DETROIT - After a dismal period of huge losses and deep cuts that culminated in the Obama administration's bailout of General Motors and Chrysler, the gloom over the American auto industry is starting to lift.
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Marchionne: But wait, there's more
Report: Chrysler Town & Country set to reclaim minivan sales crown from Honda Odyssey
by Jeff
Glucker on Dec 30th 2010 at
1:45PM
Is the real swagger wagon of 2010 built by Chrysler? If you go by total sales, it is. The Chrysler Town & Country has been a player in the minivan market since its arrival in 1990. Now in its fifth generation, the Town & Country has just been refreshed after a comprehensive redesign in 2008. It's not alone in getting an upgrade, however, as some serious competition arrived from Japan in 2010.
All-new minivan models for 2011 include the Honda Odyssey, Toyota Sienna and Nissan Quest, with each of them stuffing a ton of features into modern packages. The Odyssey, which has been the segment's best-seller for the last two years, has had a strong year. Yet despite serious pressure in a surprisingly strong minivan market (2010 will see the segment's first volume uptick since 2005), the Town & Country has climbed the sales board and is poised to take out Japan's finest.
According to The Detroit News, the T&C is sitting on 102,495 sales through November, while its closest competitor, the Honda Odyssey, has sold 98,035 units. Trailing further behind those two is the Sienna with 89,509 sales so far this year. There is one month left but Chrysler's, familymobile seems to be sitting pretty.
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2011 Chrysler Town &
Country ? Click above to view high-res image
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Is the real swagger wagon of 2010 built by Chrysler? If you go by total sales, it is. The Chrysler Town & Country has been a player in the minivan market since its arrival in 1990. Now in its fifth generation, the Town & Country has just been refreshed after a comprehensive redesign in 2008. It's not alone in getting an upgrade, however, as some serious competition arrived from Japan in 2010.
All-new minivan models for 2011 include the Honda Odyssey, Toyota Sienna and Nissan Quest, with each of them stuffing a ton of features into modern packages. The Odyssey, which has been the segment's best-seller for the last two years, has had a strong year. Yet despite serious pressure in a surprisingly strong minivan market (2010 will see the segment's first volume uptick since 2005), the Town & Country has climbed the sales board and is poised to take out Japan's finest.
According to The Detroit News, the T&C is sitting on 102,495 sales through November, while its closest competitor, the Honda Odyssey, has sold 98,035 units. Trailing further behind those two is the Sienna with 89,509 sales so far this year. There is one month left but Chrysler's, familymobile seems to be sitting pretty.
Chrysler's Big 2011
By: Phil
LeBeau
CNBC Correspondent
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CNBC Correspondent
After more than a year of quietly taking important steps to get Chrysler breathing again, CEO Sergio Marchionne is making it clear this is the year the company will take some big steps. Today in Italy, Marchionne said it's possible Fiat could increase its ownership stake of Chrysler to 51% this year. If it happens, it will mark yet another important milestone in the rebirth of Chrysler.
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I'm not sure people appreciate how close to death Chrysler was when the White House stepped in to bail it out.
The reason many in the Obama administration wanted to kill it is because it was a money losing auto maker with a stale line-up and no pipeline.
Fiat was the only game in town, and since taking control of Chrysler, Marchionne has guided a slow but steady turnaround. Yes, it's not yet back in the black, but it's close and will be there soon.
Chrysler: Fiat Brand Will Return To The U.S. Later This Year
TOM KRISHER AND DEE-ANN DURBIN | 08/30/10 08:40 PM |
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DETROIT ? Fiat is coming back to the U.S. after a 30-year absence, and now Chrysler Group dealers have to decide whether they want to sell the Italian brand that initially will offer just one model, the tiny Fiat 500.
At a meeting in Detroit Monday, about 400 Chrysler, Dodge and Jeep dealers who want to sell Fiats were told that the exotic minicar at first will be the only 2011 model in their Fiat showrooms.
Chrysler, which is now controlled by Italy's Fiat, was short on specifics such as price and future models. A larger model was promised, although covered by a tarp.
Chrysler hopes to sell 50,000 of the stylish, bulb-shaped 500s the first year they arrive. Eventually four versions will be offered, a standard 500, a cloth-top convertible, a high performance version with up to 185 horsepower, and in 2012, an electric version, the dealers said.
