loans to General Motors customers and dealers and eventually will do the same for Chrysler but itself has been living on government loans to survive.
"The top priority is to turn GMAC into a premier auto finance company and pay back the government in a reasonable time frame," Carpenter said. "I am confident we can achieve that."
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Posted by Michelle Krebs at 6:47 AM under Chrysler , Companies , GM , News | Comments (0) | digg this | del.icio.us
TARP Watchdog Reiterates: Billions Loaned to Automakers Likely Lost
Top executives at General Motors Co. and Chrysler LLC have both gone out of their way in the past week to say their once-bankrupt companies are positioning themselves to pay back the tens of billions of dollars loaned to them by the federal government.
The man charged with overseeing the U.S. Dept. of Treasury program through which the money was loaned doesn't share their confidence.
Neil Barofsky, the special investigator assigned by Congress as the watchdog for the $700-billion Troubled Asset Relief Program, said at a conference in Washington D.C. that while GM and Chrysler may pay back some of the approximately $65 billion extended to them, the U.S. probably won't ever see full payback.
"Tens of billions of dollars are likely to be lost on the automotive bailout," Barofsky said flatly.
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Posted by Bill Visnic at 8:10 AM under Business , Chrysler , Companies , GM , News | Comments (2) | digg this | del.icio.us
Some Good Ideas from Chrysler's Turnaround Plan
After a day-long session in which executives from Chrysler Group LLC and its managing 
partner Fiat S.p.A. made public the company's financial and product strategies that will carry it forward for the next five years, the overall impression is of a plan based on optimistic growth assumptions combined with dubious new-product directions.
But not all of Chrysler's five-year outline is unreasonable or illogical. Some aspects, if executed properly and promptly, can help Chrysler distinguish itself from the competition. The three best ideas to come from Chrysler's new business plan: a diesel engine for Jeep; a revamp of Chrysler's mid-size sedans; and a plan to pay back government loans.
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Posted by Michelle Krebs at 3:54 AM under Chrysler , Commentary , Featured , Technology | Comments (2) | digg this | del.icio.us
Chrysler Outlines 'The Plan.' Now, Can it Work?
After Chrysler Group LLC detailed an all-encompassing, five-year business plan to a horde of analysts and the media Wednesday, most left the company's headquarters in Auburn Hills, Mich., wondering whether it was fair to judge the plan outlandish or merely wildly ambitious.
The two critical components to Chrysler's rejuvenation at the direction of 20-percent owner and managing partner Fiat S.p.A.: a) a massive increase in global sales, from 1.3 million units projected for this year to 2.8 million by the plan's finish in 2014; and b) a wholesale but hardly radical refreshening of its product portfolio that will enable the tremendous sales leap.
Chrysler CEO Sergio Marchionne acknowledged the plan's numbers and assumptions invite skepticism. In his closing comments, he enumerated at length epitaphs written for Fiat when he took over as CEO and Fiat was in similar straits.
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Posted by Michelle Krebs at 3:35 AM under Chrysler , Featured , Personalities | Comments (10) | digg this | del.icio.us
Marchionne Disarms Alfa-In-U.S. Speculation, Calls Cost of Coming 300 Platform 'Shocking'
At Chrysler Group LLC's unveiling of its 5-year business plan at its headquarters in Auburn Hills, MI, today, CEO Sergio Marchionne laid to rest a few rumors about the new joining of Chrysler and Fiat S.p.A. One of them was the long-rumored ambition for Fiat to use the alliance to distribute its Alfa Romeo brand in Chrysler's U.S. dealerships.
There is no current plan to sell Alfas in Chrysler dealerships, said Marchionne. In wearing his Chrysler hat (he also is Fiat's CEO) Marchionne insisted that Alfa Romeo would have to "make a convincing case" about which Alfa Romeo models could be profitably exported to the U.S. and sold in Chrysler showrooms.
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Posted by Michelle Krebs at 3:39 PM under Business , Chrysler , News , Personalities | Comments (1) | digg this | del.icio.us
Chrysler and Fiat's Lancia Brands to be Teamed
Outlining a 5-year plan to move Chrysler forward, managing partner Fiat S.p.A. will couple the 
Chrysler brand with Fiat's premium Lancia cars in some international markets.
"Lancia and Chrysler have many things in common," said Michael Manley, Chrysler's president and CEO, Jeep brand and lead executive for international organization, said at Chrysler's presentation of its 5-year business plan Wednesday.
Lancia, he said, has little exposure outside Italy. And most of Chrysler's brands have marginal impact in international markets. But Lancias definitely are Fiat's largest models and also most luxury-oriented, so are most closely aligned with Chrysler.
(Read more...)
Posted by Michelle Krebs at 1:59 PM under Business , Chrysler | Comments (2) | digg this | del.icio.us
Confirmed: Fiat 500 in Some Chrysler Dealers This Time Next Year
At a giant confab Wednesday to unveil its 5-year business plan, Chrysler Group LLC ended months of speculation by detailing how the Fiat 500 subcompact will be initially sold in the U.S.
The 500 - a runaway hit in Europe for Fiat S.p.A., Chrysler's new managing partner and 20-percent owner - will be sold, as a Fiat, in Chrysler dealerships starting late next year. Fiat will sell a North American version of the Fiat 500 Cabrio beginning in 2011 and the Fiat 500 Abarth in 2012.
But perhaps not all Chrysler dealerships. Sales of the 2-door 500 will be sold "mainly" at dealers in metro markets and who carry all Chrysler brands, said Peter Grady, Chrysler's vice president, network development and fleet.
(Read more...)
Posted by Michelle Krebs at 1:08 PM under Business , Chrysler , News | Comments (1) | digg this | del.icio.us
Jeep: Wrangler Anchors the Brand
The original Jeep -- the Jeep Wrangler -- will serve as the anchor of the brand, the brand's 
keeper Mike Manley told the 400 media, dealers and analysts attending the meeting at which Fiat is rolling out Chrysler's five-year plan.
Special models and new derivatives of the Wrangler, including a diesel version, will be offered. But the Wrangler, which continues with body on frame and solid front and rear axles. "The Wrangler is the ultimate expression of the brand," Manley said.
Jeep plans to revamp its current models and add new ones. By 2014, 80 percent of Jeeps will be new or significantly redone.
(Read more...)
Posted by Michelle Krebs at 10:57 AM under Add category , Chrysler , News | Comments (1) | digg this | del.icio.us
Fiat's Marchionne: Chrysler Is Better Off Than Most Think
Fiat CEO Sergio Marchionne, in kicking off a six-hour business meeting outlining Chrysler's 
five-year plan, said Chrysler is in better financial shape than the media and outsiders suggest.
He said Chrysler has boosted its cash reserves by $1.7 billion from the $5.7 billion it had on June 10 when it emerged from Chapter 11 bankruptcy. He said at the end of September the automaker was profitable on an operating basis.
Massive cost reductions have been underestimated, he said, adding the company is downright "cheap" in its spending.
Posted by Michelle Krebs at 9:09 AM under Business , Chrysler , News , Personalities | Comments (0) | digg this | del.icio.us
AutoObserver Twittering from Chrysler Business-Plan Unveiling
Chrysler Group LLC is underway right now with what is one of the year's most crucial auto-industry events: the company's plan moving forward for the next five years under management by Italy's Fiat S.p.A.
Chrysler is revealing new models it's working on, how it plans to fix and improve its existing products and improve its quality and business practices.
AutoObserver is in attendance and editors will be Twittering with highlights throughout the day-long overview.
Follow on Twitter at @AutoObserver
Posted by Michelle Krebs at 8:56 AM under Chrysler , News , Technology | Comments (1) | digg this | del.icio.us
Dodge Lays Out Future Product Plan; Hornet-Like Vehicle, New CUV
Ralph Gilles, Chrysler's head of design and CEO of the Dodge division, laid out the division's future product plan at the marathon meeting outlining Chrysler's five-year plan under Fiat.
The biggest news is that Dodge finally will introduce a new B-segment hatch in the vein of the highly acclaimed Dodge Hornet concept shown some time ago, and Dodge will debut a completely new seven-passenger crossover based on Fiat technology.
(Read more...)
Posted by Michelle Krebs at 8:35 AM under Chrysler , News , Technology | Comments (0) | digg this | del.icio.us
Fiat Engine Tech Impressive - But Would U.S. Buyers Accept the Cost?
In exchange for becoming the operating partner and 20-percent owner of Chrysler Group LLC, Fiat S.p.A. said it would work to incorporate its new efficiency-enhancing powertrain technologies into Chrysler-badged vehicles and other models the two companies may introduce into the U.S. market.
Fiat recently launched one such technology, showing the media the first car powered by an engine using the company's innovative "Multiair" variable-valve timing system.
The technology seems genuinely impressive - it cuts fuel consumption by a solid 10 percent while increasing power and torque by a similar amount - but the car in which the first Multiair 4-cylinder engines are launched, the Alfa Romeo Mito ("me-too") subcompact, are markedly more expensive than most Americans would consider reasonable for such a small car.
The mid-level Mito, with a 133-horsepower Multiair 4-cylinder that most closely matches the power U.S. buyers expect from the 4-cylinder engine in a compact car, costs about £14,645 in the United Kingdom, auto-enthusiast magazine Car reports. In straight exchange-rate conversion, that amounts to about $24,000.
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Posted by Bill Visnic at 12:13 PM under Chrysler , Companies , News , Technology | Comments (4) | digg this | del.icio.us
Italian Design Students Get Real-World Assignment Combining Chrysler, Fiat
While Chrysler and Fiat designers were working quietly behind the scenes to jointly develop 
new models, transportation design students in Italy were doing the same.
The two final vehicles selected by the students to develop into models have been revealed. Perhaps Chrysler will hint at its work with Fiat next week when the American automaker rolls out its five-year plan.
The 37 students in their second year of the three-year car design course at IED Turin in Italy were given the assignment to design vehicles that combined the best technical know-how, the platforms and the values of the Fiat and Chrysler brands.
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Posted by Michelle Krebs at 10:49 AM under Chrysler , Companies | Comments (1) | digg this | del.icio.us
October Is Year's Best Non-Clunker Month for Car Sales, Edmunds.com Forecasts
October car sales are expected to come in at the highest level of the year except for during the summer's frenzied Cash for Clunker months, Edmunds.com forecasts.
Industry sales, being reported on Tuesday, are expected to total 830,000 vehicles, almost even with a year ago and up 11.4 percent from September. That would push October's Seasonally Adjusted Annualized Rate (SAAR) to 10.35 million, up from 9.19 in September.
""There are clear signs that the automotive industry is finally starting to recover from the painful lows experienced earlier this year,"said Jessica Caldwell, Edmunds.com's director of Industry Analysis.
(Read more...)
Posted by Michelle Krebs at 4:59 AM under Analysis , Chrysler , Featured , Ford , GM | Comments (2) | digg this | del.icio.us
Former Chrysler Sells Delaware Durango Plant; GM Sells Its Delaware Plant
The state of Delaware was the scene of some historic and trend-setting events this week, as the "old" business entities of General Motors Co. and Chrysler Group LLC both sold cast-off assembly plants as the companies as part of the companies' rapid downsizing.
The site of Chrysler's assembly plant in Newark will be sold to the University of Delaware for a new research center. The plant, which most recently built the Dodge Durango and Chrysler Aspen SUVs, was sold to the university for $24.25 million, according to the Delaware News Journal.
(Read more...)
Posted by Michelle Krebs at 5:43 AM under Business , Chrysler , GM | Comments (0) | digg this | del.icio.us
COMMENTARY: Pay Czar on Board
General Motors Co. and Chrysler Group LLC executives are having their salaries cut - and like the often petulant professional-sports millionaires their typically outsized senses of worth so closely resemble - are at the same time getting some religion about responsibility and selfishness.
By now, anybody interested probably knows the details: direct salary for each company's token top 20 or 25 executives is cut an average of 31 percent at GM and about 18 percent at Chrysler. Salaries exceeding $500,000 are all but verboten. Instead, the big money that Detroit execs used to nail down just for phoning it in now is tied to longer-term company performance.
There's a notion.
(Read more...)
Posted by Michelle Krebs at 6:49 AM under Chrysler , Commentary , GM | Comments (1) | digg this | del.icio.us
Chrysler Looking to New Big Rams to Haul in Some Cash
Chrysler Group LLC's Dodge Ram pickup has been the company's biggest - literally and 
figuratively - success story since the launch of the "big rig"-looking light-duty Ram in 1993. That new-generation Ram reinvigorated Chrysler's market share in the segment in which it was a distant No. 3 in a two-company race.
Now Chrysler needs the Ram to come through again. The new, 2010 Heavy Duty variant of the Ram coming to showrooms next month is the first genuinely fresh product Chrysler has launched since emerging from bankruptcy in early June and many analysts believe Chrysler - starved for new product and with few meaningful prospects in its near-term pipeline - could use a boost for what is widely believed to be a cashflow-poor bottom line.
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Posted by Michelle Krebs at 4:22 AM under Chrysler , Featured | Comments (0) | digg this | del.icio.us
Manufacturers Offer Richest Incentives Since Cash for Clunkers
After dismal September car sales due to the hangover from the government's Cash for 
Clunkers program, auto manufacturers have ramped up incentives in October as they have ramped up production to refill the inventory pipeline, according to Edmunds.com.
The incentives show manufacturers are extremely eager to sell off 2009 models left in inventory. But automakers are also offering incentives on newly launched 2010 models.
"This year has been a wild ride for automakers, and it's not over yet," said Edmunds.com Senior Analyst Jessica Caldwell. "No segment is unaffected by the current round of incentives, though luxury models and trucks are being discounted particularly heavily."
Low-interest financing, including zero-interest financing, and cash rebates dominate the landscape, but subsidized lease programs, almost non-existent in the past years, are proliferating as well.
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Posted by Michelle Krebs at 6:43 AM under Analysis , Chrysler , Companies , Featured , Ford , GM , Technology , Toyota | Comments (0) | digg this | del.icio.us
Fiat Expected to Report 3Q Profit
Italian automaker Fiat, which now runs Chrysler, is expected to report an operating profit 
Wednesday for the third quarter.
Little information is expected to be provided regarding Chrysler's financial situation in Wednesday's Webcast, however. Instead, Fiat will roll out its five-year plan for Chrysler on Nov. 4.
(Read more...)
Posted by Michelle Krebs at 9:49 AM under Business , Chrysler , Companies | Comments (0) | digg this | del.icio.us
COMMENTARY Memo to Detroit Auto Bosses: Hold Your Tongue
Put up or shut up, albeit in more polite European terms, is basically financial columnist Antony Currie's advice to Detroit's auto bosses.
The Big Three bosses have returned to one of their favorite past times, writes Currie on the financial blog site, Breakingviews.com: "... each of the Big Three's bosses has been indulging in painting rosy scenarios for their firms. But like pronouncements of the past, they're a tad premature."
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Posted by Michelle Krebs at 9:48 AM under Chrysler , Commentary , Ford , GM , Personalities | Comments (2) | digg this | del.icio.us
Ford's Better Idea: Keep An Eye on the Italians
Caught recently at Ford Motor Co. headquarters in Dearborn, Mich.: a Fiat Bravo 5-door in 
the employee parking area.
But not just any employee - the small sign at the right reads "Vice President."
If Ford's crosstown rival Chrysler Group LLC - now managed by partial owner Fiat S.p.A. - gets its way, there are going to be Chrysler -- and probably Fiat-badged subcompacts sold in the U.S. within two years that could rely on some variant of the Bravo underpinnings.
(Read more...)
Posted by Michelle Krebs at 3:59 AM under Business , Chrysler , Companies , Ford | Comments (5) | digg this | del.icio.us
Automakers Eager to Move Past September's Tepid Sales
U.S. auto sales in September dipped to predicted lows because the Cash for Clunkers program ended in August and there weren't many buyers left, car company executives reported Thursday. They're just hoping that the market's massive "payback" via September's sales drought isn't extended into the fourth quarter.
Americans bought just 745,516 vehicles in September, a 23-percent drop from a year ago. That represents an abysmal Seasonally Adjusted Annual Rate (SAAR) of sales of just 9.2 million units - the lowest since February and roughly the laconic pace at which economically shell-shocked consumers purchased cars during the first half of the year.
And it was far below -- 41 percent, to be exact -- the relatively breathtaking sales rate of 14.1 million units that prevailed for August, when most buyers took advantage of a total of $3.5 billion in rebates under the federal government's clunkers program and purchased more fuel-efficient vehicles. September's sales volume plunged by more than a half-million units compared with August.
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Posted by Michelle Krebs at 9:28 AM under Analysis , Chrysler , Companies , Featured , Ford , GM , Toyota | Comments (13) | digg this | del.icio.us
Incentives on the Rise through Year-End, Edmunds.com Predicts
After five straight months of decline, incentives are on the rise again, according to Edmunds.com.
The average manufacturer incentive totaled $2,557 per vehicle sold in September, up $83 or 3.4 percent from August, Edmunds.com estimates. That was down $344, or 11.9 percent from September 2008.
This summer's Cash for Clunkers program substituted as a manufacturer incentive but with the program over and vehicle inventories being replenished, consumers aren't buying, as will be seen when automakers report September sales Thursday. Edmunds.com forecasts sales for the month will come in at only about a 9.3 million Seasonally Adjusted Annual Rate (SAAR).
Now customers need a reason to buy.
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Posted by Michelle Krebs at 7:22 AM under Analysis , Chrysler , Companies , Featured , Ford , GM , Toyota | Comments (0) | digg this | del.icio.us
Soft Sales Test Automakers' Resolve to Restrain Incentive Spending
Automakers will have their resolve to scaleback incentive 
spending tested in the coming months as their assembly plants ramp up production to beef up inventory and sales continue to be soft.
Incentives on General Motors, Ford and Chrysler vehicles plummeted by 26 percent to $3,278 per vehicle in August from a March peak, according to Edmunds.com, parent of AutoObserver.com. Industrywide incentives fell 22 percent to $2,474 per vehicle.
"Automakers have to pull the lever and increase production in an unknown market," Edmunds.com Senior Analyst Jessica Caldwell told Bloomberg News. "They could find there are no buyers out there and have to raise incentives again. It's a vicious circle."
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Posted by Michelle Krebs at 6:03 AM under Analysis , Chrysler , Companies , Ford , GM | Comments (2) | digg this | del.icio.us
Chrysler Midsize-Car Signals: Venal or Visionary?
Media reports have Chrysler Group LLC making a possible about-face on its pledge to close 
the Sterling Heights, Mich., assembly plant of its low-performing Chrysler Sebring and Dodge Avenger midsize sedans and convertible. The move by Chrysler's 20-percent owner and managing partner Fiat S.p.A. could signal it has few near-term tactical options to turn around the flagging Chrysler.
Or that it is crazy like a fox.
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Posted by Michelle Krebs at 4:00 AM under Chrysler , Companies , Featured | Comments (5) | digg this | del.icio.us
September Car Sales on Track for 9.3 Million Rate, Edmunds.com Forecasts
September's hangover from August's Cash for Clunkers program appears to be easing.
New vehicle sales for the month are expected to total 742,000 units, off 22.9 percent from September 2008 and down 41.1 percent from August when Cash for Clunkers was in full swing, according to Edmunds.com's forecast. That would put the Seasonally Adjusted Annual Rate (SAAR) of sales at 9.34 million vehicles. Automakers report U.S. sales on Oct. 1.
"The aftereffects of Cash for Clunkers are still being felt: a significant number of September sales were pulled ahead into August, and many September shoppers left showrooms empty-handed after finding low inventories and high prices," said Edmunds.com CEO Jeremy Anwyl. "However, the industry's sales rebound is gaining momentum, so there is room for a small upside surprise on sales announcement day."
(Read more...)
Posted by Michelle Krebs at 6:09 AM under Analysis , Chrysler , Companies , Featured , Ford , GM , Toyota | Comments (1) | digg this | del.icio.us
Chrysler Puts Pedal to the Metal on New Models, Report Says
Addressing its glaring problem of an empty product pipeline, Chrysler will do a speedy makeover of at least five models by mid-2011, along with 
introducing the 2011 Jeep Grand Cherokee and redesigned Chrysler 300 that year, as part of a five-year plan reportedly being submitted to the automaker's board by Fiat CEO Sergio Marchionne on Friday.
The Detroit Free Press reports Marchionne wants makeovers accomplished within a quick 18 months on the Chrysler Town & Country and Dodge Caravan minivans; the Dodge Caliber, Jeep Compass and Jeep Patriot compact crossovers; and the Chrysler PT Cruiser, which Fiat revived from the to-be-killed list.
The Fiat 500 minicar will be built at the Toluca, Mexico, plant that also assembles the PT Cruiser, for a mid-2011 U.S. introduction, the newspaper reported.
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Posted by Michelle Krebs at 5:04 AM under Chrysler , Featured , News , Personalities | Comments (1) | digg this | del.icio.us
Fiat's Guy To Run Chrysler Powertrain; Hemi Future Cloudy
Chrysler Group LLC 20 percent owner and managing partner Fiat S.p.A. continues to import 
its home-grown management to run Chrysler's U.S. operations, Tuesday naming another Fiat executive to a key Chrysler management position.
The company said a "realignment" of Chrysler's powertrain department brings Paolo E. Ferrero as senior vice president of Chrysler Powertrain. Ferrero apparently replaces Bob Lee, a popular Chrysler executive who has spent his entire career at Chrysler and most recently was head of powertrain engineering. Chrysler told Automotive News late Tuesday that Lee remains employed by Chrysler.
Lee, who holds mechanical engineering and MBA degrees, is widely recognized as the "father" of the new-age Hemi V8, which was launched for the 2003 model year and went on to become an icon for the company and a performance benchmark for the industry.
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Posted by Michelle Krebs at 5:38 AM under Business , Chrysler , Commentary , Companies , Featured , Personalities | Comments (2) | digg this | del.icio.us
Commentary: Does Anybody "Get" Chrysler?
Monday's report from Business Week that Chrysler LLC is tasking account-seeking advertising agencies with positioning Chrysler-brand vehicles as "premium" choices indicates new manager Fiat S.p.A. has no more clue about what Chrysler represents in the U.S. than did the company's most-recent other inept foreign owners -- Daimler AG.
Chrysler has heritage as an upscale brand, but that image died by at least the 1970s, the same time most all memories of Detroit's long hoods and tailfins well and truly were overwhelmed by the leaner, meaner imports from Europe and Japan. Ask rival General Motors Co. what its Detroit lead-sled heritage has done for the company lately.
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Posted by Michelle Krebs at 4:04 AM under Chrysler , Commentary , Featured | Comments (16) | digg this | del.icio.us
Edmunds.com Final Tally: Cash for Clunkers Buys, Trades; Ford Focus No. 1 Buy
Edmunds.com has completed its final tally of the most popular vehicle purchases and most 
frequent trade-ins under the Cash for Clunkers. The Ford Focus held its No. 1 spot as the favorite buy; the Ford Explorer remained the No. 1 trade-in.
Indeed, the top 10 lists in both categories wound up little changed from the early scoring on Edmunds.com's lists.
And, in fact, many of the top clunker buys are the industry's bestsellers in non-clunker times. Eight of the 10 vehicles on the top 10 clunker buy list are also in the top 10 for the year so far in total; only the order is changed.