Fiat-run Chrysler Group LLC wants the 500 to become a strong contender in the U.S. small-car market, where the Detroit automaker has struggled for years. The car will be sold by about 165 Chrysler Group dealers in 125 mainly big-city markets starting in December. Chrysler hopes the tiny Italian car will help its lackluster sales.
Dealers will be asked to build separate showrooms and have separate sales and service staffs for the cars, in order to help create a distinctive European aura for the 500.
Many dealers were impressed, but some were left with questions about whether it would be worth the investment because future models were not unveiled. Chrysler CEO Sergio Marchionne, who also runs Fiat, has said that Fiat dealers will get first shot at selling the Alfa Romeo brand when it returns to the U.S. in 2012.
But the dealers were happy for a chance to sell a competitive small car, because they have had little to offer in the segment.
"There's no doubt about it. It's a home run," said Alan Helfman vice president of River Oaks Chrysler Jeep in Houston. "It's not going to make it from day one, but it will be a good seller, and it's a market I don't play in right now."
Helfman, whose dealership is near Rice University, said the car will appeal to younger people who care about the environment and fuel economy.
Carl Galeana, who owns a Dodge dealership north of Detroit, was excited about the possibility of refurbishing a former Saturn dealership to sell Fiats. General Motors Co. is almost finished phasing out and scrapping the Saturn brand.
"I'm going to put a pencil to it. I'm going to do everything I can to see if I'm going to qualify," Galeana said.
Pricing for the 500 wasn't announced, but it's expected to be around $15,000. That's close to its main competitors, the Honda Fit, Toyota Yaris and Ford Fiesta. Dealers were told to expect profit margins of $1,200 to $1,500.
Dealers have until Sept. 22 to apply for Fiat franchises. Chrysler said it will pick its dealers in the fourth quarter.
Fiat last sold cars in the U.S. in 1983, but pulled out of the country after a string of quality problems that led to the joke that its name was an acronym for "Fix It Again Tony." On one model, warranty repair costs wiped out any profits in the U.S.
Until recently, Fiat had a similar reputation in Europe, but industry analysts say the company's new models are vastly improved. The brand got low customer satisfaction scores in J.D. Power surveys in the U.K., Germany and France this year, but the 500 scored well individually.
Marchionne, took control of Chrysler after it emerged from bankruptcy last year, turned around Fiat and is trying to work the same magic with Chrysler.
But he won't be able to save the company with the 500 alone. Sales of minicars make up only about 5 percent of U.S. car sales, but the 500 can draw in customers and lend its European sophistication to Chrysler's entire lineup.
"Our dealers will be able to interact with a group of individuals that are not part of their current customer base," said Laura Soave, a former Ford Motor Co. and Volkswagen AG executive who is now head of the Fiat brand in North America.
Although Marchionne has narrowed Chrysler's losses, it is still suffering from a lack of new models.
Chrysler's sales to individuals, known as retail sales, fell 21 percent from January through June, compared with a rise of 11 percent for the industry overall. The six-month decline is worrisome because it's measured against 2009, a year in which Chrysler shut down its factories and went through bankruptcy.
Including lower-profit sales to fleet customers, such as rental-car companies, Chrysler's U.S. sales are up 11 percent through July.
The Fiat 500 will be built in Toluca, Mexico.
Chrysler `Coming Back' as U.S. Monthly Sales Top 100,000, Marchionne Says
By - Oct 2, 2010 8:11 AMChrysler Group LLC Chief Executive Officer Sergio Marchionne said ?we?re coming back? after the carmarker reported U.S. sales of more than 100,000 cars for a second month in September.
?We?ve been working on the number for quite a while,? he said today in an interview at a conference in Florence, Italy. ?I?m delighted.?
Chrysler?s U.S. sales last month increased 61 percent to 100,077, the Auburn Hills, Michigan-based company said in a statement yesterday. That topped the 48 percent average estimate of six analysts surveyed by Bloomberg. Deliveries of its namesake brand rose 92 percent to 17,348, helped by the Town & Country minivan and Sebring sedan.
?It?s an indication of the turnaround in the United States, and I think with the product lineup that we?ve got, we?ll do much better going forward,? Marchionne said.
Chrysler, U.S. Bank team up for vehicle leases
By GREG GARDNER
FREE PRESS BUSINESS WRITER
Chrysler and U.S. Bank are offering leases to new car and truck customers, the automaker and its dealers said today.