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Posted by Michelle Krebs at 5:20 AM under Analysis , Chrysler , Companies , Ford , GM , Toyota | Comments (0) | digg this | del.icio.us
Hyundai, Mitsubishi Out of Chrysler Engine-Making JV
Two of the three partners in the Global Engine Manufacturing Alliance are bowing out, leaving Chrysler Group LLC with a four-cylinder global engine family and lots of engine production 
capacity at a highly efficient plant in Dundee, Michigan
Hyundai Motor Co. and Mitsubishi Motors Corp. cut their ties with the GEMA venture last month, selling their shares to Chrysler for an undisclosed amount. The Dundee site began producing the jointly developed engines in October 2005. While two plants in Asia also produced the engines for Mitsubishi and Hyundai, the plan was for the two companies to also take engines supplied by the Dundee GEMA plant for vehicles Hyundai and Mitsubishi built in North America.
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Posted by Michelle Krebs at 4:16 AM under Analysis , Chrysler , Companies , Technology | Comments (1) | digg this | del.icio.us
U.S. Taxpayers Can Kiss Some GM, Chrysler Loans Good-Bye
An independent panel overseeing the government's loans to General Motors and Chrysler has revealed that U.S. taxpayers probably won't be entirely paid back by the two just-out-of-bankruptcy automakers.
The Congressional Oversight Panel (COP), in its latest report issued Tuesday, said it is highly unlikely that the government will recover all of the $81 billion in loans to the auto industry. The panel did not say exactly how much in total it expected to recover.
The report did say Chrysler is "highly unlikely" to repay $5.4 billion of its $15 billion in government loans, and GM probably will pay back little of the initial $19.4 billion of its total $50 billion in government loans. In a statement, GM insisted it intended to pay back the loans.
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Posted by Michelle Krebs at 8:50 AM under Chrysler , Companies , Featured , GM , News | Comments (4) | digg this | del.icio.us
Ongoing Payback of Government Bailouts Will Focus Scrutiny on GM, Chrysler
Since early this summer, a handful of the nation's large banks starting paying back their share of emergency bailout loans taken under the controversial, $700-billion Troubled Asset Relief Program fund created by the Bush Administration last year. T
It was reported recently that eight major banks and investment firms that received TARP loans have repaid - and that the U.S. Department of Treasury's profit was about $4 billion and a tidy 15-percent return on the investment.
Although the money repaid represents only a small portion of the TARP funds extended to scores of banks large and small, some banks' prompt repayment is certain to lead the discussion to General Motors Co. and Chrysler Group LLC, two non-banks - along with their closely-aligned financing operations - that were extended a collective $65 billion in TARP funding.
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Posted by Michelle Krebs at 10:59 AM under Chrysler , Commentary , Companies , GM | Comments (0) | digg this | del.icio.us
'Small' Could be the New 'Big' of the Pickup Market
Maybe America's love affair with pickup trucks isn't over. It's just getting smaller.
In both size and volume.
The recently ended federal Cash for Clunkers incentive was a giant boost for fuel-efficient cars. They dominated the top 10 list of new vehicles purchased by those trading clunkers. But if August sales reports are any indicator, more than a few of those Cash for Clunkers vouchers were used to buy midsize (formerly "compact") pickups.
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Posted by Michelle Krebs at 4:40 AM under Analysis , Chrysler , Companies , Featured , Ford , GM , Toyota | Comments (1) | digg this | del.icio.us
Post-Clunkers Second Half Becomes Huge Sales Question Mark
The U.S. government's Cash for Clunkers program finished its job in August, boosting industry-wide U.S. sales to 1,261,799 vehicles, a 1.3-percent increase from a year earlier and a 26.7-percent boost from July, as American consumers rushed dealerships to turn in their well-used vehicles for more fuel-efficient new ones.
Automakers revisited long-abandoned, almost heady levels of sales, with the August results translating into a Seasonally Adjusted Annual Rate of 14.1 million units - equivalent to a yearly pace about five million units faster than the sales rate for the first half of this year, and much higher than the 10.5-million to 11-million-vehicle pace that industry executives still expect to prevail for the rest of 2009.
(Read more...)
Posted by Michelle Krebs at 9:57 AM under Analysis , Chrysler , Companies , Featured , Ford , GM , Toyota | Comments (0) | digg this | del.icio.us
Automakers Spend Less on August Incentives, Thanks to Cash for Clunkers
With American taxpayers footing the bill for Cash for Clunkers, automakers were able to lower their spending on incentives in August. And, in fact, automakers may still have paid more than they needed to in incentives.
The average automotive manufacturer incentive was $2,475 per vehicle for every vehicle sold in August, Edmunds.com estimates. That's down $231, or 8.5 percent, from July and down $327, or 11.7 percent, from August 2008, continuing a downward trend of several months.
"The industry spent a record $3,165 per vehicle in March, but ever since then, incentives have continuously fallen," said Jessica Caldwell, Edmunds.com's director of Industry Analysis.
However, the story may change in the coming months, she added, with the Cash for Clunkers program over, vehicle inventories low due to production cutbacks and brisk clunker sales. But now, factories are ramping up production to fill up the pipeline again -- production that may come into a market that isn't in the mood for buying.
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Posted by Michelle Krebs at 7:36 AM under Analysis , Chrysler , Companies , Featured , Ford , GM , Toyota | Comments (0) | digg this | del.icio.us
Fiat-Chrysler Signaling Early Strategy Moves
Led by new CEO Sergio Marchionne, Chrysler Group LLC management reportedly will report 
next month to its newly appointed board of directors about how managing owner Fiat S.p.A. plans to begin meshing the two companies' operations to move Chrysler forward in the U.S. market.
Marchionne is expected to lead a briefing of the 9-member Chrysler board that has individuals appointed by Fiat, the U.S. Department of Treasury (because of Chrysler's acceptance of billions in loans from the government's Troubled Assets Relief Program) and the United Auto Workers union (which has a minority ownership in Chrysler), according to Bloomberg News reports.
(Read more...)
Posted by Michelle Krebs at 5:59 AM under Chrysler , Companies , Featured | Comments (1) | digg this | del.icio.us
August Car Sales: Wild Roller Coaster Ride
Thanks to the government's Cash-For-Clunkers program, new-vehicle sales bounced around throughout the month of August, one of the most volatile periods in automotive history. Edmunds.com predicts the annualized sales rate could land at just more than 13 million for the month.
"Cash for Clunkers sent the sales rate on a wild roller coaster ride," said Edmunds.com Senior Analyst Jessica Caldwell. She said the Seasonally Adjusted Annualized Rate (SAAR) of sales exceeded 19 million in late July - the peak of Cash-For-Clunkers selling - and fluctuated around the 15-million mark in early August. But the SAAR has plunged to an 8-million rate in the post-Clunkers final days of the month.
"Ending August on such a low note does not bode well for September," Caldwell warned.
(Read more...)
Posted by Michelle Krebs at 6:48 AM under Analysis , Chrysler , Companies , Featured , Ford , GM , Toyota | Comments (2) | digg this | del.icio.us
Post 'Clunkers,' Automakers Raising Production - Carefully
Prior to the Cash-For-Clunkers sales explosion, the last thing automakers would have considered was increasing production in their North American factories.
In answer to the worst industry sales slide in more than a generation, most had for more than a year being doing just the opposite - slashing production schedules - in an attempt to reduce bloated inventories suddenly and catastrophically out of line with consumer demand.
But Cash-For-Clunkers changed all that: in just four weeks, the federal incentive program squeezed more than a half-million buyers into showrooms. So much for that troublesome inventory.
Now the auto industry has to deal with the wholly unpredicted consequence of Cash-For-Clunkers' success: almost overnight, nobody has enough new vehicles to sell. And the equally ironic solution: raise production.
(Read more...)
Posted by Bill Visnic at 3:00 AM under Analysis , Chrysler , Companies , Featured , Ford , GM | Comments (2) | digg this | del.icio.us
Report: Chrysler's Press Is Out
The Wall Street Journal reported Friday afternoon that Chrysler Group LLC Deputy Chief Executive Jim Press will leave the company sometime before the end of the year.
It had been widely speculated that the ever-optimistic Press -- who served as Chrysler president under majority ownership of Cerberus Capital Management LLC and prior to the company's Chapter 11 bankruptcy -- would leave not long after the company's post-Chapter 11 restructuring and resulting management control by Italy's Fiat S.p.A.
Press has been serving as special advisor to Fiat and Chrysler CEO Sergio Marchionne.
Marchionne already has been at work reorganizing Chrysler's executive ranks in a structure based on better supporting the company's Chrysler, Dodge and Jeep brands.
Neither Chrysler or Press would confirm the news. Press, prior to his Chrysler stint a longtime, high-ranking executive at Toyota Motor Corp., told the WSJ, "I don't think anything has been released about management changes."
Posted by Bill Visnic at 11:24 AM under Chrysler , News , Personalities | Comments (0) | digg this | del.icio.us
Cash for Clunkers Drives Consumers to Fuel-Efficient Choices, Edmunds.com Reports
Should the federal government fund a Cash for Clunkers extension, and is it worth the added
$2 billion cost as an economic and environmental stimulus?
Those are the questions the Senate considered this week as it debated the extension the House already passed. Data based on real Cash for Clunker transactions by Edmunds.com shows clearly vehicles turned in as clunkers -- mostly gas-guzzling trucks and SUVs -- would have been traded in at some point even without the program.
However, those vehicles were traded for vehicles that were more likely to be cars than trucks or SUVS and vehicles that deliver better fuel economy with the $3,500 to $4,500 government vouchers provided under the Car Allowance Rebate System (CARS).
Further, the clunker plan appears to have had a rub-off effect. The program created a feeding frenzy, with the last week of July generating a seasonally adjusted selling rate of a stunning 19.6 million vehicles. And those consumers buying vehicles regardless of trade-ins opted for smaller, more fuel-efficient cars during the Cash for Clunker program at a higher than usual rate.
(Read more...)
Posted by Michelle Krebs at 12:34 PM under Analysis , Chrysler , Companies , Featured , Ford , GM , Toyota | Comments (4) | digg this | del.icio.us
Cash for Clunkers Delivers July Sales Spike -- But Now What?
The crescendo of activity in American auto showrooms around the Cash for Clunkers program late last week produced a correspondingly huge surge in U.S. auto sales, and consumers kept scrounging through the weekend for fuel-efficient vehicles to buy under the generous government rebates.
Consequently, sales for all of July for the industry came up only 12 percent short of their level a year ago - when $4-a-gallon gasoline also was goosing shopper interest in fuel-efficient vehicles.
(Read more...)
Posted by Michelle Krebs at 12:09 PM under Analysis , Chrysler , Companies , Featured , Ford , GM , Toyota | Comments (9) | digg this | del.icio.us
Chrysler To Continue With Cruiser; Plans With Fiat Changing?
Chrysler Group LLC said Friday it will continue production of the PT Cruiser compact wagon, although the company announced more than 18 months ago the car would be discontinued.
Chrysler restarted production in mid-June at the Toluca, Mexico, assembly plant that builds the PT Cruiser and the Dodge Journey crossover. It was one of seven Chrysler plants to resume production after an extended temporary shutdown as Chrysler dealt with ongoing inventory difficulties and its eventual bankruptcy and change in ownership.
(Read more...)
Posted by Michelle Krebs at 5:40 PM under Analysis , Chrysler , News | Comments (0) | digg this | del.icio.us
COMMENTARY Cart-Before-Horse Alert: Gov Plans Quick Sell of GM, Chrysler Stakes
With a combined $65 billion invested in the turnarounds of General Motors Co. and the
Chrysler Group LLC, the federal government Monday expressed an optimism for those companies' future that would have made their own executives blush: Ron Bloom, new chief of the Presidential Task Force On Autos, said the feds want to recoup the taxpayer dough as soon as possible after GM's planned initial public offering next year.
An IPO? That can generate billions? Next year?
Huh?
(Read more...)
Posted by Michelle Krebs at 5:14 AM under Chrysler , Commentary , Featured , GM | Comments (2) | digg this | del.icio.us
Fiat Loses $238 Million in Second Quarter
Italian automaker Fiat, the new owner of Chrysler, reported Wednesdsay that it lost the equivalent
of $238 million in the second quarter, due to dramatic decline in vehicle sales, especially for trucks and commercial vehicles, from a year ago, when it turned a profit.
"The global economic crisis continued to have a significantly negative impact on demand levels for all the group's business, but with signs of improvement in certain markets compared with Q1 levels," Fiat said in a statement.
Still, Fiat said results improved from the first quarter, with losses narrowing from quarter to quarter. And company executives said they expect improvement through the remainder of the year.
Posted by Michelle Krebs at 10:33 AM under Chrysler , Companies , News | Comments (0) | digg this | del.icio.us
Chrysler Offers Incentive Equal to Cash for Clunkers Vouchers to Everyone
AUBURN HILLS, Michigan -- Chrysler Group LLC will offer incentives up to $4,500 -- the
maximum amount of vouchers issued to qualified buyers under the government's Cash for Clunkers
program -- to all consumers.
Beginning Thursday and ending August 31, Chrysler will offer $4,500 cash rebates or zero-percent financing for 72 months through GMAC Financial Services on most 2009 models.
Customers who take advantage of the government Cash for Clunkers program, officially known as Car Allowance Rebate Systems (CARS), also qualify for the rebates and financing in addition to receiving credit for the vouchers, which range from $3,500 to $4,500. That means the Cash for Clunkers customer could chop $9,000 off his or her new car purchase.
(Read more...)
Posted by Michelle Krebs at 6:40 AM under Chrysler , News | Comments (6) | digg this | del.icio.us
Strange Automotive Bedfellows, 2009 Edition
By Bill Visnic
There are plenty of strange auto-industry tie-ups to get accustomed to this year, such as internal-combustion innovator Daimler AG and electric-car impresario Tesla Motors Inc., or, well, Chrysler Group LLC and Fiat S.p.A.
But one of the weirder six-degrees-of-separation connections of the year is between Steve Rattner, now-retired czar of the Presidential Task Force On Automobiles and Cerberus Capital Management, former majority owner of Chrysler.
(Read more...)
Posted by Michelle Krebs at 4:24 AM under Chrysler , Companies , Personalities , Rumors | Comments (0) | digg this | del.icio.us
House Passes Bill To Make GM, Chrysler Reinstate Dealers
The U.S. House of Representatives approved a plan to restore franchise agreements with dealerships canceled by General Motors and Chrysler during their bankruptcy proceedings.
The automakers as well as President Obama and his task force opposed the provision in a spending bill that is part of the 1020 fiscal year budget beginning Oct. 1 and was passed 219 to 208 Thursday.
(Read more...)
Posted by Michelle Krebs at 8:53 AM under Chrysler , GM , News | Comments (5) | digg this | del.icio.us
GM, Chrysler Still Weak As Ford Could Win Share, Report Forecasts
General Motors and Chrysler will be challenged by weak future product plans while Ford
stands to gain market share with a relatively strong future product plan, a new report says.
Called Car Wars, the annual competitive analysis is produced by Banc of America Securities-Merrill Lynch and reported on by the Detroit Free Press Thursday, predicts:
- GM's market share losses will be greater than the automaker expects because of its skimpy future product plan;
- Chrysler's weak product pipeline is "an ominous sign"
- Ford's relatively strong future product plan could help it gain market share.
(Read more...)
Posted by Michelle Krebs at 8:03 AM under Analysis , Chrysler , Ford , GM | Comments (3) | digg this | del.icio.us
Consumers Find New, Remade Models More Appealing Than Ever, J. D. Power Finds
By Michelle Krebs
Like Sally Field when accepting her Best Actress Oscar, consumers seemed to be saying of
their new and redesigned vehicles "You like me ... you really like me."
Indeed, J. D. Power and Associates 2009 APEAL study, released Thursday, consumer satisfaction with their new and redesigned models at a three-year high. Report highlights include:
- Porsche ranked highest among nameplates for a fifth consecutive year;
- Volkswagen captured four segment-level awards--more than any other vehicle nameplate in 2009;
- new and redesigned models scored higher than last year's new and redesigned models and higher than this year's carryover models.
- seven new and redesigned models ranked highest in their respective segments: Dodge Challenger; Ford F-150; Ford Flex; Hyundai Genesis; Nissan Maxima; Volkswagen CC and Volkswagen Tiguan.
(Read more...)
Posted by Michelle Krebs at 7:07 AM under Analysis , Chrysler , Companies , Featured , Ford , GM , Toyota | Comments (1) | digg this | del.icio.us
Mission Accomplished: Auto Task Force Could Be History
This week's departure of Steven Rattner from President Obama's automotive task force suggests the panel soon could be dissolved now that General Motors and Chrysler have emerged from bankruptcy.
The possibly imminent dissolution of the task force suggests what its members and President Obama have insisted all along - but have not been believed - that they do not want to run the day-to-day business of GM and Chrysler
(Read more...)
Posted by Michelle Krebs at 9:59 AM under Business , Chrysler , GM , Personalities | Comments (0) | digg this | del.icio.us
Auto Manufacturing Could Give Factory Output Boost From 12-Year Low
U.S. industrial production is being dragged down by the lowest auto and auto parts
manufacturing in more than a decade, but it could get a boost from vehicle output as plants crank up production in the coming months.
The government reported Wednesday that U.S. industrial production fell again in
June for the 17th consecutive month to its lowest level since July 1998.
But good news was the drop was smaller than experts had forecasted and it was the smallest decline in more than a year, suggesting manufacturing is stabilizing.
The automotive sector continued to drag down all factory output because of extended General Motors and Chrysler factory shutdowns during their bankruptcies. However, a major bump in vehicle production is expected this quarter.
(Read more...)
Posted by Michelle Krebs at 9:20 AM under Analysis , Chrysler , Companies , GM | Comments (0) | digg this | del.icio.us
House Committee Votes To Restore Terminated Dealer Franchises
WASHINGTON -- A bill approved by the Appropriations Committee of the U.S. House of Representatives requires General Motors and Chrysler to restore franchise agreements with auto dealerships they terminated as part of their bankruptcy proceedings.
U.S. Rep Steve LaTourette, R-Ohio, who sponsored the bill, said the automakers failed to show cost savings associated with having fewer dealers and called the White House backing the elimination of dealers as "un-American."
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Culture Clash, Part 2: Chrysler Small-Car Big-Wig Outta There
By Bill Visnic
First it was Americans and Germans who couldn't make it work at Chrysler Group LLC. Now it might be Germans and Italians having trouble finding the love while mutually working to revive Chrysler.
Automotive News reports that barely a month after new managers from 20 percent owner Fiat S.p.A. hit the ground at Chrysler's Auburn Hills, Mich., headquarters, Andreas Schell -- a fast-track engineer-manager who stayed on after former Chrysler partner Daimler AG exited in 2007 -- is leaving the company.
This after Schell was just named vehicle line executive for Chrysler's A- and B-class cars, the compact and subcompact models it either will borrow wholesale from Fiat or on which future Chrysler small cars will be based.
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Chrysler Completes Board of Directors
Chrysler Group LLC announced it has finished naming the last of its nine-member board of directors, with the new (and still private, despite billions of dollars in government loans) company's first board meeting scheduled for July 29.
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Led by Surging Ford, June Sales Ratcheted Reassuringly
By Dale Buss, Michelle Krebs and Bill Visnic
Automakers expressed more optimism about the U.S. car market despite the fact that overall sales in June fell by 28 percent compared with a year ago, to 859,420 vehicles. That represents only a slight improvement in year-ago comparisons over results for the first five months of this year.
Jesse Toprak, executive director of Industry Analysis for Edmunds.com, characterized the month cautiously. "It means, if nothing else, that things are not getting any worse, although things are not getting that much better, either. There was a lot of volatility, but there were signs of life."
Toprak added that June was "probably the best retail-demand month of the year."
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Posted by Michelle Krebs at 9:52 AM under Analysis , Chrysler , Companies , Featured , Ford , GM , News , Toyota | Comments (6) | digg this | del.icio.us
June Is Priciest Ever for Automaker Incentives, Edmunds.com Reports
SANTA MONICA, Calif. -- Automakers spent more in June on incentives than any June on record, Edmunds.com reports.
The average automaker incentive was $2,930 per vehicle sold in June up $489 -- or 20 percent, from a year ago, Edmunds.com estimates. Incentives were down a scant $22, or 0.8 percent, from May.
"June incentives have never been higher, but we anticipate that the tide is about to turn," said Jesse Toprak, Edmunds.com's executive director of Industry Analysis. "The effects of recent production cuts are starting to be felt, and as supply dwindles, incentives will fall."
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Posted by Michelle Krebs at 4:42 AM under Analysis , Chrysler , Featured , Ford , GM , Toyota | Comments (0) | digg this | del.icio.us
Chrysler Plant in St. Louis To Close
Chrysler confirmed it would move ahead the permanent closure of its St. Louis North
assembly plant to July 10.
Chrysler had planned to close the plant in the third quarter, but advanced the schedule due to declining demand for the Dodge Ram pickup trucks built there. The automaker will continue building the Ram at its Warren, Michigan, assembly plant.
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June Sales To Hit 10 Million SAAR; Detroit Share Improves, Edmunds.com Forecasts
SANTA MONICA, Calif. - June vehicle sales will hit their highest level of 2009 with a
Seasonally Adjusted Annualized Rate of 10.1 million when manufacturers report them Wednesday, Edmunds.com
forecasts.
"The SAAR is finally back in double-digits," observed Jesse Toprak, Edmunds.com's executive director of Industry Analysis. "We're still a long way from 16 million unit sales, but things are moving in the right direction.
General Motors and Chrysler, which both were in Chapter 11 bankruptcy during the month, are expected to post market share gains in June compared with May, proving yet-again -- contrary to conventional wisdom -- that consumers will, indeed, buy cars from a bankrupt manufacturer, at least in these current tumultuous times.
Honda and Hyundai also are forecasted to show May-to-June market share gains. The gains come at the expense of share declines for Ford, Nissan and Toyota. Despite Ford's dip, the share for Detroit automakers is estimated to come in at 47.0 percent in June, up from 46.6 percent in June 2008 and from 46.5 percent in May.
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Posted by Michelle Krebs at 6:45 AM under Analysis , Chrysler , Companies , Featured , Ford , GM , Toyota | Comments (0) | digg this | del.icio.us
GM, Chrysler Models Top List of Slowest Sellers, Edmunds.com Reports
Vehicles sold by General Motors and Chrysler, both of which filed for Chapter 11 bankruptcy
in recent months, dominated a list of the 15 slowest sellers in May, according to an analysis by Edmunds.com
, parent of AutoObserver.com
.
Of the 15 slowest-selling vehicles, 12 were made by American automakers. GM and Chrysler dominated the list. Ford had one vehicle on the list - the Mustang.
"It's really a reflection of a misstep of the American automakers," Edmunds.com analyst Jessica Caldwell.
Models from Korean brands, Kia and Hyundai, rounded out the list of 15 slow sellers.
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Vehicle Quality Improves Despite Bumpy Financial Ride
By Michelle Krebs
DETROIT -- The financial turbulence of the global auto industry has not hurt vehicle quality. Quite the opposite, according to new data released Monday by J.D. Power and Associates.
"Vehicle quality is better than it has ever been," Dave Sargent, J.D. Power's vice president of automotive research, told the Automotive Press Association here as he announced the results of the 2009 Initial Quality Study. The study measures defects reported by buyers in the first 90 days of ownership.
"There's a positive disconnect. There's no correlation between the financial side of the business and the production side," said Sargent. "Despite the turbulence on the business side and concern for the future of their own jobs, the people who design and build vehicles are getting on with their jobs and keeping their eye on the ball. That's remarkable."
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Posted by Michelle Krebs at 12:49 PM under Analysis , Chrysler , Companies , Featured , Ford , GM , News , Toyota | Comments (0) | digg this | del.icio.us
Chrysler Resumes Production at Seven Plants June 29
DETROIT -- Chrysler announced Wednesday it will resume vehicle production at seven of its
North American assembly plants starting the week of June 29.
Chrysler closed all of its plants when it filed for Chapter 11 bankruptcy. Since then, it has re-started only one plant; the Detroit Conner Avenue plant that makes the Dodge Viper cranked up production on Monday.
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Washington to Auto Suppliers: No More Money
WASHINGTON -- The U.S. Department of Treasury turned down a request by auto suppliers for additional financial aid, saying it believes the supply chain is stable enough without immediate assistance -- and besides it isn't the government's role to interfere in the contraction of the supplier market.
Two trade associations representing suppliers had asked for the government to guarantee between $8 billion to $10 billion in loans so banks will lend to the suppliers. That's in addition to the $5 billion the government provided to suppliers earlier this year. Those funds are administered through automakers.
President Obama's auto task force, however, did say it would step in if the supply chain unravels and vehicle assembly plants are forced to close due to parts shortages.
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Posted by Michelle Krebs at 9:23 AM under Business , Chrysler , Companies , GM | Comments (0) | digg this | del.icio.us
Americans Want Government Out of GM, Chrysler Quickly, Poll Says
Eight of 10 U.S. voters want the federal government to sell its stake in General Motors and Chrysler as soon as possible, according to a telephone survey done by Rasmussen Reports.
The federal government owns 60 percent of GM and 8 percent of Chrysler.
In fact, 64 percent of the 1,000 likely voters surveyed over last weekend said they favor a proposal that would force the government to sell their stake in the auto companies within a year. Only about 11 percent of the 1,000 likely voters surveyed over the weekend said they wanted the government to retain ownership.
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Posted by Michelle Krebs at 8:42 AM under Chrysler , Commentary , GM | Comments (0) | digg this | del.icio.us
Bill Ford Calls for National Industrial Policy, Gas Price Stabilization
DETROIT - Ford Motor Co. Chairman Bill Ford Jr., kicking off a National Summit in Detroit this week, called for the U.S. government to establish a national industrial policy aimed at bolstering the nation's competitiveness and to institute a policy that would stabilize "gyrating" gasoline prices.
"The industrial base is eroding and prosperous nations don't let their industries erode," Ford said. "Government, industry and academia all have to be on the same page. Too many times they throw bombs at each other rather than working together."
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Chrysler Plants To Resume Production; Viper Is First
DETROIT -- After shutting down all of its plants after filing for Chapter 11 bankruptcy April 30,
Chrysler is slowly resuming production, starting Monday with the Detroit Conner Avenue plant that makes the Dodge Viper sports car.
Chrysler should have a schedule for plant re-starts by the end of this week. Plants likely to resume production first will be those building vehicles for which demand is strong and inventories low.
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In Trucks, Bare-Knuckles Marketing Continues
By Dale Buss
In a throwback to a simpler era, the new Ford F-150's drop-down tailgate step has become an entertaining flashpoint in the marketing war between heavyweights in the pickup-truck segment.
In a current TV ad for the Silverado, Chevrolet's celebrity pitchster, Howie Long, tweaks the addition of the "man step" to the F-150 as an embarrassment -- because it only helps make up for the unreasonably long reach required to get over the tailgate to the bed of the F-150.
But Ford executives assert that Chevy's gambit actually highlights an appealing innovation for potential truck buyers -- and makes them more likely to choose an F-150.
"Our steps have done very well, because they're selling at about 30 percent of the mix of our F-150s," said Doug Scott, Ford's truck marketing manager. "So I hope GM keeps running the ad [in which] they're panning it."
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Posted by Michelle Krebs at 12:02 PM under Analysis , Chrysler , Featured , Ford , GM , Toyota | Comments (3) | digg this | del.icio.us
Chrysler, GM Losing and Moving Execs
By Bill Visnic
The Chrysler Group's bankruptcy is over, General Motors Corp.'s is accelerating like a Corvette and both companies are moving and losing significant personnel in sync.
None of this is unexpected, particularly as Chrysler is sure to be entertaining a certain amount of Fiat S.p.A executive injections now that Fiat is Chrysler's operational owner. And most insiders and industry analysts say GM still has plenty of management dead wood to burn and will see more voluntary separations, too.
GM still dealt a serious surprise when announcing Friday that purchasing chief Bo Andersson is leaving the company. Andersson was generally well-regarded in the supplier community, despite its usually tumultuous relationship with Detroit automakers for the past decade or more. Andersson had a reputation for being demanding and calculating but eminently fair in one of the toughest jobs in Detroit, if not the entire auto industry.
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Posted by Michelle Krebs at 3:48 PM under Chrysler , Featured , GM , News , Personalities , Rumors | Comments (2) | digg this | del.icio.us
Joke's on the Auto Sector - As Usual
The auto industry is an easy target for comics and this week's acquisition of the Chrysler Group by Fiat and the announcement of General Motors Corp.'s new chairman added new fuel to the comedic pyre.
Two of this week's best:
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Supreme Court Clears the Way for Chrysler-Fiat Alliance
WASHINGTON -- The Supreme Court cleared the way for the transfer of select Chrysler assets to Italy's Fiat.
The nation's highest court rejected a request from Indiana pension funds to delay the transfer until their objections were heard.
The court's ruling suggests the path will be cleared for General Motors, also in bankruptcy, to move fast on its sale of good assets to a new GM company, allowing it to emerge from bankruptcy quickly.
The Chrysler-Fiat alliance had been put temporarily on hold by Supreme Court Justice Ruth Bader Ginsburg Monday. But, as predicted by legal experts, that hold was lifted quickly as the court refused to hear the case brought by the pension funds.
Posted by Michelle Krebs at 6:27 PM under Chrysler , News | Comments (0) | digg this | del.icio.us
Judge Rules Chrysler Can Cancel Dealer Franchises
NEW YORK - U.S. Judge Arthur Gonzalez, who is overseeing the Chrysler bankruptcy proceedings, ruled Chrysler can, indeed, terminate the franchises of 789 dealers.
Gonzalez issued the order late Tuesday afternoon that the Chrysler, Dodge and Jeep dealerships designated by Chrysler to be terminated at midnight can no longer act as authorized dealers, effective immediately.
The ruling comes as now surprise as bankruptcy law superscedes state franchise laws. The rejected dealers had made a last-ditch effort to plead their case.
Posted by Michelle Krebs at 2:28 PM under Chrysler , News | Comments (2) | digg this | del.icio.us
Last Call: Tuesday Is End of the Road for Some Chrysler Dealers
At midnight Tuesday, Chrysler will have 789 fewer Chrysler, Jeep and Dodge dealers.
Actually, some already have closed for good after finding out Chrysler was canceling its franchises only weeks ago. Some plan to reopen Wednesday morning as used-car stores or centers providing some kind of automotive service.
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U.S. Supreme Court Puts the Brakes on Chrysler-Fiat Deal
WASHINGTON -- The U.S. Supreme Court has put on hold Chrysler's proposed deal to be
taken over by Italy's Fiat. The move pushes forward Chrysler's emergence from Chapter 11 bankruptcy and puts the Fiat deal, which expires June 15, at risk.
It also calls into question if General Motors, which followed Chrysler into bankruptcy, might face similar roadblocks.
Associate Justice Ruth Bader Ginsburg of the nation's highest court ruled Chrysler cannot yet transfer most of its assets to Fiat until more information is gathered and a hearing held on the subject.
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Posted by Michelle Krebs at 1:34 PM under Chrysler , Featured , News | Comments (0) | digg this | del.icio.us
Chrysler-Fiat Deal: Will It or Won't It? Only Supreme Court Knows for Sure
By Bill Visnic
Tension mounted over the weekend as investors in Chrysler LLC asked the U.S. Supreme
Court to consider their appeal of the sale of Chrysler's assets for Fiat S.p.A.
Given past history, it was unlikely the Supreme Court would further delay the decision of a New York appeals court that approved the sale. But the three objecting constituencies -- investment funds located in Indiana, including ones for state police and teachers -- submitted an emergency request that Supreme Court Justice Ruth Bader Ginsberg will consider, the Associated Press reported.
It was expected Justice Ginsberg would decide on the merits of the emergency appeal Monday.
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Posted by Michelle Krebs at 4:02 AM under Chrysler , Featured , News , Personalities | Comments (0) | digg this | del.icio.us
GM, Chrysler Defend Dealer Cuts in U.S. Senate
By Michelle Krebs
WASHINGTON -- General Motors CEO Fritz Henderson and Chrysler President Jim Press found themselves on the hot seat yet again in Congress Wednesday as they testified that it is essential to cut thousands of dealers in order to survive.
And once again, much as Detroit Three executives were at last fall's hearings for federal loans, the executives were grilled and skewered by members of Congress. Dealers being put out of business and dealer association executives chimed in as well.
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Posted by Michelle Krebs at 7:41 AM under Chrysler , Featured , GM , News , Personalities | Comments (2) | digg this | del.icio.us
Chrysler Asset Transfer to Fiat Put on Hold by Appeals Court
A federal appeals court has put on hold Chrysler's proposed transfer of assets to a new entity that will be controlled by Italy's Fiat.
U.S. Bankruptcy Judge Arthur Gonzalez in New York had said the sale could take place at noon Friday, moving up the date from June 15. However, an appeals court has agreed to hear the challenge to the sale by a group of Indiana pension funds. Written arguments are due by noon Thursday.
Nevertheless, experts predict Fiat's takeover of Chrysler will ultimately go through.
Posted by Michelle Krebs at 12:07 PM under Chrysler , Companies | Comments (0) | digg this | del.icio.us
Chrysler Exec Confident of Pending Factory Restarts
By Bill Visnic
With its once-ballooned inventories shrinking to more bearable levles - and projected to get uncomfortably low for at least a couple of models - Chrysler will restart at least some of the assembly plants in its currently-idled manufacturing system by the end of the month.
As an aside while speaking with reporters about Chrysler's May sales results, Steve Landry, Chrysler's executive vice president - North American sales, service and parts, said the company will soon decide which operations to restart, and of those facilities, "the majority of the plants will come up by the last week of June."
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Posted by Michelle Krebs at 5:20 AM under Chrysler , News | Comments (0) | digg this | del.icio.us
May Car Sales: Flirting with 10-Million SAAR
By Bill Visnic, Mary Connelly, Michelle Krebs
DETROIT - It's far too premature to break out the champagne and even too early to finally call the absolute bottom of one of the worst auto sales slumps in decades. But May sales reports from auto manufacturers in the U.S. hinted the worst just may be over.
"We saw glimmers of hope in May sales reports," said Jesse Toprak, executive director of Industry Analysis for Edmunds.com, parent of AutoObserver.com.
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Posted by Michelle Krebs at 10:58 AM under Analysis , Chrysler , Companies , Featured , Ford , GM , News , Toyota | Comments (1) | digg this | del.icio.us
Another Historic Event: Chrysler Begins Emerging From Bankruptcy
NEW YORK -- A judge in the same New York City bankruptcy court where General Motors
will file for Chapter 11 Monday has approved the sale of Chrysler assets to a group led by Italy's Fiat.
Judge Arthur Gonzalez approved the asset transfer saying, in his written opinion, it was the only alternative to "immediate liquidation" of Chrysler.
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Posted by Michelle Krebs at 4:09 AM under Chrysler , News | Comments (0) | digg this | del.icio.us
May Car Sales: Ever-So-Small Hint of Hope
SANTA MONICA, Calif. -- May car sales, due to be reported by auto manufacturer Tuesday, remain off by double-digits from last year, but the sales increase from April to May is in line with typical April-May seasonal bumps and the drop from a year ago is largely due to lower fleet sales, according to Edmunds.com's forecast.
For May, manufacturers are expected to report new vehicle sales -- retail and fleet -- of 890,000 units, a 36.1 percent decrease from the 1.4 million sold in May 2008 but an 8.9 percent increase from the 817,000 sold in April. A typical seasonal increase between April and May is a 9 percent rise. When adjusted for this difference in the number of selling days in May versus a year ago, sales decreased 33.6 percent.
That would put the Seasonally Adjusted Annualized Rate at about 9.5 million vehicles, up from 9.3 million in April.
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Posted by Michelle Krebs at 8:24 AM under Analysis , Chrysler , Companies , Featured , Ford , GM , Toyota | Comments (0) | digg this | del.icio.us
Chrysler Bankruptcy End Near; Trial Run for GM's
Chrysler is close to emerging from bankruptcy, well ahead of the 30 to 60 days the U.S.
government had promised when it entered April 30.
Chrysler was widely seen as the trial run for the even bigger and more complex Chapter 11 bankruptcy filing by General Motors, likely to come within days, if not hours.
A major step forward toward the end of Chrysler's bankruptcy comes Wednesday when federal bankruptcy Judge Arthur Gonzalez in New York considers a motion to sell most of Chrysler's assets to a new Chrysler under the control of Italy's Fiat.
The judge's expected approval would result in one of the biggest and fastest bankruptcy proceedings of its kind. Of course, Chrysler's bankruptcy -- as would be GM's -- would be unprecedented because of the intense involvement of the U.S. government, which has been criticized by business and some bankruptcy experts.
Posted by Michelle Krebs at 7:04 AM under Chrysler , GM , News | Comments (0) | digg this | del.icio.us
DaimlerChrysler Loses Appeal of $13.4 Million Case
The U.S. Supreme Court rejected an appeal from DaimlerChrysler AG to overturn a $13.4
million punitive damages verdict for a family whose child died in a 2001 car accident in Tennessee.
The family sued DaimlerChrysler, which at the time owned Chrysler, alleging the automaker installed a faulty seat design in their Dodge Caravan, leading to the death of their son when the minivan was rear-ended by another vehicle.
Posted by Michelle Krebs at 9:55 AM under Chrysler , News | Comments (0) | digg this | del.icio.us
Bankruptcy Judge May Bless Chrysler-Fiat Union This Week
NEW YORK -- The Chrysler-Fiat union could become official as early as Wednesday.
Judge Arthur Gonzalez of the Southern District of New York's bankruptcy court in Manhattan could rule on Wednesday morning to allow Chrysler to sell its select assets to a new company under control of Italy's Fiat. If that approval is granted, a deal to create a merged Chrysler-Fiat with the backing of the U.S. government could be closed by the middle of next month.
(Read more...)
Posted by Michelle Krebs at 6:57 AM under Business , Chrysler | Comments (0) | digg this | del.icio.us
Chrysler Midsize-Car Plant Restart Questionable
By Bill Visnic
Not yet a month into its Chapter 11 bankruptcy, news is starting to emerge about which pieces of Chrysler's manufacturing puzzle are likely to serve a purpose in the proposed new Chrysler-Fiat global alliance -- and which won't.
One that clearly has no future is Chrysler's Sterling Heights, Michigan plant, just outside of Detroit. The plant assembles the unloved and underachieving Chrysler Sebring and Dodge Avenger midsize sedans and two-door convertibles.
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Posted by Michelle Krebs at 12:39 PM under Chrysler , Companies , Featured , Rumors | Comments (2) | digg this | del.icio.us
Feds' New MPG Mandate May Collide With Buyer Preferences
By Bill Visnic
The Obama administration's "Kennedy moment" of announcing high-minded new Corporate Average Fuel Economy (CAFE) standards of 39 miles per gallon for passenger cars and 30 mpg for light trucks by 2016 drew kudos across the nation this week -- even from the automakers.
The new CAFE numbers sound great. But judging by the popularity of the vehicles on sale right now that comply with the ambitious new targets, car buyers might not stampede to get their hands on the future high-mileage wunderkars.
To be blunt, many of today's vehicles that can comply with the new CAFE numbers -- mostly compact or subcompact cars, hybrid-electric vehicles or four-cylinder crossovers or pickups -- are not exactly sales overachievers. For example, of the 100 most purchased vehicles in the U.S., only 17 could comply with the new fuel economy standards.
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Posted by Michelle Krebs at 12:01 PM under Analysis , Chrysler , Companies , Featured | Comments (16) | digg this | del.icio.us
Terminated Chrysler Dealers Offer Bargains, Earn Slim Profits, Edmunds.com Reports
SANTA MONICA, California -- Chrysler dealerships, whose franchise agreements have been terminated by the automaker effective June 9, are making significantly less profit on each vehicle sale, in large part, because they are offering the best deals to customers, Edmunds.com's analysis shows.
Profit margins for ill-fated Dodge dealerships are currently earning about $825 less per car, while closing Jeep dealerships are earning approximately $1,200 less per car.
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Posted by Michelle Krebs at 6:18 AM under Analysis , Chrysler | Comments (0) | digg this | del.icio.us
Chrysler Names C. Robert Kidder as New Chairman
By Michelle Krebs
DETROIT -- Chrysler announced the appointment of a new chairman. C. Robert Kidder, former chairman of Borden Chemical and Duracell International, who will lead the company after its completes its alliance with Fiat.
Kidder is currently chairman and CEO of 3Stone Advisors LLC, an investment firm that focuses on clean-tech companies, according to a statement issued by Chrysler.
He succeeds Robert L. Nardelli, who earlier announced he would return to private equity firm Cerberus Capital Management, Chrysler's current owner, when the automaker emerges from Chapter 11 bankruptcy proceedings and joins with Fiat.
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Posted by Michelle Krebs at 12:59 PM under Chrysler , Companies , Featured , Personalities | Comments (0) | digg this | del.icio.us
Commentary: Marchionne's Plan Is Gutsy but Iffy
By Richard Feast
LONDON -- Fiat CEO Sergio Marchionne scores top marks for ambition. His grand plan to sweep the whole of Chrysler plus General Motors' extensive European arm into Fiat's car operations is truly gutsy.
He may yet make the vision a reality. However, his chances of turning the partnership -- or whatever it might be called -- into a long-term success are minimal. The auto industry is littered with the memorials of empire builders who were long on vision and short on delivery.
And yet, despite the most severe economic collapse since the emergence of a globalized auto industry, Super Sergio wants to push through two deals simultaneously. Maybe he believes all those adoring media profiles.
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Posted by Michelle Krebs at 4:16 AM under Chrysler , Commentary , Companies , Featured | Comments (1) | digg this | del.icio.us
GM: Underperforming Dealers Won't Be Renewed
Some General Motors dealers, believed to be more than 1,000, are receiving letters from the
automaker Friday that tell them they are underperforming and their franchise agreements will not be renewed when they expire in October 2010.
GM will not release a list of those dealers, as Chrysler had to Thursday in its Chapter 11 bankruptcy filings.
Mark LaNeve, GM North America vice president of Vehicle Sales, Service and Marketing, will provide more details in a noon conference call with the media.
Posted by Michelle Krebs at 6:55 AM under Chrysler , Companies , GM | Comments (0) | digg this | del.icio.us
Chrysler Closing Nation's Oldest Jeep Dealer
By Bill Visnic
The names are many and varied on the list of 789 dealers with whom Chrysler announced yesterday it will seek to terminate franchise agreements in its bankruptcy proceedings and prospective restructuring.
Dealerships large and small across the nation are earmarked for closure, but one of the more historically significant is Corwin Jeep Sales and Service Inc. in Hickory, Pennsylvania. Corwin long has laid claim to being the nation's oldest Jeep dealer.
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Posted by Michelle Krebs at 4:10 AM under Chrysler , Companies , News | Comments (0) | digg this | del.icio.us
Chrysler Cuts 789 Dealer Agreements; GM Slashes Dealerships Friday
By Michelle Krebs
DETROIT -- Chrysler filed papers with the U.S. Bankruptcy Court in New York Thursday morning asking for permission to eliminate franchise agreements with 789 of its nearly 2,400 dealers.
U.S. Bankruptcy Judge Arthur Gonzalez must approve Chrysler's proposal and is likely to do so. Upon that ruling, the dealer rejections would take effect.
On Friday, General Motors is expected to notify 1,000 or more of its 6,200 dealers that their franchise agreements are being terminated as well even though GM has not filed for Chapter 11 reorganization as Chrysler has. However, GM is fully expected to file by June 1.
Both automakers have dealership networks, built over the years when the Big Three dominated the market, too large to support their lower sales volume and shrinking market share.
(Read more...)
Posted by Michelle Krebs at 8:05 AM under Chrysler , Companies , Featured | Comments (9) | digg this | del.icio.us
Fiat: We Just Want the Money, Not the Rules
By Bill Visnic
Let the "loopholing" begin.
Fiat S.p.A. made it clear it wouldn't go through with its no-investment alliance with now-bankrupt Chrysler unless the American automaker was guaranteed to be the recipient of $6 billion (and probably more) in federal loan guarantees.
Now that Fiat is all but assured of favored-bidder status in the Chapter 11 bankruptcy auctioning of Chrysler's assets and the subsequent Fiat-Chrysler alliance is on track -- as are the federal billions earmarked for the "new" Chrysler -- Fiat's revealed some intriguing new financial sleight-of-hand: an end-run around executive-compensation limits imposed on companies that accept government handouts.
(Read more...)
Posted by Bill Visnic at 8:24 PM under Business , Chrysler , Companies , News | Comments (3) | digg this | del.icio.us
Chrysler Dissident Investors Cave; Political, Legal Wounds Linger
By Bill Visnic
Industry analysts. Political commentators. Legal scholars (and those who think they are). Journalists.
Everyone's got an opinion -- plenty of it critical -- about how the Chrysler Chapter 11 bankruptcy has gone down and is proceeding. And about whether Fiat's resulting takeover of Chrysler can really work.
Most criticism of "the deal" focuses on whether the government, acting as the agent of compromise and haste, outstepped legal and ethical boundaries in abrogating the property rights of Chrysler's secured creditors and later "strong arming" those creditors who rejected a government offer of about one-third the value of their holdings.
Whether the bullying was real or perceived no longer matters. The remaining secured-lender holdouts, their numbers dwindling by the day, announced late last week they are withdrawing their objection of the bankruptcy procedure laid out to allow the sale of Chrysler's assets to a new, reconfigured Chrysler run by Fiat.
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Posted by Michelle Krebs at 6:12 AM under Chrysler , Commentary , Featured | Comments (0) | digg this | del.icio.us
GMAC May Be Next for Taxpayer Ownership
By Bill Visnic
As if the auto industry needs more to worry about, this week's "stress test" for banks' compliance with new government liquidity regulations puts auto-sector mega-lender GMAC Financial Services in a difficult light.
The Wall Street Journal reports that GMAC needs $11.5 billion in capital and "makes outright government control of the auto-finance company look increasingly likely," as it is presumed few private investors would step up to take that kind of position in GMAC, which also will assume the in-house financing role for Chrysler vehicles sometime near the middle of this month.
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Posted by Michelle Krebs at 5:46 AM under Chrysler , Companies , GM | Comments (0) | digg this | del.icio.us
Not So Fast, Fiat: Russians Interested in Opel, Too
Fiat CEO Sergio Marchionne's plan to create a mega-automaker by
combining Fiat's auto operations with Chrysler and General Motors Corp.'s Opel and other European operations may yet face competition from a previously named interested party: Canada's Magna International.
Just-auto.com reported a Russian news source as saying Magna is allying with Russia's Sberbank and GAZ Group to make a controlling-stake bid for Opel, which GM is anxious to offload and Marchionne covets in order to create a new automaker from Fiat, Opel and Chrysler.
(Read more...)
Posted by Michelle Krebs at 3:56 AM under Business , Chrysler , Companies , GM | Comments (1) | digg this | del.icio.us
Chrysler's Politicized Bankruptcy a Warm-Up for GM
By Bill Visnic
Watching and analyzing as the increasingly contentious Chrysler bankruptcy unfolds, a Detroit-area legal expert on bankruptcy and creditors' rights reckons the charged atmosphere surrounding Chrysler's trip to bankruptcy court is a warm-up act for the headline show: the bankruptcy of much-larger General Motors Corp.
Although the Chrysler bankruptcy already has generated something only slightly less than a full-blown political firestorm and is proceeding with questionable ethical and legal departures from established bankruptcy conventions, "We may well face it again in a month," as GM's bankruptcy deadline nears, said Doug Bernstein, a partner in the Bloomfield Hills, Michigan, legal firm Plunkett Clooney and head of the firm's Banking, Bankruptcy and Creditors' Rights practice group.
(Read more...)
Posted by Michelle Krebs at 3:49 AM under Chrysler , Commentary , Featured | Comments (0) | digg this | del.icio.us
The Obama Bounce? Chrysler Purchase Intent Up, Edmunds.com Says
SANTA MONICA, Calif. -- Despite General Motors and Chrysler executives insisting for months that the spigot for sales and shoppers would shut off with a bankruptcy filing, quite the opposite has occurred with Chrysler of late, according to data collected by Edmunds.com
, parent of AutoObserver.com
.
On Thursday, Chrysler filed for Chapter 11 reorganization in bankruptcy court. Since then, the visitors on Edmunds.com's Web site who are shopping for Chrysler models shot up 15 percent. By comparison, GM's shopping consideration dropped 6 percent since Thursday and Ford's was up 7 percent.
"Maybe It's the Obama bounce," suggests Edmunds.com CEO Jeremy Anwyl.
(Read more...)
Posted by Michelle Krebs at 11:50 AM under Analysis , Chrysler | Comments (0) | digg this | del.icio.us
Chrysler's Challenge: Finding Customers During Bankruptcy
By Michelle Krebs
DETROIT -- Chrysler has launched a major advertising campaign, to be coupled with a cash and dealer incentives, in its effort to convince new buyers to purchase Chrysler, Dodge and Jeep vehicles and keep current owners in the fold.
But even before it officially filed for Chapter 11 bankruptcy last Thursday, Chrysler was struggling to maintain its once-loyal buyers. In the months leading up to Chrysler's bankruptcy filing -- and despite some of the highest incentives ever in the U.S. auto industry doled out by Chrysler -- the automaker's customer loyalty has dropped on the news of its financial duress. Customer loyalty fell below 50 percent in April, according to Edmunds.com's data. That is, less than half of Chrysler owners who traded in their vehicle did so for another Chrysler, Dodge or Jeep vehicle.
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Posted by Michelle Krebs at 9:43 AM under Analysis , Business , Chrysler , Featured | Comments (0) | digg this | del.icio.us
Chrysler: A Whirlwind of Bankruptcy Court Activity
By Michelle Krebs
Who knows if Chrysler really can emerge from Chapter 11 bankruptcy in the 30 to 60 days it hopes for, but the activity around the court proceedings have ratcheted up to warp speed.
On Friday, a day after Chrysler officially filed for Chapter 11 reorganization, photographers, like paparazzi snapping celebrities, shot pictures of lawyers and their assistants carrying document-loaded boxes through Manhattan streets to New York's Southern District court.
There, Judge Arthur Gonzalez, who oversaw the giant Enron and WorldCom bankruptcies, apparently cleared his docket for Chrysler's bankruptcy, the nation's fifth-largest ever bankruptcy.
(Read more...)
Posted by Michelle Krebs at 8:25 AM under Chrysler , News | Comments (0) | digg this | del.icio.us
With Chrysler Captured, Fiat Moving on Opel
By Bill Visnic
With Chrysler LLC now in bankruptcy and its assets all but promised to Fiat S.p.A. as part of a months-in-the-making ownership and alliance proposal, Fiat's hyper-acquisitive chief executive Sergio Marchionne already is laying out a plan to take over General Motors Corp.'s foundering European operations.
And yes, Marchionne's already throwing around the "S" words: synergies and savings.
(Read more...)
Posted by Michelle Krebs at 4:12 AM under Chrysler , Companies , Featured , GM , Personalities | Comments (1) | digg this | del.icio.us
April Car Sales: The Bottom's Around Here Somewhere
By Dale Buss, Michelle Krebs and Bill Visnic
April's auto sales numbers looked pretty much like those from March, and February, and January - abysmal. Industrywide sales plunged by 34 percent last month compared with a year earlier, continuing the first-quarter trend of dreadful comparisons tied to a moribund economy.
But in those April results, carmaker executives and analysts on Friday also thought they saw more than just the latest in a long string of awful comparisons with 2008. Almost to a person, they interpreted April's performance and other economic data as painting at least a near bottom of the dreadful U.S. car market - and as the harbinger of an eventual recovery.
"We won't truly be able to call the bottom until summer when we can look back at three consecutive months of increase in the annualized rate of sales," said Jesse Toprak, executive director of industry analysis for Edmunds.com. "We had expected April would be the start of that. And April's annualized sales rate, while lower than March, still didn't dip to February level."
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Posted by Michelle Krebs at 8:49 AM under Analysis , Chrysler , Companies , Featured , Ford , GM , Toyota | Comments (2) | digg this | del.icio.us
Chrysler Bankruptcy: It's Official as Case No. 09-50002
By Michelle Krebs
It's official: Chrysler has now filed for bankruptcy. Case No. 09-50002.
The bankruptcy pleadings were officially filed Thursday afternoon, shortly after President Obama announced Chrysler was going into bankruptcy despite its signed alliance with Italy's Fiat.
(Read more...)
Posted by Michelle Krebs at 1:44 PM under Business , Chrysler | Comments (0) | digg this | del.icio.us
Chrysler's LaSorda Will Retire; Nardelli Returns to Cerberus
By Michelle Krebs
AUBURN HILLS, Mich. -- Former Chrysler CEO Tom LaSorda, most recently vice chairman and president, said Thursday in a conference call that he will retire. He gave no effective date for his retirement but said he will not stick around through Chrysler's Chapter 11 bankruptcy.
Current Chrysler CEO Robert Nardelli said he, too, would be leaving Chrysler after it emerges from bankruptcy to return as an advisor to private equity firm Cerberus Capital Management, which owned Chrysler before Thursday's deal with Italy's Fiat was announced.
Chrysler President and Vice Chairman Jim Press said he has had no discussions regarding his employment status.
(Read more...)
Posted by Michelle Krebs at 11:18 AM under Chrysler , News , Personalities | Comments (0) | digg this | del.icio.us
Chrysler Plants Shut Down Until Bankruptcy Over; CEO Nardelli Out
By Bill Visnic
Less than an hour after confirming it filed a petition for Chapter 11 bankruptcy, Chrysler LLC issued a press release with initial details of its proposed alliance with Italy's Fiat S.p.A.
Most intriguing is a statement (near the bottom of the release) saying most Chrysler manufacturing operations will shut down starting Monday -- and, although the language is vague, presumably not restart until the restructured company emerges from bankruptcy.
Also, Chief Executive Office Robert Nardelli will leave the company "following the emergence of the new [Chrysler] company from Chapter 11 and the completion of the alliance with Fiat."
(Read more...)
Posted by Bill Visnic at 11:05 AM under Business , Chrysler , Companies , In the Media , News | Comments (0) | digg this | del.icio.us
Chrysler Files for Bankruptcy and Combines With Fiat
By Michelle Krebs
DETROIT -- President Obama announced Thursday that Chrysler will combine with Italy's Fiat but is filing for Chapter 11 reorganization to get the job done.
In a White House press conference Thursday, President Obama chastised the banks and hedge funds that refused a government-sweetened deal to reduce Chrysler's debt owed to them.
Obama called them "speculators" who refused to make sacrifices when the workers, plant communities, major lenders and dealers did. As a result of debtholders holding out, the president said, Chrysler is filing for bankruptcy to "clear away remaining obligations so the company can get back on its feet onto a path of success."
(Read more...)
Posted by Michelle Krebs at 8:47 AM under Chrysler , Companies , Featured , News | Comments (1) | digg this | del.icio.us
President Obama Set To Discuss Chrysler; Bankruptcy Path to Fiat Deal
By Michelle Krebs
DETROIT -- Chrysler will live to see another day as part of the growing empire of Italy's Fiat, but a Chapter 11 bankruptcy filing is the path that Chrysler and Fiat will take to get there.
President Obama will hold a briefing on Chrysler at noon Thursday. Word is that he will announce Chrysler will file bankruptcy, likely in New York. The hope is for a quick in and out of bankruptcy, with Chrysler emerging as a more viable company with only the good assets under Fiat ownership.
On Wednesday night, negotiations with Chrysler's lenders over reducing the automaker's debt collapsed. At the same time, members of the United Auto Workers (UAW) union overwhelmingly approved a concessionary contract.
Beyond dealing with debtholders, bankruptcy likely is seen as a quick and cheaper way to halve Chrysler's dealer ranks of 3,200.
(Read more...)
Posted by Michelle Krebs at 5:28 AM under Chrysler , Companies , Featured | Comments (0) | digg this | del.icio.us
Chrysler To Be Taken Over By Fiat; Bankruptcy Not Ruled Out
By Michelle Krebs
DETROIT -- The precise sequence of events appears murky at the moment, but two things appear to be happening with Chrysler on the eve of the government-imposed deadline: Italy's Fiat will take over Chrysler, and Chrysler is preparing Chapter 11 reorganization papers, that may or may not be filed in bankruptcy court.
Either way, President Obama reportedly will make an announcement on Thursday on the future of Chrysler.
However, so far, no one is confirming anything -- not Fiat, not Chrysler and not the Obama administration.
A couple of scenarios are emerging on how the Chrysler-Fiat alliance will come together, a couple of them involving bankruptcy, another keeping it out of bankruptcy court..
What's clear is heavy negotiating continues as the clock until the midnight deadline Thursday ticks down.
(Read more...)
Posted by Michelle Krebs at 1:46 PM under Chrysler , Companies , Featured , Rumors | Comments (0) | digg this | del.icio.us
Chrysler Deadline Looms; Progress Made, Nardelli Says
Thursday marks the deadline the U.S. government has set for Chrysler to get its ducks in
order and make a final deal with Italy's Fiat. And Chrysler CEO Robert Nardelli, told employees in a letter Wednesday that progress is being made.
"I'm encouraged by this progress and I want you to know I deeply appreciate the sacrifices made by so many constituents to help us reach the restructuring targets established by the government," Nardelli wrote.
At a town meeting in Missouri, President Obama said: "We don't know yet whether the deal is going to get done," according to the French news agency, AFP.
Meantime, Chrysler hourly employees represented by the United Auto Workers union were voting Wednesday on a contract that would give them 55 percent of Chrysler's stock in exchange for a pay freeze, work rule changes and other modifications to the current contract negotiated in 2007. Workers were expected to approve the new deal.
(Read more...)
Posted by Michelle Krebs at 9:40 AM under Chrysler , Featured | Comments (0) | digg this | del.icio.us
Chrysler Clears More Hurdles but to What End?
By Michelle Krebs
DETROIT -- Chrysler has cleared another hurdle for getting a deal done with Italy's Fiat with the U.S. Treasury Department's announcement that an agreement had been reached with Chrysler's main creditors and Daimler AG had cut loose its stake in the automaker.
However, the creditors' agreement along with the necessary union contracts, also settled in recent days, does not mean Chrysler will avoid Chapter 11 bankruptcy.
(Read more...)
Posted by Michelle Krebs at 10:15 AM under Chrysler , Featured , News | Comments (0) | digg this | del.icio.us
UAW Reaches Deal With Chrysler; CAW Ratifies Contract
DETROIT -- The United Auto Workers (UAW) said Sunday night that the union had reached an agreement with Chrysler, Italy's Fiat and the U.S. government on concessions to its 2007 contract and health care trust, Reuters reported.
Also on Sunday night, members of the Canadian Auto Workers union ratified a concessionary contract they reached with Chrysler over the weekend.
(Read more...)
Posted by Michelle Krebs at 6:11 PM under Chrysler , News | Comments (0) | digg this | del.icio.us
April Auto Sales: SAAR Rises to 10 Million, Edmunds.com Forecasts
SANTA MONICA, Calif. -- April vehicle sales are looking like they will come in at a Seasonally Adjusted Annualized Rate of 10 million. That's certainly nothing to brag about in normal times and compared with the last decade. Still, April looks to be the best month in several and up from 9.1 million in February.
"The industry is slowly picking up much-needed momentum; a 'cash for clunkers program' could help while an automaker bankruptcy could hurt, depending on how consumer confidence is affected," said Jesse Toprak, executive director of Industry Analysis for Edmunds.com.
(Read more...)
Posted by Michelle Krebs at 5:48 PM under Analysis , Chrysler , Companies , Ford , GM | Comments (0) | digg this | del.icio.us
Eleventh-Hour Compromises From Chrysler Stakeholders, but Is Fiat Still Serious?
By Bill Visnic
With President Obama's economic advisor saying only that the administration is "hopeful" Chrysler LLC can wrap up a deal with Italy's Fiat S.p.A. by the end of the week in order to stave off a trip to bankruptcy court, key constituencies made gestures over the weekend a willingness to help keep alive the Chrysler-Fiat deal.
That is if Fiat even wants to.
(Read more...)
Posted by Michelle Krebs at 4:39 PM under Chrysler , Featured , GM | Comments (0) | digg this | del.icio.us
U.S. Preparing A Chrysler Chapter 11, The New York Times Says
DETROIT -- The U.S. Treasury Department is preparing a Chapter 11 bankruptcy filing for
Chrysler that could come as soon as next week, The New York Times
is reporting.
The paper, quoting unnamed sources, says the Treasury has an agreement in principle with the United Automobile Workers union, whose members' pensions and retiree health care benefits would be protected as a condition of the bankruptcy filing.
The Times further says Italy's Fiat would complete its alliance with Chrysler while the company is under bankruptcy protection.
(Read more...)
Posted by Michelle Krebs at 1:42 PM under Chrysler , GM , News | Comments (2) | digg this | del.icio.us
Peapod NEV Opens for Orders Beginning Today - Earth Day
By Dale Buss
At least for today, Chrysler will be able to hold its new keepers in the Obama administration at bay. Because on Earth Day in New York City, Chrysler's Peapod unit has begun taking orders for the company's new Peapod Neighborhood Electric Vehicle
.
There's nothing more "green" -- especially for a company that has notably lacked in environmental orientation -- than an all-electric vehicle that operates at low speeds with no emissions. Peapod is designed to jump-start interest in an NEV segment that always has been the dowdy province of true Earth Firsters; residents of planned communities such as Celebration, Florida; and older folks who live around golf courses.
(Read more...)
Posted by Michelle Krebs at 6:30 AM under Chrysler , In the Media , News , Personalities | Comments (0) | digg this | del.icio.us
Obama Administration Loans Chrysler, GM More Money
The Obama administration, as promised, is providing more funds for Chrysler and General
Motors as working capital to keep them afloat as they try to meet the government-imposed deadlines.
Chrysler received about $500 million to get it through the end of April. The Obama administration has set an April 30 deadline for Chrysler to negotiate a final deal with Italy's Fiat in order to be granted $6 billion more in government funds or face bankruptcy. And the government will end its support of Chrysler if it goes into
bankruptcy.
GM is receiving $5 billion through May to help it meet its June 1 deadline to return to the Obama administration with a viable restructuring plan or it faces bankruptcy, during which the government will provide funding.
(Read more...)
Posted by Michelle Krebs at 7:16 AM under Chrysler , Companies , Featured , GM , News , Personalities | Comments (0) | digg this | del.icio.us
Bankruptcy Expert: GM "Quick Rinse" Bankruptcy Risks "Rinse And Repeat"
DETROIT -- Reports have heated up of late that General Motors will file for Chapter 11
bankruptcy in late spring or early summer, emerging as a smaller but viable company in as little as two weeks or two to four months at most in a so-called "quick rinse" bankruptcy.
Both of these scenarios are exceedingly optimistic, say bankruptcy experts at the Detroit-based law firm of Plunkett Cooney. And done too quickly, a GM bankruptcy may become a 'rinse and repeat' bankruptcy," said Doug Bernstein, head of Plunkett Cooney's Banking, Bankruptcy and Creditors' Rights practice group.
(Read more...)
Posted by Michelle Krebs at 5:50 AM under Analysis , Chrysler , Companies , GM | Comments (0) | digg this | del.icio.us
Chrysler-Fiat: "Value" for Fiat Means "Free"
By Bill Visnic
With a May 1 deadline to make a deal with stakeholders -- a prerequisite of subsequently partnering with Fiat S.p.A. -- bearing down on Chrysler LLC lest the Obama administration's Auto Task Force take Chrysler into some form of bankruptcy, the posturing is heating up, particularly from Fiat Chief Executive Office Sergio Marchionne.
First, Marchionne threatened Fiat will deep-six its offer to tie up with Chrysler if the company cannot wrest further wage concessions from its U.S. and Canadian labor unions, concessions presumably to bring wages to parity with non-unionized Japanese transplant automakers in the U.S.
The unsubtle warning failed to immediately produce the desired result from either the United Auto Workers or the Canadian auto workers unions.
(Read more...)
Posted by Michelle Krebs at 4:18 AM under Analysis , Chrysler , Commentary , Featured | Comments (0) | digg this | del.icio.us
Take My Pickup - Please
By Bill Visnic
Headlines declared the auto industry achieved a showroom mini-victory in March by markedly improving sales over a dismal February. But the improved numbers were something like lipstick on a pig as March's boost nonetheless concealed some ugly realities.
One of the most foreboding trends to continue despite the March uptick: the still-accelerating plunge of the full-size pickup truck market. If segment sales do not stabilize this year, revenue-ravaged automakers may have to take drastic measures.
(Read more...)
Posted by Michelle Krebs at 10:42 AM under Analysis , Chrysler , Featured , Ford , GM | Comments (2) | digg this | del.icio.us
Chevrolet Camaro Wins Edmunds' Inside Line Muscle Car Comparison Test
SANTA MONICA, Calif. -- Inside Line, Edmunds.com's online car magazine and sister site
of AutoObserver.com
, announced Wednesday that the 2010 Chevrolet Camaro SS took first place in its latest comparison test of iconic muscle cars.
The comparison is described in full at the 2010 Chevy Camaro SS vs. 2009 Dodge Challenger R/T vs. 2010 Ford Mustang GT Comparison Test.
"Car enthusiasts can rejoice that all three of these legendary pony cars have made a comeback," says Jay Kavanagh, Edmunds' Inside Line Engineering Editor. "But the 2010 Chevrolet Camaro SS leads the pack with its combination of power, speed and attitude."
(Read more...)
Posted by Michelle Krebs at 9:59 AM under Analysis , Chrysler , Commentary , Companies , Ford , GM | Comments (0) | digg this | del.icio.us
Fiat's Marchionne: Union Concessions or We Walk Away
By Michelle Krebs
TORONTO -- Fiat CEO Sergio Marchionne told a Toronto newspaper that a Fiat-Chrysler
partnership had only a 50-50 chance of success because of lack of progress in talks with union leaders, especially those in Canada. He said that the Italian automaker is prepared to walk away from the proposed alliance with Chrysler, which must be completed in two weeks, if the union doesn't cut costs. That likely would leave Chrysler headed to bankruptcy court.
"Absolutely we are prepared to walk. There is no doubt in my mind," Marchionne said in an interview with Toronto's Globe and Mail newspaper. Instead, he said, Fiat would find another international partner.
Nomura analyst Michael Tyndall told Reuters Marchionne was probably not bluffing in talking tough with the unions. "He's playing hardball," he told the newswire, adding that the unions' position would make the deal too costly for Fiat. "We want them [Fiat] to walk away...I don't see any benefits in this deal."
(Read more...)
Posted by Michelle Krebs at 5:17 AM under Chrysler , Companies , News , Personalities | Comments (2) | digg this | del.icio.us
Fiat CEO Marchionne Could Be Chrysler CEO as Well, Trade Journal Says
Fiat CEO Sergio Marchionne could add Chrysler CEO to his list of titles under one scenario
being discussed by the two companies regarding an alliance, a trade journal reported.
The future Chrysler board also may include members of President Obama's automotive task force, Automotive News says in Monday's edition.
The publication says the companies are discussing a revised ownership structure, a new board and possibly a different management team for Chrysler. Under consideration is splitting Chrysler chairman and Chrysler CEO into two jobs. Robert Nardelli currently holds both titles. Marchionne could gain the CEO title, giving him a direct role in Chrysler's operations. The chairman role would be held by an American, Automotive News said.
(Read more...)
Posted by Michelle Krebs at 10:42 AM under Chrysler , Companies , Personalities , Rumors | Comments (0) | digg this | del.icio.us
GM Told To Prepare for Quick Bankruptcy, Paper Reports
NEW YORK -- Yet another newspaper report claims General Motors is preparing to file for
bankruptcy at the urging of the Obama administration.
This time, it is The New York Times reporting in Sunday's edition that the U.S. Treasury Department is directing the automaker to lay the groundwork for a bankruptcy filing by June 1.
Citing unnamed sources supposedly briefed on the GM's plans, the Times reports the goal is to prepare for a fast "surgical" bankruptcy if the automaker can't reach agreement with bondholders and the United Automobile Workers union for a debt-for-equity swap.
(Read more...)
Posted by Michelle Krebs at 9:23 AM under Analysis , Chrysler , Companies , GM , In the Media | Comments (0) | digg this | del.icio.us
GM, Chrysler Bankruptcies Have Beneficiaries, Report Says
LONDON -- It's not all doom and gloom if General Motors and Chrysler go bankrupt, a new report says. In fact, some automakers will benefit from their bankruptcy.
GM and Chrysler competitors could gain pre-tax profit of more than $24 billion if the companies are forced to dramatically downsize after some kind of bankruptcy, says a report from Bernstein Research in London and reported on by the Detroit News.
In the U.S., Ford would benefit most with GM and Chrysler customers deflecting to its brand. Ford would be followed by the Japanese automakers and Germany's Volkswagen.
(Read more...)
Posted by Michelle Krebs at 9:19 AM under Analysis , Chrysler , Companies , Ford , GM | Comments (1) | digg this | del.icio.us
U.S. Government Orders 17,600 Big Three Vehicles
WASHINGTON -- As President Obama promised a week ago, his administration is advancing plans for the purchase of new government fleet cars to spur U.S. vehicle sales and improve the fuel-efficiency of government-owned cars.
The government's order is for 17,600 fuel-efficient vehicles from General Motors, Ford and Chrysler by June 1. The total tab comes to $285 million, which will be drawn from the $787 billion economic stimulus package.
(Read more...)
Posted by Michelle Krebs at 7:50 PM under Chrysler , Companies , Ford , GM | Comments (0) | digg this | del.icio.us
Economy Takes a Toll on Auto Dealers Ranks
In the first quarter this year, 271 auto dealers in the U.S. went out of business, according to
the National Automobile Dealers Association.
NADA reports at the end of the first quarter, the U.S. had 19,738 auto dealers, down from 20,009 year-end 2008.
The trade group predicts about 1,200 dealers, mostly representing General Motors, Chrysler and Ford brands, to go out of business this year, about 20 percent more than last year.
(Read more...)
Posted by Michelle Krebs at 7:25 PM under Chrysler , Companies , Ford , GM , News | Comments (3) | digg this | del.icio.us
Auto Suppliers Get $5 Billion
The U.S. Treasury Department will start releasing $5 billion in government funds to auto suppliers next week. The Supplier Support Program will funnel the money through General Motors and Chrysler, which have loans from the government, to their shakiest and most vital suppliers.
Chrysler plans to use $1.5 billion; GM expects to use $2 billion. The remaining $1.5 billion would be available at the request of GM or Chrysler.
Ford has declined to participate as it has with government loans for itself. Instead, Ford is lending money to its suppliers.
Posted by Michelle Krebs at 10:13 AM under Chrysler , Companies , Ford , GM , News | Comments (0) | digg this | del.icio.us
Customers Prefer No-Bailout Ford, Edmunds.com Reports
SANTA MONICA, Calif. -- Ford's choice and ability to avoid taking loans from U.S.
government is paying dividends in increased shopping by consumers.
An analysis of shopping on its Web site by Edmunds.com, parent of AutoObserver.com, shows the number of visitors who shopped for Ford vehicles in the first three months of this year rose 12 percent compared with the same period a year ago.
At the same time, the number of shoppers considering vehicles from General Motors and Chrysler, both of which have taken loans from the U.S. government, declined 19 percent and 15 percent respectively during the same period.
Posted by Michelle Krebs at 8:39 AM under Analysis , Chrysler , Companies , Ford , GM | Comments (0) | digg this | del.icio.us
Fiat's Marchionne Back In the USA; Hurdles In Chrysler Deal Remain
Fiat CEO Sergio Marchionne reportedly is back in the U.S. to continue hammering out an
alliance with Chrysler.
Marchionne and Alfredo Altavilla, Fiat's head of business development and chief executive of its powertrains division, reportedly are dividing their time between negotiations in Detroit with Chrysler and the UAW and meetings in Washington with U.S. Treasury officials.
President Obama has given Chrysler until the end of this month to
finalize a definitive agreement with Fiat. And that's "ample time," said Chrysler President Jim Press Wednesday at the New York auto show, where he was driven onto the stage in a Fiat 500.
(Read more...)
Posted by Michelle Krebs at 7:34 AM under Chrysler , News , Personalities | Comments (0) | digg this | del.icio.us
New York Auto Show: Chrysler's Press Plays Up Fiat Alliance Benefits
By Michelle Krebs
With the tiny Fiat 500 as his prop, Chrysler President Jim Press used the stage of the New York auto show to play up the benefits of a proposed alliance with Italy's Fiat.
"Imagine the possibilities this marriage could have," said Press. "This car is roughly the same size as [Chrysler's] Hemi engine," Press quipped of the 500. "It's the perfect car to get around New York City."
(Read more...)
Posted by Michelle Krebs at 7:26 AM under Chrysler , Companies , Technology | Comments (0) | digg this | del.icio.us
Chrysler Selects A123Systems as Battery Supplier
By Bill Visnic
With barely three weeks to concoct a workable alliance with Fiat S.p.A lest the Feds roll out the bankruptcy carpet, Chrysler LLC had enough extra time on its hands this week to announce its latest team-up: a strategic alliance with Massachusetts-based battery developer A123Systems.
Chrysler said in a press release that the deal "reinforces both companies'" commitment to expand battery manufacturing technology in the United States, reducing dependency on foreign sources of energy and greenhouse gas emissions."
(Read more...)
Posted by Michelle Krebs at 5:52 AM under Chrysler , Companies , Featured , News , Technology | Comments (0) | digg this | del.icio.us
President Obama: Auto Industry Cannot Vanish
President Obama sent a message this weekend to auto workers and residents of
auto towns that the U.S. "cannot let our auto industry vanish."
President Obama, in a column under his byline that appeared in select Midwest newspapers, said the reason the U.S. government is supporting General Motors and Chrysler with loans is because the auto industry "is an emblem of America" that helped build and sustain the middle class."
Obama acknowledged auto workers and auto towns had been through much pain and indicated they needed to brace for even more.
(Read more...)
Posted by Michelle Krebs at 6:15 AM under Chrysler , Commentary , Companies , GM , In the Media , Personalities | Comments (0) | digg this | del.icio.us
GM's Henderson: File Bankruptcy Only if Required
By Michelle Krebs
Less than a week after becoming the new CEO of General Motors, replacing ousted Rick Wagoner
, Fritz Henderson
appeared on two major news shows Sunday -- CNN's State of the Union
and NBC's Meet the Press.
In both interviews, Henderson insisted the automaker still prefers to avoid bankruptcy court to accomplish its restructuring, "but if it's required, that's what we'll do."
Henderson reiterated on Meet the Press what he'd told the media in his first press conference last Tuesday that GM needs to "go deeper and we need to go faster" in its restructuring. "We either accomplish this job outside of bankruptcy in the short term, or alternatively, if it's necessary, we'll go into bankruptcy in order to get this job done," he said."
(Read more...)
Posted by Michelle Krebs at 5:10 AM under Chrysler , Companies , Featured , GM , In the Media , News , Personalities | Comments (0) | digg this | del.icio.us
Chrysler's Italian Lifeline Full of Knots
By Bill Visnic
With fewer than 30 days now to cement a partnership with Italy's Fiat S.p.A. or else, Chrysler LLC's prospects for survival -- at least in something resembling its current form -- are slimmer than the lapels on Fiat President Luca Cordero di Montezemolo's suit.
Thirty days to structure a complex, transcontinental and cross-cultural manufacturing and product-development alliance when both companies are in financial distress, auto markets on their home continents are dangerously depressed -- and their respective top management as recently as last week wasn't even on the same
page regarding the most basic elements of the deal?
Auto-industry alliances often do not turn out well -- and can be assumed not to begin any better when devised under the condition that one party has a date in bankruptcy court if the plan doesn't happen.
(Read more...)
Posted by Michelle Krebs at 7:56 AM under Analysis , Chrysler , Featured | Comments (0) | digg this | del.icio.us
March Car Sales Show Signs of Life
By Michelle Krebs and Bill Visnic
A late-month uptick caused March car and truck sales to surpass forecasters' expectations, providing a glimmer of hope to the U.S. auto industry that the long and ugly drought is nearing an end.
"We started to see some signs of life in the March numbers," said Jesse Toprak, executive director of Industry Analysis for Edmunds.com, parent of AutoObserver.com. His remark echoed similar comments made by auto company executives and analysts as they delivered their March sales results Wednesday.
Particularly encouraging to everyone was the rise in the annualized rate and the above-average hike in sales from February to March.
(Read more...)
Posted by Michelle Krebs at 9:22 AM under Analysis , Chrysler , Companies , Featured , Ford , GM , Toyota | Comments (0) | digg this | del.icio.us
Incentives Set All-Time Record, Edmunds.com Reports
By Michelle Krebs
SANTA MONICA, Calif. -- Automaker incentives set a new all-time high in March, even though it appears they didn't help sales much, according to Edmunds.com
.
The average automotive manufacturer incentive was $3,169 per vehicle sold in March, the highest industry average on record.
"Automakers are pulling every lever in their effort to attract buyers, as evidenced by the new programs from Ford and General Motors," stated Jesse Toprak, Edmunds' executive director of Industry Analysis. "The typical incentive programs simply do not resonate in today's economy."
(Read more...)
Posted by Michelle Krebs at 3:49 AM under Analysis , Chrysler , Companies , Featured , Ford , GM , Toyota | Comments (0) | digg this | del.icio.us
Fiat's Marchionne Is Bound for Detroit
DETROIT -- Fiat chief Sergio Marchionne immediately headed to Detroit Tuesday, a day after
President Barack Obama,gave Chrysler and Fiat only 30 days to pull together a deal if they had any hope for obtaining another $6 billion from U.S. taxpayers.
A Chrysler spokesman late on Monday announced a "framework agreement" with Fiat, reflecting progress since the two sides presented the broad outlines of a prospective alliance in January. "It's one step closer to the definitive agreement," a Chrysler spokesman said.
Under that framework, however, the Fiat's initial stake would be lowered to 20 percent from the originally planned 35 percent, according to various media reports. The government will allow Fiat to own no more than 49 percent of Chrysler.
(Read more...)
Posted by Michelle Krebs at 6:21 AM under Chrysler , Personalities | Comments (0) | digg this | del.icio.us
Obama Team Gives GM, Chrysler Viability Plans Failing Grades; Re-Do Is Ordered
By Michelle Krebs
DETROIT -- President Barack Obama, scheduled to take to the airwaves later this morning to discuss the plight of General Motors and Chrysler, gave the two automakers failing grades on their current viability plans and has given them more time to revamp them.
The viability plans submitted to the U.S. Treasury Department on February 17 "did not establish a credible path to viability," President Obama's automotive task force determined, and "are not sufficient to justify a substantial new investment of taxpayer resources."
The Obama administration will provide "adequate" working capital to give GM another 60 days to re-do its plan. Chrysler, which the task force concluded cannot survive on its own, gets another 30 days to complete its alliance with Italy's Fiat.
(Read more...)
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March Car Sales Look a Lot Like February Car Sales
By Michelle Krebs
SANTA MONICA, Calif. -- March car sales to be reported April 1 by manufacturers look a lot like February car sales, and that's not a good thing since March traditionally marks the kick off of the busy spring selling season.
"If sales continue at this pace all year, we're looking at a Seasonally Adjusted Annual Rate of only 8.9 million vehicles sold, which is slightly more than half of 2007 sales," said Edmunds.com CEO Jeremy Anwyl.
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Posted by Michelle Krebs at 12:06 PM under Analysis , Chrysler , Companies , Featured , Ford , GM , Toyota | Comments (1) | digg this | del.icio.us
Chrysler Rhetoric Gets Contradictory - and Desperate?
By Bill Visnic
AUBURN HILLS, Mich. -- In the weeks leading up to March 31, the day President Obama's auto industry task force gives some direction about whether the government will continue to invest billions to keep General Motors and Chrysler afloat, Chrysler executives have spoken in terms that seem to indicate a festering anxiety at the company's headquarters here.
In some cases, executives have issued threats. Some have deeply contradicted one another. Always-provocative CEO Bob Nardelli has contradicted himself.
And last Thursday, Chrysler Chief Financial Officer Ron Kolka violated the spirit of "we're all in this together" with probably the most inflammatory -- and reckless -- remark yet; Bloomberg News reported Kolka as saying Chrysler could be considered more deserving than GM of receiving continued government assistance.
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Global News: Volvo Truck Sales Collapse; Chrysler Stays in China; Valeo Ex-CEO Gets Golden Parachute
In Global News Tuesday, Swedish truckmaker AB Volvo's sales nosedived in February, Chrysler is focusing on imports to China and the French government is outraged over a golden parachute paid to the departing CEO of supplier Valeo.
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Posted by Michelle Krebs at 7:00 AM under Chrysler , Companies , News , Personalities | Comments (0) | digg this | del.icio.us
Cerberus' Feinberg: Hanging in With Chrysler and GMAC
Cerberus Capital Management, which owns large chunks of Chrysler and GMAC, plans to stick with the automobile and financial industries as long as possible, the founder of the New York-based private equity firm told a London newspaper.
"As far as GMAC and Chrysler are concerned, we will hang in there as long as it takes," the reclusive Steve Feinberg was quoted as saying by the Financial Times. "There is the feeling of a greater calling."
The paper's profile of Feinberg posted Tuesday quoted his friends as saying he always criticized them for buying foreign cars, but since buying 80 percent of Chrysler, he's "likely to lecture them for an hour on the subject."
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Survey Says: Americans Oppose Government Auto Loans
DETROIT -- And here comes yet another survey showing that Americans oppose government loans to General Motors and Chrysler, just as the two face a March 31 deadline to convince the government they have made progress, deserve to keep the money they've received and should get more.
This survey comes from Detroit-based R.L. Polk & Co., released on Monday. It shows 61 percent of Americans oppose the loans.
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Posted by Michelle Krebs at 10:11 AM under Analysis , Chrysler , GM , In the Media , Personalities | Comments (0) | digg this | del.icio.us
Global News: Auto Riches to Rags From Europe to Asia
In news from around the world Monday, auto magnates in Japan and Russia have seen their fortunes crippled, the outlook for Germany's economy has worsened, German automakers may pull out of the shortened Tokyo auto show and French supplier Valeo's chief executive has stepped down over a strategy disagreement.
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Posted by Michelle Krebs at 7:16 AM under Chrysler , Companies , News , Personalities | Comments (0) | digg this | del.icio.us
Obama Recognizes Unpopularity of Auto Bailout
President Barack Obama didn't give any hints about which way his administration was
leaning in terms of more loans to domestic automakers, General Motors and Chrysler. But he did acknowledge the unpopularity of such loans by the American public, during his interview with CBS' 60 Minutes
, which aired Sunday night.
The President said he is still committed to helping GM and Chrysler avert bankruptcy, but he says they have yet to demonstrate they can remain economically viable. And there are major political obstacles.
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Posted by Michelle Krebs at 8:33 AM under Business , Chrysler , GM , In the Media , Personalities | Comments (0) | digg this | del.icio.us
Abu Dhabi Investor Becomes Daimler's Biggest Shareholder
By Michelle Krebs
Even the seemingly strong and mighty need help in this dismal economic environment as was proven over the weekend when Germany's Daimler AG, parent of Mercedes-Benz, sold nearly $3 billion worth of shares to an Abu Dhabi investment firm. The stock sales will generate much-needed cash for the automaker and give Daimler a single large shareholder to ward off any potential takeover by an outsider.
The two companies announced Sunday night that Aabar Investments PJSC would buy 96.4 million of new Daimler shares for $2.7 billion. Aabar, with a 9.1 percent stake in Daimler, now becomes Daimler's largest shareholder.
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Newly Born Baby Boomers: What Cars Will They Buy?
By Michelle Krebs
When he was Toyota's top American executive, Jim Press often cited his visits to the hospital nursery to support his prediction that U.S. motor vehicle sales would hit 20 million units a year.
"What I see in each of those baskets is 20 purchase cycles," Press, now president of Chrysler, would say of the rows of babies -- future car buyers -- in cribs.
Press no longer predicts 20 million vehicle sales; instead he sees 14 million at best for the near future. Nevertheless the hospital nurseries are jampacked with a record number of new babies.
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Posted by Michelle Krebs at 7:04 AM under Chrysler , Commentary , News , Personalities , Toyota | Comments (0) | digg this | del.icio.us
Buick, Jaguar Tops For Vehicle Dependability
By Michelle Krebs
WESTLAKE VILLAGE, Calif. - Buick and Jaguar ranked highest in vehicle dependability, in a tie for first place in the J.D. Power and Associates 2009 Vehicle Dependability Study released Thursday morning.
Buick climbed to the top this year from sixth place in the 2008 rankings; Jaguar moved up from 10th place. Both surpassed Toyota and its luxury division Lexus, though Toyota and Lexus immediately followed in the No. 3 and 4 spots while also nabbing the most individual categories for vehicle dependability.
"Buick has ranked among the top 10 nameplates each year since the study was last redesigned in 2003, while Jaguar has moved rapidly up the rankings," David Sargent, vice president of automotive research at J.D. Power and Associates, said in a statement.
"Lexus remains a very strong competitor in long-term quality. In particular, the Lexus LS 430 sets the industry standard for dependability, with fewer problems reported than any other model in the study," Sargent added.
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Posted by Michelle Krebs at 6:38 AM under Analysis , Chrysler , Companies , Featured , Ford , GM , Toyota | Comments (0) | digg this | del.icio.us
Daimler Shops for Michigan Property, Tax Incentives
DETROIT -- German automaker Daimler AG plans to locate an engineering center near Ann Arbor, Michigan, home of the University of Michigan, to develop hybrid technology, if it receives tax incentives and finds suitable property, state and local officials say.
The subsidiary, to be called Mercedes-Benz Hybrid LLC, would employ about 223 engineers and technicians and would receive tax credits valued at $7.5 million over 10 years.
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AIG Angst: The Auto Industry and Detroit Protest Bonuses Loudest
By Michelle Krebs
President Obama and others on Capitol Hill expressed their indignation Monday over the revelation that American International Group Inc. (AIG) plans to reward its top executives with $165 million in bonuses despite the fact that the insurance giant is being kept afloat by U.S. taxpayers.
But no one is more outraged about the AIG bonuses than those in the auto industry, especially those in Detroit.
Michigan Congressman Gary Peters introduced a bill Monday night, one he's been promoting on the airwaves of business programs all day Tuesday, that allows the AIG bonuses to be paid -- and then taxes them at 100 percent to recover the cash for taxpayers.
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Posted by Michelle Krebs at 12:20 PM under Chrysler , Commentary , Companies , GM , Personalities | Comments (2) | digg this | del.icio.us
Memo to Obama Auto Task Force: It Ain't About Labor
By Bill Visnic
This week, the United Auto Workers union agreed to more cutbacks to help the Detroit Three automakers get back on their feet. The UAW rank and file at Ford ratified concessions. UAW and General Motors negotiators reportedly hammered out similar concessions Tuesday night that will be voted on by GM workers. Next up for give-backs will be Chrysler workers.
But once again, the predicament the Big Three are in isn't about labor costs; it's about the product.
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Posted by Michelle Krebs at 4:40 AM under Chrysler , Commentary , Companies , Featured , Ford | Comments (3) | digg this | del.icio.us
Obama Auto Task Force: What Did They Think About Their Detroit Visit?
By Michelle Krebs
DETROIT -- You could imagine a collective sigh of relief as General Motors and Chrysler executives closed their doors late Monday behind the most important guests they've ever had visit.
And you could imagine them wondering what kind of impression they had made on the representatives of President Obama's automotive task force that will decide their fate. "So what did they think?" they must have been asking.
Yet those task force members, none of whom have automotive experience, remain as poker faced as any card player, not providing even the slightest hint about their impressions of their Detroit visit, their thoughts on the precarious situations of GM and Chrysler and their plans for what they will do when the March 31 deadline arrives.
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Posted by Michelle Krebs at 8:06 AM under Business , Chrysler , Companies , Featured , GM , Personalities , Toyota | Comments (1) | digg this | del.icio.us
Tracinda's Jerry York Says "I Told You So" in More Polite Terms
You just know Jerome York is dying to say it: "I told you so."
The former Chrysler executive who served on General Motors' board of directors representing the interests of billionaire Kirk Kerkorian, had insisted the Detroit automaker ditch money-losing Saab and Hummer. But GM executives refused to entertain the notion. They insisted the automaker's many brands were an asset: not, as York contended, a drain on resources.
Now look where GM is -- staying afloat on government loans as it sets Saab loose and has Hummer on the auction block with a plan to eliminate it if no buyer is found.
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Posted by Michelle Krebs at 7:20 AM under Chrysler , Commentary , Companies , Ford , GM , Personalities | Comments (0) | digg this | del.icio.us
UAW Accepts Ford's Better Idea
By Bill Visnic
Rank-and-file members of the United Auto Workers union yesterday gave the union the authority to make amendments to the union's 1997 contract with Ford in order to help the automaker further ease its labor costs and debt burden.
The positive vote was not overwhelming: The Detroit News reports only about 58 percent of the UAW's production and skilled-trade members who work for Ford agreed to the contract changes. But the majority of UAW workers went for the deal, meaning Ford has won another important battle in the war to improve its balance sheet.
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Chrysler's Jim Press: "Things Aren't So Bad"
By Michelle Krebs
AUBURN HILLS, Mich. -- Chrysler is looking for March sales to be better than those in February, a month that Chrysler President Jim Press said was not bad.
In an interview with AutoObserver.com, Press said Chrysler has in place for March all the programs that worked well in February and then some.
"It's hard to say things are good when sales were only down 25 percent [retail]. That's terrible, but it's less terrible than the industry decline of 40 percent," said the always upbeat Press. "Things aren't so bad. At 80,000 vehicles sold in February, we're doing OK. We're not paying dividends or bonuses but we're OK."
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Despite Economy, Auto Shows Remain Crucial Marketing Stage
By Dale Buss
Nissan just announced that it plans to stay away from the North American International Auto Show in Detroit next year, as the company did this year. It also plans to skip other major U.S. shows and dozens of smaller ones scattered across the country, as well as the Frankfurt exhibition this September.
But as auto company executives, suppliers and the global news media gathered in Geneva last week for one of the most prestigious regular shows, Nissan appears to be alone in its strategy of making draconian cuts in its annual exhibition budget to help get costs under control in this severe sales environment.
In fact, most other automakers -- even badly damaged Chrysler -- so far are making it a point to stick with their expensive investments in auto-show participation.
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Posted by Michelle Krebs at 8:10 AM under Analysis , Chrysler , Companies , Featured , Ford , GM , Toyota | Comments (2) | digg this | del.icio.us
Buyers, Buyers Everywhere - Or Is That 'Interested Parties?'
By Bill Visnic
With industry trade journal Automotive News this week quoting a spokesman from General Motors Corp.'s Saturn division as saying there are prospective buyers for the perpetually underachieving division, it occurred to AutoObserver that the auto-industry conventional wisdom on this subject is dead wrong: the global economic disintegration hasn't dissuaded anyone from considering investment in a money-bleeding car brand.
There are, in fact, buyers everywhere. After all:
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Posted by Michelle Krebs at 4:09 AM under Analysis , Chrysler , Companies , Ford , GM | Comments (1) | digg this | del.icio.us
Chrysler Cuts Canadian Minivan Production
By Bill Visnic
In its recent restructuring plan submitted to the U.S. Department of Treasury, Chrysler LLC promised to eliminate a shift of production at a North American assembly plant this year, and now it's known where the cut will come: the company announced it will eliminate the third shift at its minivan assembly plant in Windsor, Ontario, Canada.
The move is not unexpected - although minivans still account for a significant portion of Chrysler's total sales, minivan sales have long been trending downward. Sales for Chrysler's Dodge Caravan are off 36 percent so far this year, with Chrysler Town & Country sales slumping 41 percent.
(Read more...)
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February Car Sales: Fearful Americans Hunker Down, Steer Clear of Dealer Showrooms
By Michelle Krebs and Bill Visnic
DETROIT - Americans, unemployed or fearing they will be, hunkered down last month, cutting their household budgets, squirreling away money and avoiding dealer showrooms as February car sales sunk to their lowest level of any February in more than four decades.
Automakers sold 691,073 vehicles in February, down 40.9 percent from the 1,168,729 they sold in February a year ago. That marked the lowest level of car sales for any February since 1967, according to General Motors' record books. That fact is even more eye-popping when population is considered: in 1967, the U.S. had 103 million registered drivers; today the nation has nearly twice that many.
And it put the closely-monitored Seasonally Adjusted Annualized Rate (SAAR) at 9.1 million vehicles, the lowest SAAR since 1982.
Not coincidentally, consumer confidence, a key indicator for how vehicle sales will fare, sunk to record lows in February, according to at least two measurements. And much of that has to do with dimming employment picture as well as dwindling household worth.
(Read more...)
Posted by Michelle Krebs at 8:57 AM under Analysis , Chrysler , Companies , Featured , Ford , GM , Toyota | Comments (1) | digg this | del.icio.us
Consumer Confidence Drops as Do February Car Sales
Americans' confidence in the U.S. economy fell in February, and it showed with a lack of activity in dealer showrooms last month. Automakers report February sales Tuesday, and the annualized rate is likely to be the lowest since the early 1980s.
A key indicator that drives car sales is consumer confidence, which had been edging up since last fall but fell back in February.
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Posted by Michelle Krebs at 7:45 AM under Business , Chrysler , Companies , Ford , GM | Comments (0) | digg this | del.icio.us
GM Plight: An Example of 'Day of Reckoning'
White House Chief of Staff Rahm Emanuel had some harsh words for General Motors on a Sunday news program, prompting questions about what the Obama administration has in mind for restructuring GM and Chrysler.
Emanuel told CBS' Face the Nation GM's situation is "a wakeup call to America" to increase energy independence and overhaul the nation's health care system. GM's plight is an example of "a day of reckoning," Emanuel said.
(Read more...)
Posted by Michelle Krebs at 7:37 AM under Chrysler , Commentary , Ford , GM | Comments (1) | digg this | del.icio.us
Chrysler Restructuring Plan: Three Options, One Reality
By Bill Visnic
The restructuring plan Chrysler LLC submitted February 17 to the U.S. Department of Treasury maps three potential outcomes -- and all will be expensive.
Short of the most-drastic scenario -- liquidation -- Chrysler's other two options, if they are to lead to the company's long-term viability, are dependent on a number of questionable assumptions and one indisputable fact: If auto sales in the U.S. do not increase quickly and markedly, nothing Chrysler does is likely to pull it from its death spiral.
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Posted by Michelle Krebs at 4:35 AM under Analysis , Chrysler , Featured | Comments (0) | digg this | del.icio.us
America Losing Interest in Keeping Detroit Afloat
A survey conducted by the USA Today newspaper and Gallup poll this week found only 25 percent of Americans believe the government should continue lending money to Detroit automakers.
"That's a huge, and fast, change of heart," said USA Today's Jim Healey, who added that in December, before the government approved emergency auto loans, 61 percent favored federal help for the automakers.
(Read more...)
Posted by Michelle Krebs at 3:56 AM under Analysis , Chrysler , Companies , Ford , GM | Comments (2) | digg this | del.icio.us
UAW Cornered on VEBA?
By Bill Visnic
With the United Auto Workers (UAW) submitting to its rank and file a proposed Ford Motor Co. amendment to the 2007 labor contract that asks the UAW to accept half of Ford's obligation to the union's Voluntary Employee Benefit Association trust, UAW leadership appears to be choosing the lesser of potential evils.
If any of the Detroit Three automakers that owe payments to the VEBA -- an amount totaling nearly $60 billion -- declare or are otherwise forced into bankruptcy, the trust that was established to fund health-care costs for UAW retirees could be shattered, says one bankruptcy expert.
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Posted by Michelle Krebs at 3:44 AM under Analysis , Chrysler , Companies , Featured , Ford , GM | Comments (0) | digg this | del.icio.us
February Car Sales: Consumers Sit the Month Out Again
By Michelle Krebs
SANTA MONICA, Calif. -- The still-deteriorating economy and the continued uncertainty about employment kept consumers away from buying new cars again in February despite the record-breaking deals available to them.
February car sales, to be posted by automakers Tuesday, are expected to be down about 40 percent from a year ago to 685,000 vehicles sold for the month, according to Edmunds.com, parent of AutoObserver.com.
That puts the closely watched Seasonally Adjusted Annual Rate (SAAR) for the month at 9.3 million vehicles, down from 9.6 million the previous month.
"The fluctuation in car sales and the instability of the stock market are just two examples of the volatility in the marketplace, which is wreaking havoc on consumer confidence and hampering any economic recovery," said Jesse Toprak, Edmunds.com's executive director of Industry Analysis.
(Read more...)
Posted by Michelle Krebs at 10:13 AM under Analysis , Chrysler , Companies , Featured , Ford , GM , Toyota | Comments (0) | digg this | del.icio.us
Beijing Auto Denies Interest in Chrysler
Chinese automaker Beijing Automotive Industry Co. denied Monday that it was in talks with 
Chrysler about buying assets or technology from the Detroit automaker, Reuters
reported.
The denial came in response to a Chinese Business News report, citing an unnamed executive at Beijing Auto, that the companies had initial talks.
Though Chrysler no longer has a car-making venture with Beijing Auto, the Chinese company still produces Chrysler 300 models for the local market.
(Read more...)
Posted by Michelle Krebs at 7:18 AM under Business , Chrysler , Rumors , Technology | Comments (0) | digg this | del.icio.us
President Obama's Auto Task Force Meets
WASHINGTON -- President Barack Obama's newly established automotive task force met for the first time Friday morning to consider the latest requests for as much as $21.6 billion for new government loans by General Motors and Chrysler and review the companies' viability plans submitted to the U.S. Treasury Tuesday.
The panel, still reviewing the hundreds of pages of documents submitted by GM and Chrysler, was not expected to make any decisions at its first session. Still, the panel does have substantial power to make critical decisions, including if GM and Chrysler should receive more loans, if they should file for bankruptcy or if they should merge. They can approve or reject any major transaction of the companies of $100 million or more. And they can recall the loans.
(Read more...)
Posted by Michelle Krebs at 10:39 AM under Business , Chrysler , GM | Comments (0) | digg this | del.icio.us
Chrysler Needs Extra Billions To Continue; 3,000 More Jobs Cut
AUBURN HILLS, Mich. -- Chrysler's viability plan submitted late Tuesday to the U.S. Treasury
Department asks for another $2 billion in federal loans, bringing its total request to $9 billion.
The additional $2 billion request means Chrysler is seeking $5 billion by March 31 -- rather than $3 billion -- that it says is required to continue operations.
Chrysler's preliminary "viability plan" said it will eliminate more jobs -- another 3,000. It also will rid itself of three more models -- Dodge Durango and Chrysler Aspen and PT Cruiser -- and another production shift. In addition, Chrysler said it has a framework for an agreement of cost-saving concessions from the United Auto Workers (UAW) union, its dealers, its suppliers and second-lien lenders.
(Read more...)
Posted by Michelle Krebs at 2:15 PM under Business , Chrysler , Featured , News | Comments (0) | digg this | del.icio.us
GM, Chrysler Bankruptcy Not Impossible, Obama Aide Says
DENVER -- President Barack Obama's chief spokesman said the administration can't rule out a restructuring through bankruptcy for struggling automakers, while adding the industry is "tremendously important" to the economy, Bloomberg News reported Tuesday afternoon.
Traveling to Colorado on Tuesday with the president, who signed the economic stimulus package, White House press secretary Robert Gibbs told reporters the administration won't "prejudge" the next steps for General Motors and Chrysler until the automakers present their own plans under terms of a government aid package. Those plans are to be filed after the stock market closes today.
The auto companies "represent a huge part of our manufacturing base, and to have a strong and viable auto industry is tremendously important for the future."
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Posted by Michelle Krebs at 12:28 PM under Business , Chrysler , GM , Personalities | Comments (0) | digg this | del.icio.us
Fiat Seeking Cash, Reports Say
Fiat, which has an alliance agreement with Chrysler, reportedly is seeking about $2.5 billion
from investment banks to pay off debt owed this year and to avoid having its credit rating lowered to junk status. The Italian automaker officially denies the reports that came from unnamed sources.
The media reports say Fiat hasn't decided to proceed with a funding plan while the company said it isn't studying a capital increase. Still, Fiat has said it won't pay a dividend for 2008 after its debt climb at year-end and is likely to rise in the first half.
(Read more...)
Posted by Michelle Krebs at 12:26 PM under Business , Chrysler , Companies | Comments (0) | digg this | del.icio.us
Chrysler, Global Sales Slump Prompt Daimler Loss
Daimler AG reported a $1.9-billion loss in the fourth quarter of 2008, its first quarterly loss since 2007.
The German automaker blamed declining global sales and costs related to its 19.9-percent stake in Chrysler for its loss. Further, the company warned that the continued worldwide recession would hurt Daimler's 2009 earnings as well.
Daimler's fourth-quarter loss, its first quarterly loss since the third quarter of 2007, was steeper than analysts had predicted, prompting its stock price to fall by more than 7 percent in early trading Tuesday.
(Read more...)
Posted by Michelle Krebs at 11:25 AM under Business , Chrysler , Companies | Comments (1) | digg this | del.icio.us
Viability Day for GM, Chrysler: Is Bankruptcy Looming?
By Michelle Krebs
DETROIT -- Today is V-Day -- Viability Day -- for General Motors and Chrysler.
As part of their acceptance of $17.4 billion in government loans to stay afloat, the two must submit reports on their progress regarding how they are becoming economically viable.
Increasingly experts believe one or both ultimately will file for Chapter 11 reorganization under U.S. bankruptcy laws, particularly because auto sales have continued their plummet.
"If I were betting, I'd say it (Chapter 11 filing) will happen," said Douglas Bernstein, a lawyer specializing in bankruptcy and a managing partner with the Detroit law firm of Plunkett Cooney.
(Read more...)
Posted by Michelle Krebs at 7:26 AM under Analysis , Chrysler , Companies , Featured , Ford , GM | Comments (1) | digg this | del.icio.us
Switch to Federal Auto Restructuring Team May Signal More Time for Automakers
By Bill Visnic
WASHINGTON -- In placing the duty of overseeing the restructuring of the businesses of General Motors Corp. and Chrysler LLC in the hands of a federal-agency coalition rather than a single "car czar," the administration of President Barack Obama could be signaling that the automakers will have more time to reorganize beyond the originally intended March 31 deadline.
Given the fluid nature of the industry's upheaval and the nation's economy, having definitive reorganization plans in place by March 31 may be asking the impossible: Filing their interim restructuring reports Tuesday, GM and Chrysler still face a rapidly devolving industry landscape -- and several sources are saying a government-managed bankruptcy is not out of the question.
(Read more...)
Posted by Michelle Krebs at 6:53 AM under Chrysler , Ford , GM | Comments (0) | digg this | del.icio.us
Chrysler-Nissan Project Put on Hold: What's Next for Both?
By Michelle Krebs
DETROIT -- Chrysler and Nissan have put on hold their proposed arrangement to build vehicles for each other as they each evaluate their deteriorating financial situations in a worsening global economy and historically dismal car market.
The two companies had announced last spring that Chrysler would build a Dodge Ram-based replacement for the Nissan Titan
while Nissan would provide Chrysler with Nissan-based small cars, one of which would be sold as the Dodge Hornet.
The on-hold project raises questions about Chrysler's ability to move forward with a partner and Nissan's product plans for North America.
(Read more...)
Posted by Michelle Krebs at 10:59 AM under Analysis , Chrysler , Featured , News | Comments (2) | digg this | del.icio.us
Chicago Auto Show: Calm Before the Storm
By Bill Visnic
This week's Chicago auto show isn't expected to be chock-full of prominent concept- or production-car introductions, as automakers hunker down to evaluate how best to absorb still-disintegrating auto sales.
More important, Chicago comes after a definitely somber Detroit auto show - and just before General Motors Corp. and Chrysler LLC are scheduled to present the next phase of their restructuring "blueprints" to federal officials on Feb. 17. From there, the two automakers must present the full case by March 31 that they are "viable" and worthy of more government investment - a cash infusion both say they need to avoid bankruptcy.
So the Chicago show will make the most of introductions that are, for the most part, likely to reflect these less-ebullient industry times.
(Read more...)
Posted by Michelle Krebs at 2:18 PM under Chrysler , Companies , Featured , Ford , GM , Toyota | Comments (1) | digg this | del.icio.us
Chrysler Hit by Lawsuits; Is Bankruptcy A Way to Cope?
By Michelle Krebs
Chrysler has been socked by two lawsuits in as many days, prompting at least one expert to wonder if more lawsuits can be expected and force Chrysler into official bankruptcy proceedings.
French-based Faurecia has sued Chrysler, claiming the automaker owes the supplier $110 million for engineering and research costs as well as handing its research over to the Chinese.
Another lawsuit filed in Delaware charges Chrysler is automatically denying workers' compensation claims over a spinal-cord treatment for employees injured on the job. The suit seeks class-action status.
Meantime, a bankruptcy lawyer in Detroit suggests a flurry of lawsuits is often a reason for companies to file for bankruptcy.
(Read more...)
Posted by Michelle Krebs at 1:14 PM under Analysis , Chrysler , Commentary , Featured | Comments (0) | digg this | del.icio.us
GM Plans Job and Pay Cuts, Reports Say
General Motors will cut salaried jobs and cut salary of remaining salaried employees, various reports quoting unnamed sources say.
GM -- and Chrysler -- have a February 17 deadline to meet and show the government they have viability plans that will allow them to keep the government loans they received. GM has received $13.4 billion.
(Read more...)
Posted by Michelle Krebs at 11:09 AM under Chrysler , GM , Rumors | Comments (0) | digg this | del.icio.us
GM, Chrysler May Be Forced Into Bankruptcy, Report Says
General Motors and Chrysler may have to be forced into bankruptcy by the U.S. government to assure repayment of $17.4 billion in federal bailout loans, Bloomberg News reported Monday.
Automakers have long argued bankruptcy would be sure death, as consumers will not buy cars and trucks from a bankrupt automaker. Still, experts argue placing them in bankruptcy is possible due to the priority line for creditors.
(Read more...)
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Supplier Group Asks for $25B in Bailout Help
The Motor & Equipment Manufacturers Association (MEMA) this week submitted a request to the U.S. Dept. of Treasury for $25.5 billion in federal aid to help its auto-industry supplier members weather the deepening financial crisis that has gripped the domestic auto industry.
The Wall Street Journal
reports MEMA's request came to light this week as U.S. House members met with representatives from the state of Michigan to discuss the auto industry's troubles. MEMA represents some 400 auto-industry suppliers, a significant portion of which are believed to be mirroring the financial distress of their primary customers, the Detroit Three automakers, and, to a lesser extent, transplant manufacturers who also are battling a prolonged downturn in U.S. auto sales.
(Read more...)
Posted by Bill Visnic at 8:52 AM under Business , Chrysler , Companies , GM , News | Comments (0) | digg this | del.icio.us
Fleet Cutbacks Help Shrink January Sales to Early-1980s Levels
By Dale Buss and Bill Visnic
Two huge drags on the U.S. auto market - an utter lack of consumer confidence, and a paucity of credit -- persisted in January and were joined by a new one: at least a temporary evaporation of the fleet market.
Industry-wide sales in January cratered from a year earlier, falling by 36.9 percent, to about 677,000 units from 1.06 million vehicles sold in January 2008. The seasonally adjusted annual sales rate fell to fewer than 10 million units for the first time in more than 26 years. And the American auto business sold fewer cars than for any month since the depths of a recession in December 1981.
(Read more...)
Posted by Bill Visnic at 5:14 PM under Analysis , Business , Chrysler , Featured , Ford , GM , News , Toyota | Comments (2) | digg this | del.icio.us
Automakers Boost Incentive Spending, Edmunds.com Says
SANTA MONICA, Calif. - Automakers, in an effort to clear out old inventory and pare rising stockpiles of unsold cars, boosted incentive spending dramatically from a year ago, according to estimates calculated by Edmunds.com
, parent of AutoObserver.com
.
"Automakers need to clear out leftover inventory from the 2008 model year, and that effort is boosting the average incentive cost for the industry," said Jesse Toprak, Edmunds.com's executive director of Industry Analysis. "Last month, 27 percent of all new vehicles sold were from the 2008 model year while during January 2008, only 12 percent of new vehicle sales were from the previous model year's inventory."
(Read more...)
Posted by Michelle Krebs at 4:04 AM under Analysis , Chrysler , Companies , Ford , GM | Comments (0) | digg this | del.icio.us
Fiat Is Chrysler's Only Dance Partner Now, Press Says
By Kevin Smith
LOS ANGELES -- Chrysler President Jim Press told a roundtable of media in Los Angeles that the only party the automaker is in discussions for an alliance with at the moment is Italy's Fiat.
"We're in conversation with Fiat only," Press said. "It's a potential alliance that makes a lot of sense. It brings fuel-efficient technology here quickly. It preserves jobs because dealers can expand their market coverage, and we use excess North American manufacturing capacity. We get a platform for export back into Fiat's worldwide distribution."
(Read more...)
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Few Auto Ads Air on Super Bowl
By Michelle Krebs
Super Bowl audiences will see a dearth of car ads during Sunday's big game, and they will see none from Detroit's ailing automakers. Only Audi and Hyundai, back for the second year as they seek to increase market share in the game, and Toyota will advertise during the game.
The cost of the ads, which hit the $3-million mark for a 30-second spot (of which there will be nearly 50) this year, is significant barriers to entry for automakers with auto sales slumping to their lowest levels since the early 1980s and most companies struggling to turn a profit. And the payoff is mixed for advertisers, even though the Super Bowl attracts millions of eyeballs.
(Read more...)
Posted by Michelle Krebs at 5:46 AM under Business , Chrysler , Companies , Ford , GM , In the Media , Toyota | Comments (1) | digg this | del.icio.us
COMMENTARY Behind the Headlines: News and Maneuvers Get Weirder
By Bill Visnic
The auto industry seemed to have reached agreement earlier this month to hunker down and allow the geared-down Detroit auto show to flicker on without anything as distracting as news to interfere.
That all changed this week, as it seems everyone's talking, dealing, reporting, conjecturing and speculating. Plenty of this news is explicitly bizarre.
A rundown of some of this week's happenings, along with the between-the-lines summary courtesy of AutoObserver's branded decoder ring:
(Read more...)
Posted by Michelle Krebs at 5:04 PM under Chrysler , Commentary , Companies , Featured , Ford , GM , Personalities | Comments (0) | digg this | del.icio.us
January Car Sales Drop From December on Fewer Fleet Sales, Edmunds.com Forecasts
SANTA MONICA, Calif. -- U.S. car and truck sales in January are expected to come in at a weak 730,000 units when automakers report them Tuesday.
January sales are expected to be down 18.1 percent from very weak sales in December, Edmunds.com estimates, largely due to significantly lower rental-car and corporate fleet sales. Retail sales will be about flat with December's.
"Our research indicates that retail sales are pretty much flat compared with December," said Jesse Toprak, Edmunds.com's executive director of Industry Analysis. "However, automakers' decision to cut fleet sales and make other production cuts will cause a large sales decline to be recorded on the books."
(Read more...)
Posted by Michelle Krebs at 9:21 AM under Analysis , Chrysler , Companies , GM , Toyota | Comments (1) | digg this | del.icio.us
UAW Jobs Banks Gone From Big Three
DEARBORN, Mich. -- Ford said Thursday the United Auto Workers (UAW) union agreed to end its Jobs Bank for laid-off employees as the union had done with General Motors and Chrysler.
Elimination of the controversial Jobs Bank, which gives laid-off workers nearly full pay though they aren't working, was a requirement for GM and Chrysler to keep their loans from the U.S. government. Though Ford has not taken federal money, the automaker insisted it would not be disadvantaged and expected the same concessions the union granted to GM and Chrysler.
(Read more...)
Posted by Michelle Krebs at 4:56 AM under Business , Chrysler , Ford , GM | Comments (0) | digg this | del.icio.us
Chrysler's Press: On Sales, Incentives, Cash and Alliances
LINTHICUM HEIGHTS, Md. -- Chrysler President Jim Press told reporters here that it has other possible partners it can tap in case the Fiat alliance
doesn't work out, that the automaker's new incentives are helping its market share this month and that it needs the additional $3 billion in federal loans to survive the first quarter.
Press held a roundtable with reporters as he tours the country visiting dealers, urging them to push out the old 2008 inventory and order more 2009 models so Chrysler can keep its factories running and badly needed cash coming in.
(Read more...)
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Volkswagen Orders Routan Production Halted
Volkswagen AG confirmed reports that it asked Chrysler to suspend production of its new Routan minivan during the month of February due to weak demand, the Windsor Star
in Ontario, Canada, reported.
VW contracts Chrysler to build the minivan, based on the Chrysler Town & Country and Dodge Grand Caravan, at its plant in Windsor.
A VW spokesman told the Windsor Star Routan production would resume in March.
(Read more...)
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Grounded Citicorp Joins Big Three
Welcome to the club - the corporate jetless club, Citicorp executives. You are in good company.
Despite taking $50 billion in federal funds to stay afloat, Citicorp only canceled delivery of a fancy $50-million corporate jet when the American public found out -- and a U.S. Senator gave bank officials a public tongue lashing.
U.S. Sen. Carl Levin, D-Mich., who advocated federal help to Detroit automakers, has been cheesed about Congress' double standard for the banks and the automakers.
(Read more...)
Posted by Michelle Krebs at 7:12 AM under Chrysler , Commentary , Ford , GM | Comments (0) | digg this | del.icio.us
Dealer Dilemma: Stuck With Old Models; Pressured To Order New Ones
By Michelle Krebs
DETROIT -- In Washington, the talk is of what cars automakers will produce in 2011, 2016 and 2020, but the auto industry faces an immediate demand: sell cars today.
Dealers, particularly, face a challenging dilemma as to just how to do that. The auto manufacturers, notably General Motors and Chrysler, are pressuring them to order more 2009 models so that factories can remain open and the automakers can book revenue.
Yet, dealers are buried with bulging stockpiles of old models, becoming increasingly expensive to keep and eating into their bottom-line. Yet, even hefty incentives aren't attracting buyers.
(Read more...)
Posted by Michelle Krebs at 10:39 AM under Analysis , Chrysler , Featured , Ford , GM , Toyota | Comments (0) | digg this | del.icio.us
Chrysler Greets Fiat Visitors
By Michelle Krebs
AUBURN HILLS, Mich. -- Chrysler had a visit from executives of Italy's Fiat this weekend, including its high-profile CEO, Sergio Marchionne
.
Chrysler CEO Bob Nardelli told employees in a memo Monday that the executives from Fiat held meetings at the company's headquarters over the weekend. He characterized the meeting as positive and said the "alliance is very promising."
Fiat has offered to take a 35 percent stake in the Detroit automaker in a deal that could be completed by the end of April. It could eventually raise that stake to 55 percent.
(Read more...)
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GM Looks to 'Policy Discussion' on States' Emissions Maneuvering
By Bill Visnic
So starts the auto industry's cautious waltz with the administration of new President Barack Obama.
Anxious to reverse negative environmental perceptions (most of them realities, to be sure) about the Bush administration, President Obama has instructed the U.S. Environmental Protection Agency (EPA) to make haste in deciding the case of application for waiver by California -- and 13 other states that have adopted California's auto-emissions regulations -- to regulate vehicular carbon-dioxide emissions.
(Read more...)
Posted by Michelle Krebs at 10:28 AM under Chrysler , Companies , Ford , GM | Comments (0) | digg this | del.icio.us
Chrysler-Badged Fiats Two Years Away
Chrysler Vice Chairman Jim Press announced at the National Automobile Dealers Association gathering in New Orleans this weekend that a Chrysler-badged Fiat could be introduced in less than two years. The company is reportedly looking at the Fiat 500, Panda and Punto models, but has not decided on a platform.
At the same time, Chrysler CEO Bob Nardelli sent a letter to company employees Friday confirming the development of a new Dodge Durango SUV as well as a Dodge Charger and Chrysler 300 sedan.
(Read more...)
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UAW Ends Chrysler Jobs Bank
The United Auto Workers (UAW) union has agreed to end its controversial Jobs Bank at Chrysler that pays workers on layoff, effective Monday.
The Jobs Bank became a lightening rod during last fall's Congressional hearings on government aid to U.S. automakers and its elimination was part of the agreement to obtain the federal loans.
(Read more...)
Posted by Michelle Krebs at 6:47 AM under Business , Chrysler , Ford , GM | Comments (0) | digg this | del.icio.us
Volvo, Saab: Diverging Future Paths
Detroit automakers General Motors and Ford have both put up for strategic review their
Swedish brands, but the companies appear to be taking different paths for disposing of the marques.
Saab is in negotiations with owner GM and the Swedish government to reestablish itself as an independent company, according to a report in Europe's Autocar magazine.
Ford will begin taking bids for Volvo next month and expects some of
those bidders to be Chinese automakers, Bloomberg
News
reports.
(Read more...)
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Fiat-Chrysler Marriage Is Troubled Even Before Consummation
By Michelle Krebs
The proposed marriage between Chrysler and Italy's Fiat is showing signs of strain even before it is consummated.
Some Congressmen already are expressing concern about Chrysler's planned alliance with a foreigner and using federal funds to do so. Fiat has made obtaining additional federal funds a condition of the wedding to occur.
At the same time, Fiat's turnaround showed its fragility as the automaker reported fourth-quarter earnings that plummeted and a cash burn that is raging.
(Read more...)
Posted by Michelle Krebs at 7:53 AM under Business , Chrysler , Companies | Comments (0) | digg this | del.icio.us
Chrysler-Fiat Alliance Gets More Interesting With PSA Presence
By Bill Visnic
Still digesting the possibilities and likelihood of the proposed alliance between Chrysler LLC and Fiat S.p.A? Add French automaker PSA Peugeot-Citroen to the mix.
The potential for a triumvirate comprised of Chrysler, Fiat and PSA either makes the situation more intriguing -- or more preposterous.
Reports from Europe saying suddenly hookup-hungry Fiat is building a war chest to fund a potential takeover of or, more likely, a merger with PSA were denied on Thursday, the same day Fiat's ability to sling money into any deal came under pressure as it revealed in its own shattered financials, including its heavy cash burn and a deeply cut profit forecast for 2009.
(Read more...)
Posted by Michelle Krebs at 6:25 AM under Analysis , Chrysler , Companies , Featured | Comments (1) | digg this | del.icio.us
Car Czar Gives Way to Car Czars
By Michelle Krebs
Timothy Geithner, President Barack Obama's nominee for U.S. Treasury Secretary, testified to Congress Wednesday that the new administration intended to assembly a team of experts to oversee the loans to automakers.
Geithner told the Senate Finance Committee during his confirmation hearings that the team would have "expertise in manufacturing, in restructuring, who understand how these labor contracts work."
Automakers should be thrilled at the news since it was frighteningly evident during last fall's Congressional hearings on aide to U.S. automakers that most government officials and Congressmen are generally ignorant about the extremely complex auto industry. Finding a single individual who understood all of the aspects of the auto industry would be impossible. And if President Obama's picks for other government posts are any indication, the car czars will a bright, talented and pragmatic lot.
(Read more...)
Posted by Michelle Krebs at 8:23 AM under Chrysler , Commentary , Ford , GM , Personalities | Comments (0) | digg this | del.icio.us
Threesome: Fiat Looks To Link With Peugeot as Well as Chrysler, Reports Say
By Michelle Krebs
Only days after Italian automaker Fiat and Chrysler announced they were hooking up, word in Europe is that Fiat also is working on a possible merge with France's PSA Peugeot Citroen.
The Fiat-Chrysler-Peugeot threesome would create the world's third-largest automaker behind Toyota and General Motors with a total production of about 8.8 million vehicles, based on 2007 figures, analysts estimate.
(Read more...)
Posted by Michelle Krebs at 6:33 AM under Chrysler , Companies , Featured | Comments (0) | digg this | del.icio.us
Chrysler-Fiat Could Find Welcoming Marketplace, Experts Say
By Dale Buss
If the Chrysler-Fiat alliance makes it out of the crib, the
combination could provide each company with some potent new assets in the U.S. and global marketplace.
Chrysler could badge fuel-efficient, Fiat-based or -built small cars under its Chrysler brand and fill out the American industry's weakest car lineup as well as gain access to Fiat's
global retail network. Broader distribution of Chrysler's iconic Jeep brand -- into Asia, for instance -- would be one possibility.
(Read more...)
Posted by Michelle Krebs at 7:24 AM under Analysis , Business , Chrysler , Companies | Comments (0) | digg this | del.icio.us
Fiat CEO Marchionne Has Led an Unlikely Turnaround
By Dale Buss
Sergio Marchionne has been predicting an epic consolidation of the global automotive business for several months now. And by striking a perhaps slyly sensible new partnership with Chrysler, Fiat's determined CEO already has taken the industry's biggest and boldest step toward fulfilling his scenario.
The 56-year-old Italian is credited with Fiat's financial turnaround since 2004 but also much more: He's increasingly seen as a visionary who has the guts to shape the industry's future rather than just react to it.
(Read more...)
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COMMENTARY: Fiat-Chrysler Link Is Nice Idea, but Futile Without Money
By Bill Visnic
Fiat S.p.A.'s acquisition of 35 percent of Chrysler has all the good-sounding trappings of an auto-industry alliance that, under normal circumstances, would indicate another industry tie-up that might bear fruit.
But in the supercharged atmosphere currently surrounding the auto sector -- and particularly the at-risk U.S. domestic automakers -- the deal is being considered by some as the salvation of Chrysler.
The prolongation of Chrysler's likely dissolution is the more viable assessment of Tuesday's announced Fiat-Chrysler deal because it includes no cash infusion to Chrysler.
(Read more...)
Posted by Michelle Krebs at 4:31 AM under Analysis , Business , Chrysler , Commentary , Featured | Comments (0) | digg this | del.icio.us
Chrysler, Fiat Sign Global Strategic Alliance Deal
By Michelle Krebs
Auburn Hills, Mich. -- Chrysler confirmed early Tuesday morning that it, along with its majority owner Cerberus Capital Management, had signed a deal with Italy's Fiat to establish what it called a global strategic alliance.
Chrysler said the alliance is a key element of its viability plan that must be submitted to Congress by the end of this quarter. The automaker said in a statement posted on its Web site that the alliance would allow Fiat and Chrysler to take advantage of each other's distribution networks and "optimize fully their respective manufacturing footprint and global supplier base."
(Read more...)
Posted by Michelle Krebs at 4:27 AM under Business , Chrysler , Companies , Featured , News | Comments (1) | digg this | del.icio.us
Chrysler Launches 0% Financing With Government Help
By Michelle Krebs
DETROIT -- Within hours of its credit arm obtaining $1.5 billion in federal loans, Chrysler LLC announced incentives of zero-percent financing for up to 60 months on select 2008 and 2009 model year Chrysler, Jeep and Dodge vehicles through Chrysler Financial, effectively immediately.
In addition to the incentives, Chrysler Financial will loosen its previously tightened credit requirement to now include customers with scores in the 620 range.
(Read more...)
Posted by Michelle Krebs at 12:13 PM under Business , Chrysler , Featured , News | Comments (0) | digg this | del.icio.us
Diesel Pickups Dumped By Detroit?
By Bill Visnic
Remember those diesel-engine light-duty pickups we're supposed to be seeing this year? Get ready to hear the words "back burner" in relation to those product plans.
General Motors Corp., Ford Motor Co. and Chrysler LLC all said as long ago as 2007 they would have diesel engines, respectively, for the GMT 900 pickup line (Chevy Silverado/GMC Sierra); the Ford F-150 and the Dodge Ram. GM is developing an in-house 4.5-liter V8; Ford, an in-house 4.4-liter V8 derived from a European diesel and Chrysler said it would collaborate with longstanding diesel-engine partner Cummins Inc. to produce a V6 diesel.
(Read more...)
Posted by Michelle Krebs at 4:53 AM under Chrysler , Companies , Ford , GM , Technology | Comments (1) | digg this | del.icio.us
GM, Chrysler Expand Partnerships With Credit Unions
By Dale Buss
Encouraged by their initial exposure to an uncommonly creditworthy bunch of customers, General Motors and Chrysler have expanded regional test programs of discounts for credit union members into nationwide campaigns.
Both of the troubled automakers have announced their participation in a program they're calling Invest in America, encompassing nearly 8,000 credit unions nationwide who have nearly 90 million members.
(Read more...)
Posted by Michelle Krebs at 8:12 AM under Business , Chrysler , GM | Comments (1) | digg this | del.icio.us
Sales Aren't the Only Thing Detroit Lost in 2008
By Bill Visnic
Nearly 3 million U.S. auto sales evaporated in 2008, and plenty of that blood was lost by the Detroit Three: General Motors Corp. sales were down 23 percent, Ford Motor Co. sales slid by 20 percent and Chrysler LLC sales dropped by 30 percent.
Total U.S. sales plunged from 16.1 million units in 2007 to 13.2 million for 2008. Equally interesting -- and troubling, for Detroit -- was that not only did the pie get painfully smaller, the domestic automakers' portion, market share, once again lost ground.
According to data from Edmunds.com, the Detroit Three lost a collective total of 3.7 points of market share in 2008. Chrysler led the group, ceding 1.9 points of share (from 12.9 percent of the market in 2007 to 11 percent in 2008). GM lost 1.4 percent (from 23.8 percent in 2007 to 22.4 percent). Ford gave back 0.4 points of share (from 15.5 percent to 15.1 percent for 2008).
(Read more...)
Posted by Michelle Krebs at 6:44 AM under Analysis , Chrysler , Companies , Featured , Ford , GM , Toyota | Comments (1) | digg this | del.icio.us
Automakers Seek Game-Changers in Fresh TV Ad Campaigns
By Dale Buss
Striking every attitude from empathy to ambivalence to something resembling snarkiness, automakers have been using new TV-advertising campaigns to try to jolt consumers off their couches and into dealer showrooms.
The headwinds are daunting, but automakers have been launching a greater variety of messages than at any time in recent memory - attempting to find something, anything that punches effectively through the pervasive gloom in American households and reignites their desire and confidence to make a major purchase.
(Read more...)
Posted by Michelle Krebs at 4:44 AM under Analysis , Chrysler , Companies , Featured , Ford , GM , Toyota | Comments (0) | digg this | del.icio.us
2008 U.S. Auto Sales Are Worst Since 1992
By Michelle Krebs and Bill Visnic
U.S. auto sales continued their precipitous tumble in December, closing the books on the industry's worst year since 1992.
Five of the Big Six automakers -- General Motors, Ford, Toyota, Nissan and Honda -- saw sales slide another 30 percent each in December; Chrysler's plummeted 53 percent. No automaker showed higher sales December to December. The lucky ones saw mere single-digit dips.
For the full year of 2008, all of the Big Six automakers reported sales declines. In total, the industry sold 13.2 million vehicles for an 18 percent drop from 2007's 16.1 million.
"It was an unbelievable year -- not one I want to repeat," said Mark LaNeve, GM's head of sales and marketing in a conference call with reporters. "Hopefully, 2009 will improve from December's low point rather than deteriorate as 2008 did."
(Read more...)
Posted by Michelle Krebs at 5:22 PM under Analysis , Chrysler , Companies , Featured , Ford , GM , Toyota | Comments (3) | digg this | del.icio.us
December Incentives Set Record, Edmunds.com Estimates
By Michelle Krebs
SANTA MONICA, Calif. -- Automaker incentives set a new record in December, Edmunds.com estimates, and, surprisingly, leasing showed a remarkable jump despite reports of its demise.
"Never before has the December average incentive been this high," said Jesse Toprak, Edmunds.com's executive director of Industry Analysis. "Automakers have been pulling out all the stops to keep motivating shoppers during these tough times."
Slowing sales have struck virtually every automaker and every market segment. U.S. auto industry sales for December and the full-year of 2008 are being reported Monday. December sales are expected to look a lot like the dismal levels of October and November -- and down from in the neighborhood of 30 percent or more from December 2007. Full-year sales are likely to be the worst since 1992.
(Read more...)
Posted by Michelle Krebs at 6:36 AM under Analysis , Chrysler , Companies , Featured , Ford , GM , Toyota | Comments (2) | digg this | del.icio.us
Chrysler's 'Thank You' Ads: Not the Best Idea
By Bill Visnic
Readers of the nation's major newspapers -- those still reading paper, anyway -- by now have seen splashy full-page ads from Chrysler LLC thanking "America" for its bailout-investment in the company.
No harm in being contrite, but just like winging into Washington, D.C., on a trio of exec jets to demonstrate their dire financial straits, the "Thank You, America" ad isn't going to go down as one of Detroit, Inc.'s more wizened PR stunts.
(Read more...)
Posted by Michelle Krebs at 9:34 AM under Chrysler , Commentary , In the Media | Comments (2) | digg this | del.icio.us
Billionaire Kerkorian Sells Last of Ford Stock
By Michelle Krebs
Perhaps now, at age 91, Las Vegas billionaire Kirk Kerkorian has finally given up on the auto industry that has not been particularly good to him.
On Tuesday -- just in time to take year-end losses -- Kerkorian sold the last of his investment in Ford. The move came just six months after Kerkorian's Tracinda Corp. bought a 6.49 stake in Ford and carries with it deep losses. Kerkorian's purchase was seen as a vote of confidence in Ford's turnaround strategy and its management led by former Boeing exec Alan Mulally.
(Read more...)
Posted by Michelle Krebs at 6:33 AM under Business , Chrysler , Companies , Ford , GM , News , Personalities | Comments (1) | digg this | del.icio.us
GMAC Wins Bid To Become Holding Company
GMAC LLC, the finance arm of General Motors Corp. that also lends money for home mortgages and lines of credit, on Decemcber 24 was granted status as a bank holding company by the U.S. Federal Reserve.
The move was vital for GMAC in order for it to qualify for relief loans from the storied Troubled Assets Relief Program (TARP), passed in October to provide emergency loans to distressed banks and other financial institutions.
(Read more...)
Posted by Bill Visnic at 9:33 PM under Business , Chrysler , GM , News | Comments (0) | digg this | del.icio.us
It May Not Be Bankruptcy, but Chrysler Deconstruction Inevitable
By Bill Visnic
President George W. Bush finally released the crucial billions needed to keep General Motors Corp. and Chrysler LLC around to see the new year, but with the real work just beginning, the wrenching save-Detroit soap opera seems to be grinding towards just one certainty: Chrysler LLC isn't going to make it.
If the maneuverings of the past several weeks haven't twisted the automotive Rubik's Cube enough for everyone to see the inevitable outcome, the reality is telegraphed loud and clear in the White House's "bailout" numbers: GM will bask in the holiday glow of $4 billion on Dec. 29, another $5.4 billion barely two weeks later and an additional $4 billion in February, for a total of $13.4 billion.
Chrysler gets $4 billion on Dec. 29. That's it.
(Read more...)
Posted by Michelle Krebs at 3:39 AM under Analysis , Chrysler , Commentary , Featured | Comments (3) | digg this | del.icio.us
Cerberus Gives Auto Equity to Labor, Creditors
Private-equity firm Cerberus Capital Management that owns Chrysler plans to hand over equity in the company's automotive operations to labor and creditors as part of its loan agreement with the U.S. government, Bloomberg News reports.
"Cerberus believes that concessions by all relevant constituencies will be required to facilitate a full restructuring and recapitalization of Chrysler," the New York-based firm said in an e-mailed statement Friday. The Chrysler investment is the largest in the firm's history.
(Read more...)
Posted by Michelle Krebs at 9:26 AM under Business , Chrysler | Comments (2) | digg this | del.icio.us
Chrysler Announces Executive Departures
By Michelle Krebs
Two of the highest profile hires made by Chrysler following its purchase by private equity firm Cerberus Capital Management are leaving the company.
Philip F. Murtaugh, who headed Chrysler's Asia-Pacific operations, and Deborah Meyer, Chrysler's chief marketing officer, are gone, Chrysler announced just moments after President George W. Bush said Chrysler and General Motors would receive $17.4 billion in government loans.
The hiring of Murtaugh and Meyer, along with Vice Chairman Jim Press, were hailed as coups by Chrysler when they occurred just 18 months ago.
(Read more...)
Posted by Michelle Krebs at 6:45 AM under Business , Chrysler , News , Personalities | Comments (1) | digg this | del.icio.us
GM, Chrysler Receive $13.4 Billion in Immediate Federal Loans
By Michelle Krebs
The Bush administration announced Friday morning that it will provide $13.4 billion in short-term loans to General Motors and Chrysler; the automakers will receive another $4 billion in February.
President George Bush admitted reluctance about providing government loans to the Detroit automakers but noted the beleagured U.S. economy would suffer a harsh blow if one or more of Detroit's automakers collapsed into a "disorderly bankruptcy" at this time.
"These are not ordinary circumstances," Bush said. "In the midst of a financial crisis and a recession, allowing the U.S. auto industry to collapse is not a responsible course of action."
(Read more...)
Posted by Michelle Krebs at 5:18 AM under Chrysler , Featured , GM , News | Comments (2) | digg this | del.icio.us
December Sales Rate Will Be Year's Lowest, Edmunds.com Forecasts
SANTA MONICA, Calif. -- The deteriorating economy, the precarious employment situation and the lack of available credit will push the annual sales rate in December for U.S. car sales to their lowest level of the year below 10 million units, Edmunds.com forecasts.
December sales (retail and fleet) are expected to total 852,000 units, a 38.4 percent decrease from December 2007 but a 14.6 percent increase from November, Edmunds.com predicts. Typically, December sales are about 18 percent higher than November's.
With the year closing on a low note, U.S. vehicle sales for all of 2008 will total just over 13 million, a decrease of almost 3 million vehicles, or 18 percent, from 2007. Automakers report December and 2008 sales figures January 5, 2009.
(Read more...)
Posted by Michelle Krebs at 5:28 PM under Analysis , Chrysler , Companies , Featured , Ford , GM , Toyota | Comments (3) | digg this | del.icio.us
GM Denies Chrysler Linkup Talks, Auto Stocks Tumble
By Bill Visnic
A day after Chrysler LLC announced it is suspending operations for at least a month at all of its North American assembly plants, General Motors Corp. is denying a Wall Street Journal report saying the two companies resumed merger talks.
Chrysler and GM are awaiting word from the Bush Administration regarding promised emergency funding to carry the automakers into early 2009. Without a loan of billions, both companies have said they may not have sufficient liquidity to continue funding daily operations.
Separate from Chrysler's drastic move to curtail all manufacturing, GM already had announced a major production cutback for the first quarter of 2009 and is delaying other manufacturing spending, including the construction of a plant to build the engine for the high-profile Volt extended-range electric vehicle.
(Read more...)
Posted by Bill Visnic at 10:59 AM under Business , Chrysler , Companies , Ford , GM | Comments (0) | digg this | del.icio.us
Finalists Announced for 2009 North American Car and Truck of the Year Awards
DETROIT - Finalists for the 2009 North American Car and Truck of the Year awards were announced Thursday at the Detroit Economic Club's annual auto show luncheon.
The finalists for the 2009 North American Car of the Year honors are the Ford Flex, Hyundai Genesis and Volkswagen Jetta TDI. Finalists for the 2009 North American Truck of the Year award are the Dodge Ram, Ford F-150 and the Mercedes-Benz ML320 BlueTEC.
(Read more...)
Posted by Michelle Krebs at 4:25 PM under Chrysler , Ford | Comments (0) | digg this | del.icio.us
Chrysler Shuttters Manufacturing Plants for at Least a Month
Chrysler will close all 30 of its plants for at least a month beginning at the end of the work
day Friday, in an effort to keep inventories of unsold vehicles from building due to slumping sales and to conserve cash. The automaker said workers will be called back January 19 at the earliest.
The company said it is closing plants for an extended holiday to keep inventories from building due to poor sales. "The continued lack of consumer credit for the American car buyer and the resulting dramatic impact it has had on overall industry sales" forced the action, Chrysler said in a statement.
(Read more...)
Posted by Michelle Krebs at 2:53 PM under Business , Chrysler , News | Comments (0) | digg this | del.icio.us
Auto Bailout Not Ready, President Bush Says
President George W. Bush said Monday an announcement on an auto industry rescue was not imminent, leaving the Detroit Three's fate clouded in uncertainty for a little longer, Reuters news service reports.
"We're not quite ready to announce that yet," Bush told reporters on Air Force One during a flight from Baghdad on an unannounced visit to Afghanistan.
(Read more...)
Posted by Michelle Krebs at 7:30 AM under Business , Chrysler , Companies , Ford , GM | Comments (0) | digg this | del.icio.us
White House May Come to Automakers' Rescue
By Michelle Krebs
The U.S. Treasury said it is willing to provide financing to Detroit automakers after the Senate Thursday night failed to approve $14 billion in loans to General Motors and Chrysler.
"Because Congress failed to act, we will stand ready to prevent an imminent failure until Congress reconvenes and acts to address the long-term viability of the industry," Treasury spokeswoman Brookly McLaughlin said in an e-mailed statement.
(Read more...)
Posted by Michelle Krebs at 6:36 AM under Analysis , Chrysler , Featured , Ford , GM | Comments (0) | digg this | del.icio.us
Remember Katrina, Senators
Detroit Free Press columnist Tom Walsh reminds senators from the Gulf States, many of
whom oppose the loans to Detroit automakers, to recall Hurricane Katrina as they cast their votes on the bailout bill tonight.
"When Hurricane Katrina slammed into Louisiana and Alabama on Aug. 29, 2005, the automobile companies of Detroit did not harrumph that the Gulf Coast should have been better prepared. They didn't sit back and wait for New Orleans to submit a detailed plan for future repair of the ruptured levees," Walsh wrote in Thursday's edition.
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Posted by Michelle Krebs at 4:51 PM under Chrysler , Commentary , Ford , GM , In the Media | Comments (5) | digg this | del.icio.us
Big Three Bailout Rejected; GM Hires Bankruptcy Advisers, Report Says
By Michelle Krebs
The U.S. Senate rejected legislation that would have provided $14 billion in federal loans to keep afloat General Motors and Chrysler, which say they will be out of money by the end of the year.
At the same time, GM reportedly has hired lawyers and bankers to consider whether to file for Chapter 11 bankruptcy. Those advisers are among the best known in the bankruptcy and restructuring business who would handle what would be one of the largest bankruptcy filings in U.S. history.
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Posted by Michelle Krebs at 4:34 PM under Chrysler , Companies , Featured , Ford , GM | Comments (0) | digg this | del.icio.us
Former Fed Chairman Volcker Favored as Car Czar
Former Federal Reserve Chairman Paul Volcker looks to have the inside track for the newly
created post of car czar, if the federal loans for Detroit automakers is approved by the Senate today -- an approval that is in doubt.
Nevertheless, the Bush White House reportedly is coordinating with the incoming Obama administration in choosing a new "car czar" to oversee the auto company restructurings required under the loan legislation passed by the House Wednesday night. Volcker appears to be acceptable to both sides.
The 81-year-old Volcker has been an important economic adviser to President-elect Obama and on November 26 was named head of Obama's Economic Recovery Advisory Board. Volcker has the added benefit of automotive bailout experience -- he was Federal Reserve Board chairman and a principal government participant in the Chrysler bailout. He and the oversight board played a key role in winning concessions from the United Auto Workers union and from Chrysler's banks..
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Posted by Michelle Krebs at 7:47 AM under Chrysler , Companies , GM , Personalities | Comments (0) | digg this | del.icio.us
Withering Economy Already Endangers Bailout-Plan Assumptions, Expectations
By Bill Visnic
In their bailout blueprints presented to Congress last week, automakers presented forward-revenue assumptions based on forecasts for 2009 auto sales. In General Motors Corp.'s case, for example, it projected "downside," "baseline" and "upside" sales forecasts for the U.S. market, correlating how much funding the company believes it will need based on each sales scenario.
If a new survey of the nation's economists has any relevance, the beleaguered automakers had better strap in for a bumpy ride that may make a reality of those "downside" assumptions.
Bloomberg News' December survey of economists released this week paints a bleak outlook for 2009. The prominent economists comprising the survey sample predict consumer spending will plunge by a rate not seen since the 1940s, with household spending retreating by 1 percent, which also hasn't happened since World War II.
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Posted by Michelle Krebs at 4:13 AM under Analysis , Chrysler , Featured , Ford , GM | Comments (1) | digg this | del.icio.us
GM, Credit Unions Already Planning To Expand Partnership
By Dale Buss
Both General Motors and the Credit Union National Association would like to expand a just-announced pilot partnership that provides a 4 to 5 percent purchase-price discount to members of nearly 1,300 credit unions who buy GM vehicles in four Midwestern states.
After the June 30 wrap-up of the program launch, GM would like to roll it out to other regions or nationwide, Mark LaNeve, the company's North American vice president of sales, said today. And a credit-union executive invited Ford and Chrysler to consider their own versions of a test program that aims to bring some of America's most creditworthy middle-income consumers into GM dealer showrooms.
With the deal that began this week, GM is seeking broader access for its customers to one of the few reliable pools of auto-financing funds, especially because the company's finance arm, GMAC, is making practically no new loans these days.
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Posted by Michelle Krebs at 11:03 AM under Business , Chrysler , Companies , Ford , GM | Comments (0) | digg this | del.icio.us
Chrysler Almost Didn't Introduce Minivans Under Federal Loan Board
Chrysler's minivans - at the time innovative vehicles credited with the automaker's survival in
the 1980s - almost failed to come into being, recalled a former Chrysler executive.
Thomas Stallkamp, a former executive of Ford and then Chrysler during its financial troubles, told Bloomberg News that in the 1980s, the loan board overseeing Chrysler as it borrowed federal funds to survive tried to veto models such as the minivans.
Stallkamp told Bloomberg a lesson should be learned from Chrysler's experience as the federal government now contemplates the role of an overseeing entity for General Motors and Chrysler, if they receive the government loans they have requested.
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Posted by Michelle Krebs at 9:44 AM under Business , Chrysler | Comments (1) | digg this | del.icio.us
Automaker Bailout Vote Could Start Today
By Michelle Krebs
The House of Representatives could vote as early as today on the $15-billion loan package for U.S. automakers after the Congressional Democrats and the White House reached an agreement in principle on Tuesday night.
If the legislation now being crafted is passed, the low-interest loans could make their way to General Motors and Chrysler by next week. The automakers have said they could run out of money before the year ends. The $15 billion in loans is intended to keep them afloat through March. Ford has said it doesn't need loans now but would like access to a line of credit if the economy worsens more than the automaker expects.
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Posted by Michelle Krebs at 6:09 AM under Chrysler , Companies , Featured , Ford , GM , News | Comments (0) | digg this | del.icio.us
NYT Columnist: Detroit Aid Should Hinge on Hybridizing Everything
By Bill Visnic
With a pending vote Congressional vote on a bailout package to extend so-called "bridge loans" to Chrysler LLC, Ford Motor Co. and General Motors Corp. by perhaps as soon as this week, New York Times
columnist Thomas L. Friedman -- often prominent for his provocative views on the auto industry -- is calling for one unique "string" to be attached to federal bailout funds: forcing the domestic automakers to present plans to hybridize their entire model ranges in three years.
Friedman has been a vocal advocate for hybrid-electric technology and has been criticized for a view of the industry that typically is unkind to the Detroit auto-industry establishment. Friedman often argues in favor of the management style and operational practices of Detroit's chief competitors, the Japan-based automakers -- and caused fireworks when he once suggested GM should go out of business and let Toyota assume GM's longstanding role.
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Posted by Michelle Krebs at 1:32 PM under Business , Chrysler , Commentary , Companies , Ford , GM , In the Media , Toyota | Comments (8) | digg this | del.icio.us
Bill on Aid for Detroit Automakers Near; Congress Could Vote on Tuesday
By Bill Visnic
As the numbers on the U.S. economy worsen, resistance to federal assistance for the struggling Detroit Three automakers dissipates, with reports from Washington, D.C., saying Congress could vote on a hastily crafted bailout package as early as Tuesday.
White House spokesperson Dana Perito told reporters today it appears the Bush administration and congressional leaders, squabbling mostly about from where "bridge loan" funds would be appropriated, have to come to agreement, although Congressional Democrats need to construct a bill.
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Posted by Michelle Krebs at 11:58 AM under Chrysler , Companies , Ford , GM | Comments (0) | digg this | del.icio.us
Consumers Reluctant To Buy From Bankrupt Automaker, Survey Confirms
Results released from a survey conducted by CNBC and Portfolio.com confirmed what the heads of Detroit's auto companies testified to in Congressional hearings the last months: Consumers are reluctant to buy a car from an automaker in bankruptcy.
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Posted by Michelle Krebs at 8:28 AM under Analysis , Chrysler , Companies , Ford , GM | Comments (0) | digg this | del.icio.us
Automakers' Bankruptcy Would Cost Taxpayers Four Times More Than Bailout, Study Finds
By Michelle Krebs
A bankruptcy filing by General Motors and Chrysler would cost U.S. taxpayers four times more than the amount of federal bridge loans being considered this week by Congress, a new study finds.
A bankruptcy, or even a prepackaged restructuring outside of bankruptcy court, cannot control a wild card unique to automakers -- the car-buying consumer -- noted a joint study by international consulting firm BBK and Michigan-based Anderson Economic Group.
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Posted by Michelle Krebs at 7:37 AM under Analysis , Chrysler , Companies , Featured , Ford , GM | Comments (1) | digg this | del.icio.us
7 Myths About Detroit Automakers, Detroit Free Press
The debate over aid to the Detroit-based automakers is awash with half-truths and misrepresentations that are endlessly repeated by everyone from members of Congress to journalists. Here are seven myths about the companies and their vehicles, and the reality in each case.
This column by Detroit Free Press auto critic Mark Phelan originally was published on November 17 and was updated last Friday to debunk the myths as Congress was about to fashion an automotive rescue package.
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Posted by Michelle Krebs at 5:33 AM under Analysis , Chrysler , Commentary , Ford , GM , Technology , Toyota | Comments (1) | digg this | del.icio.us
Saving Detroit Three Is in the Country's National Interest, Experts Agree
By Michelle Krebs
The most dramatic and convincing moment of five-and-a-half hours of Congressional testimony on Detroit automakers' request for financial help came when Texas Democrat Al Green asked the panel of esteemed financial and industry experts simple, straightforward questions. Requesting them to raise their hands like third-graders if their answer was yes, he asked:
Was bailing out AIG in the national interest?
All six hands went up.
Is it in the national interest to bailout the Detroit automakers?
All hands shot up.
Would it be damaging to the national interest not to take action to help Detroit's automakers?
All hands went up.
"Then we must act. It is in our national interest," Green concluded.
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Posted by Michelle Krebs at 12:09 PM under Chrysler , Companies , Featured , Ford , GM , News | Comments (3) | digg this | del.icio.us
Chrysler Hires a Bankruptcy Firm, Report Says
Chrysler LLC has hired the prominent law firm Jones Day as bankruptcy counsel, several unnamed people apparently familiar with the matter told the Wall Street Journal. The firm was hired several weeks ago to help the ailing auto maker prepare for a possible Chapter 11 bankruptcy filing.
Neither Jones Day nor Chrysler commented to the Journal about the report.
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Posted by Michelle Krebs at 10:35 AM under Chrysler , News | Comments (0) | digg this | del.icio.us
Canada Considers Financial Help for Big Three
The Canadian government will begin reviewing financial-aid requests this weekend for General Motors, Ford Motor Co. and Chrysler LLC. The automakers had a Friday deadline to submit detailed proposals for their Canadian businesses.
"We want to see long-term plans, and management has to be overseen if taxpayer money is involved," Industry Minister Tony Clement told Bloomberg News Thursday. The government will look at "various options" for help from this year's budget, Clement said.
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Posted by Michelle Krebs at 7:28 AM under Chrysler , Companies , Ford , GM | Comments (0) | digg this | del.icio.us
Big Three CEOs Head to the House to Plea Again for Financial Help
By Bill Visnic
It's still anybody's guess, but Congress seems to be warming somewhat to the idea of helping Detroit's automakers, if for no other reason than to keep the entire U.S. economy from collapsing on their watch.
On Friday, Detroit's auto chiefs were headed to Capitol Hill to testify again before the House Financial Services Committee. On Thursday, they were before the Senate Banking, Housing and Urban Affairs Committee for nearly six hours.
At the opening of Thursday's session, the potential for the Detroit Three automakers' proposed bridge-loan package of as much as $34 billion appeared to be steering towards the much-discussed - and much-dissed by the automakers - "pre-packaged bankruptcy" option.
But as the testimony wore on, the case against bankruptcy gathered a palpable momentum, and it now seems likely Congress will broker some kind of immediate funding General Motors Corp. and Chrysler LLC say they must have to survive to see 2009.
The real question now seems to be from where, how, and how quickly the help will come. GM CEO Rick Wagoner and Chrysler CEO Robert Nardelli were unabashed in reiterating their companies' need at least $4 billion each - by the end of the month.
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Posted by Michelle Krebs at 6:02 PM under Chrysler , Companies , Featured , Ford , GM | Comments (2) | digg this | del.icio.us
UAW Agrees to Contract Talks, VEBA Payment Delay
By Michelle Krebs
DETROIT -- The leadership of the United Auto Workers (UAW) union, meeting in an emergency session here Wednesday, said it will negotiate with General Motors, Ford and Chrysler to modify its current contract as part of the Big Three's plea to Congress for bridge loans.
UAW President Ron Gettelfinger said the union leadership also agreed to delay the Detroit three's payments to the Voluntary Employee Benefit Association (VEBA), which shifts retiree health care benefits for union members from the auto companies' books to a union-administrated fund.
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Posted by Michelle Krebs at 9:50 AM under Chrysler , Ford , GM | Comments (1) | digg this | del.icio.us
Chrysler Needs $7 Billion -- Now
By Michelle Krebs
In keeping with its status as a private company, Chrysler submitted its viability plan that didn't provide nearly the detail that General Motors and Ford did in their hefty reports.
However, Chrysler's simple message came through loud and clear: the automaker is nearly broke and needs a government loan -- and needs it now. The automaker wants a $7-billion government loan by December 31. Otherwise, its liquidity could fall below the necessary levels to run the company through the first quarter.
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Posted by Michelle Krebs at 4:23 PM under Chrysler , News | Comments (0) | digg this | del.icio.us
Funereal November Sales Provide More Ammo for Bailout Plea
By Dale Buss
In case members of Congress needed any more reminding why the domestic automakers are hat-in-hand before them this week, the 37 percent drop in November sales has provided them with the latest bleak snapshot of a moribund U.S. vehicle market.
As the Detroit Three were presenting their restructuring plans in Washington, D.C., on Tuesday, the sales data rolling in from them and all other OEMs gave further dimension to the vast pall that has come over the nation's automotive market and quantified the paralyzing dread that is felt by American consumers.
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Posted by Michelle Krebs at 3:35 PM under Analysis , Chrysler , Featured , Ford , GM , Toyota | Comments (0) | digg this | del.icio.us
Turns Out, $25 Billion Is Not Enough After All
As Congressman and industry experts suspected, the $25 billion in bridge loans Detroit's three automakers requested of the federal government is not enough.
In their viability reports submitted to Congress Tuesday, the three auto companies have requested a combined $34 billion.
General Motors wants up to $12 billion in loans in various installments to help it through 2009. GM also requested a $6 billion line of credit in case the economy gets worse. Ford is asking for a line of credit of $9 billion that it may not tap into but wants as a security blanket in case the recession extends well into 2009. And Chrysler wants $7 billion -- by Dec. 31.
Posted by Michelle Krebs at 2:13 PM under Business , Chrysler , Ford , GM | Comments (2) | digg this | del.icio.us
Domestic Automakers Ease Off Incentives While Imports Rev Them Up in Pursuit of Market Share, Edmunds.com Reports
SANTA MONICA, Calif. -- Domestic automakers eased off the incentive gas in November while import automakers revved up incentives, according to Edmunds.com.
"All three domestic automakers lowered their incentive spending this month, seeking to preserve cash during these incredibly tough times," said Jesse Toprak, Edmunds.com's executive director of Industry Analysis. "Meanwhile, the imports have poured more money into incentives, attempting to seize the opportunity to gain market share. Toyota's monthly incentives spend hit a new record high in November, and the company's market share might follow suit."
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Posted by Michelle Krebs at 10:00 AM under Analysis , Chrysler , Companies , Ford , GM , Toyota | Comments (0) | digg this | del.icio.us
Ford, Rivals Stress New Parsimony to Congress
By Bill Visnic
Scrambling to enlist the aid of the federal government in surviving the nation's drastic economic downturn, Ford Motor Co., General Motors Corp. and Chrysler LLC are submitting today their restructuring "blueprints" that will have at least one element in common: symbolic pay cuts for their chief executive officers and pledges to accelerate the introduction of higher-efficiency models and technologies.
Ford CEO Alan Mulally will work for $1 per year, Ford announced, and it is believed GM CEO Rick Wagoner will do the same when his company releases details of the company's plan later today. Chrysler CEO Robert Nardelli already had offered to work for $1.
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Posted by Michelle Krebs at 9:47 AM under Chrysler , Companies , Featured , Ford , GM , Personalities , Technology | Comments (0) | digg this | del.icio.us
Potential for Swedish Intervention with Saab, Volvo Intensifies
By Bill Visnic
With Chrysler LLC, Ford Motor Co. and General Motors Corp. set to return to Washington,
DC tomorrow to present Congress with a detailed plan for restructuring their operations under terms of a desired federal bridge-loan package, reports from Europe indicate the Swedish government may be considering an active role in assuring the continued future of Saab Cars and Volvo Car Corp., owned by GM and Ford,
respectively.
And Ford confirmed Monday it is exploring the possibility of selling Volvo - despite assertions
earlier this year the company did not want to part with its Swedish division - saying in a press release the company "will re-evaluate strategic options for Volvo Car Corporation, including the possible sale of the Sweden-based premium automaker."
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Posted by Michelle Krebs at 12:07 PM under Business , Chrysler , Companies , Featured , Ford , GM | Comments (0) | digg this | del.icio.us
Detroit Three: Making the Sales Pitch of a Lifetime
By Michelle Krebs
The Detroit Three are putting the finishing touches and obtaining the blessings of their boards and upper management for the biggest sales pitch of their lives this week. They are preparing the viability plans due to Congress on Tuesday in order to obtain the $25 billion in bridge loans they are seeking.
Executives from General Motors, Ford and Chrysler worked through the Thanksgiving holiday putting together plans after Congressmen criticized them for lacking such plans in the last round of hearings. While each company's plan is individual to their unique circumstances, all are expected to detail even deeper cuts, including executive compensation and perks, than have already been made and an acceleration of environmental and fuel-saving initiatives. Their plans also are expected to include even more concessions from the United Auto Workers (UAW) union.
Meantime, the Detroit Three's plea for help is likely to get a boost from the continued deterioration of auto sales in the U.S., where automakers report November results Tuesday. Sales are expected to hit 25-year lows. That sales slide is spreading globally with a number of markets reporting dismal sales on Monday.
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Posted by Michelle Krebs at 6:04 AM under Chrysler , Companies , Featured , Ford , GM , Technology | Comments (0) | digg this | del.icio.us
OK, Who Can Resist a Good Bailout Joke?
Detroit's Big Three automakers are jousting with the U.S. Congress for their continued existence, and nobody denies that's serious business.
But as usual, what got the auto companies to this place has opened Detroit Inc. to plenty of ridicule -- and not all of it is mean-spirited.
Laughter may or may not be the best medicine for this predicament. Either way, here are a few examples of our favorite "bailout humor" that hit the national stage:
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Posted by Bill Visnic at 3:15 AM under Business , Chrysler , Companies , Ford , GM , In the Media | Comments (1) | digg this | del.icio.us
GM, Tiger Woods Part Ways
General Motors and golfing great Tiger Woods announced Monday they were parting ways.
GM's longtime deal with Woods, who served as spokesman for Buick for the past nine years, ends December 31.
For GM, it is a cost-cutting move as it struggles to survive. GM reportedly paid Woods $8 million a year for the endorsement. Woods claims he wants more personal time since he and his wife are expecting a second child in late winter.
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Posted by Michelle Krebs at 11:15 AM under Business , Chrysler , Ford , GM , Personalities | Comments (1) | digg this | del.icio.us
Gas Prices and Heavy Incentives Keep Car Sales From Sinking Below October's Depths
SANTA MONICA, Calif. -- November car sales improved over October's historic lows thanks to lower gas prices and high incentives.
November new vehicle sales, including fleet and retail sales, are expected to be 850,000 units, a 27.6 percent decrease from November 2007 but showing a 1.9- percent increase from last month, according to Edmunds.com's forecast.
Still, the Seasonally Adjusted Annual Rate (SAAR) for the month is expected to be only about 11.5 million units.
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Posted by Michelle Krebs at 10:45 AM under Analysis , Chrysler , Companies , Featured , Ford , GM , Toyota | Comments (0) | digg this | del.icio.us
Automakers Want Help Selling Cars Via Loan Availability
Detroit Three automakers plan to return to Washington to make their second pitch for federal bridge loans next week and will also ask Washington to help them sell more cars by making car loans more available.
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Posted by Michelle Krebs at 7:07 AM under Business , Chrysler , Companies , Ford , GM | Comments (1) | digg this | del.icio.us
Sounding the Alarm for Ailing Automotive Suppliers
Carmakers around the globe are raising the alarm about the declining health of auto suppliers, whose problems they fear could ricochet back to hurt them.
Many suppliers that make parts for General Motors, Ford and Chrysler also supply their foreign-owned plants operating in North America and elsewhere. Rating agencies are warning about tightening credit conditions, falling orders, and the possible failure of a Detroit carmaker, which could bankrupt some auto suppliers and in turn hurt even relatively healthy carmakers' businesses, the Financial Times reported.
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Posted by Michelle Krebs at 6:22 AM under Business , Chrysler , Companies , Ford , GM | Comments (0) | digg this | del.icio.us
Tracking the Bailout: When the Music Stops, Who's Going Bankrupt?
By Bill Visnic
The CEOs of Ford Motor Co., General Motors Corp. and Chrysler LLC loaded up on their much-maligned corporate jets and winged out of Washington, DC, this week with no bailout money -- but the assurance of a shaky holiday season.
After Democratic deal-makers conceded this week there would not be sufficient bipartisan support to approve a bill to "repurpose" the existing and already approved $25-billion Department of Energy loan (originally intended to promote the development of fuel-efficient technology and retool factories), the initiative was shelved until a possible vote on December 8.
That promises to be a rocky 17 days for GM and Chrysler, whose bosses insinuate the companies may not have the funds to enable them to see the New Year.
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Posted by Michelle Krebs at 4:25 AM under Chrysler , Commentary , Companies , Featured , Ford , GM | Comments (3) | digg this | del.icio.us
Automaker Rescue Package Dead for Now
By Michelle Krebs
WASHINGTON -- A bipartisan plan to provide Detroit automakers and suppliers with bridge loans using the already appropriated $25 billion to retool to more fuel-efficient vehicles came and went in a matter of hours Thursday.
Democratic Congressional leaders, realizing they did not have the votes to pass the plan that was presented around noon Thursday, announced less than three hours later that they would not put it to a vote this week.
Instead, they are requiring automakers applying for the loans to submit a plan of financial viability with an explanation of how the loans will help them transform their business by December 2. Congress may then reconvene for a possible vote on December 8.
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Posted by Michelle Krebs at 11:56 AM under Chrysler , Companies , Featured , Ford , GM | Comments (1) | digg this | del.icio.us
Chance of GM, Chrysler Bankruptcy 75 Percent Without Loans, Says IHS Global Insight
The odds of General Motors and Chrysler filing bankruptcy in early 2009 soars to 75 percent without a government rescue package, predicts forecasting firm IHS Global Insight. With federal loans, the odds drop to 25 percent.
"Without a loan package, the probability of both GM and Chrysler going bankrupt in early 2009 is about 75 percent -- almost a certain probability," George Magliano, IHS Global Insight's director of North America, said in a Webcast on the economy and auto industry Thursday morning.
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Posted by Michelle Krebs at 8:17 AM under Analysis , Chrysler , Featured , GM | Comments (4) | digg this | del.icio.us
Caution Flag Waves Over Los Angeles Auto Show
By Danny King
LOS ANGELES -- With its exhibit set in its own small wing of the Los Angeles Convention Center away from other automakers, its mix of new blindingly fast models with its classic roadsters, its trays of hors d'oeuvres for visitors and a visit from comedian and noted enthusiast Jerry Seinfeld, Porsche would appear to be the last carmaker to show the effects of a slumping auto industry at the Los Angeles auto show.
Don't be fooled, says the company's head of U.S. operations. The slowdown is not lost on him.
"I would be very happy if I could say this doesn't affect us or affects us differently from every other car manufacturers, but we all have the same problem," said Detlev von Platen, chief executive officer of Porsche Cars North America, Wednesday. "At the moment, we cannot count on the confidence of the consumers."
On a day when U.S. senators couldn't agree on whether or how to extend $25 billion worth of loans to help General Motors, Ford and Chrysler survive, the overriding mood during the first day of the Los Angeles auto show's exhibits for members of the press was one of restraint.
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Posted by Michelle Krebs at 5:15 AM under Analysis , Chrysler , Companies , Featured , Ford | Comments (0) | digg this | del.icio.us
Mitt Romney: Let Detroit Go Bankrupt
By Michelle Krebs
Detroit-born Mitt Romney, a candidate for this year's Republican presidential nomination and whose father was Michigan governor and an auto company executive, advocates letting Detroit automakers go bankrupt.
In an OpEd piece carried in Wednesday's edition of The New York Times, Romney, who is expected to make another presidential run in 2012, wrote: "Detroit needs a turnaround not a check." He suggested the turnaround path is through a managed bankruptcy.
What a difference a failed presidential run makes! Romney won the Michigan Republican primary against the eventual presidential candidate John McCain by being a booster for Detroit's auto industry.
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Posted by Michelle Krebs at 9:42 AM under Chrysler , Commentary , Personalities | Comments (2) | digg this | del.icio.us
Chrysler's Nardelli: Running Out of Cash
Chrysler Chairman and CEO Bob Nardelli told Congressmen in the past couple of days
that the automaker is rapidly running out of cash due to the economic downturn and has explored all bankruptcy and bankruptcy-like options, deeming them unworkable. As a last resort, Chrysler has joined General Motors and Ford in seeking $25 billion in bridge loans from the U.S. government.
Here is Nardelli's opening statement to a U.S. Senate committee on Tuesday and a House Committee on Wednesday holding hearings on the bridge loans:
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Posted by Michelle Krebs at 7:24 AM under Chrysler , Commentary | Comments (0) | digg this | del.icio.us
Outlook for Automaker Loans Fragile as Senate Hammers Detroit Chiefs
By Bill Visnic and Michelle Krebs
Chief executives from each of the Detroit Three automakers couldn't
have come to Tuesday's session of the U.S. Senate Banking, Housing and Urban Affairs Committee at a less-receptive time. Seeking $25 billion in emergency loans to keep their ailing operations afloat, they might as well have been kids who've gorged on all their Halloween candy and now are whining for more.
Although the committee is chaired by a receptive persona in Senator Chris Todd (D-CT), Republicans are largely presenting an icy posture regarding Detroit's plight - and senators on both sides of the aisle grilled Ford's Alan Mulally, GM's Rick Wagoner and Chrysler's Bob Nardelli with varying degrees of understanding and acidity. The three are scheduled for a House committee hearing Wednesday morning.
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Posted by Michelle Krebs at 3:36 AM under Analysis , Chrysler , Companies , Featured , Ford , GM , Personalities | Comments (0) | digg this |