"Your customers now have a choice of finance sources to lease select vehicles. Special lease rates and residuals are now available through U.S. Bank," said an e-mail sent to the automaker's 2,400 U.S. dealers.
Ally Financial, formerly known as GMAC, will continue to be the largest provider of wholesale and retail financing to Chrysler dealers and their customers. But the agreement with Minneapolis-based U.S. Bank shows that leasing, which Chrysler stopped altogether before and during its bankruptcy restructuring, is now a viable option for more consumers.
Chrysler spokesman Ralph Kisiel said between 4% and 6% of Chrysler's sales through the first eight months of 2010 were leases.
"It's another financing source for us and another vote of confidence in the future of Chrysler," said Bill Golling, a Chrysler, Jeep, Dodge and Ram truck dealer in Bloomfield Hills. "It's good to have a degree of competitiveness between banks."
Golling estimated that in 2007 and early 2008, leases accounted for as many as 90% of the vehicle transactions at his store. Now that is closer to 40%, Golling said.
Kisiel said the agreement with U.S. Bank extends only to such 2010 models as the Chrysler 300 and Town & Country, the Dodge Charger, Grand Caravan, Journey and Nitro, and the Jeep Wrangler and Liberty. All dealers may offer the U.S. Bank leases. It will not be available on Chrysler's newest models such as the 2011 Jeep Grand Cherokee.
Ally recently adjusted its credit requirements for new vehicle leasing, said spokeswoman Sue Mallino.
"Ally still maintains prudent underwriting, and customers need to qualify for financing as always," Mallino said. "But we want to help dealers strengthen their sales."
Contact GREG GARDNER : 313-222-8762 or ggardner@freepress.com
2011 Dodge Durango unveiled
Chrysler has just pulled back the curtain on the 2011 Dodge Durango, and the newest iteration of the Auburn Hills brawler looks to have all of the bones it needs to be competitive in one of the industry's most crowded segments. For next year, the vehicle will ride on a new unibody platform wrapped in freshly-minted sheetmetal. More importantly for those looking to ferry their brood about town, it will also boast a full three rows of seating. Under the hood, buyers can look forward to picking between the company's new 3.6-liter Pentastar V6 or a 5.7-liter V8 with 6,200- and 7,800-pounds of towing capacity, respectively. All-wheel drive is available with both power plants.
Chrysler hasn't provided any fuel-economy estimates just yet.
The interior was worked over by the same gurus responsible for the superb, hide-lined cabins in the Dodge Ram and Jeep Grand Cherokee, and judging by the one teaser photo the company released this morning, it looks like a fine place to whittle away the miles. There look to be a host of smaller, but equally important changes onboard the Durango as well, including an all-new Dodge emblem on the steering wheel. If you were waiting to see what the face of the new Chrysler would look like, search no more. It's here. Look for the Durango to hit dealer lots by late this year.
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Chrysler hasn't provided any fuel-economy estimates just yet.
The interior was worked over by the same gurus responsible for the superb, hide-lined cabins in the Dodge Ram and Jeep Grand Cherokee, and judging by the one teaser photo the company released this morning, it looks like a fine place to whittle away the miles. There look to be a host of smaller, but equally important changes onboard the Durango as well, including an all-new Dodge emblem on the steering wheel. If you were waiting to see what the face of the new Chrysler would look like, search no more. It's here. Look for the Durango to hit dealer lots by late this year.
Chrysler sales up 7% with Jeep® leading the way
BY GREG GARDNER
FREE PRESS BUSINESS WRITER
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FREE PRESS BUSINESS WRITER
Chrysler defied the industry trend with a 7% increase in new vehicle sales in August from a year earlier when Cash for Clunkers inflated most of its competitors' sales.
Once again, the Jeep brand led the way with a 17% year-over-year jump, helped by a 57% sales improvement for the Patriot and 56% increase for the Liberty.
But Chrysler's year-over-year comparison benefited from the fact that it did not capitalize on last summer's Cash for Clunker incentives because it had very little inventory of its smaller models.
"We will continue to build in this momentum as we begin production on a stream of new product through the end of this year," said Fred Diaz, Chrysler lead executive for U.S. sales.
August represented the first full month that the 2011 Jeep Grand Cherokee was on sale. Chrysler sold 6,393 of the midsize SUV, down 17% from the sale of its preceding model a year earlier.
Other models that showed large increases were the Chrysler Sebring, up 79%; the Dodge Challenger muscle car, up 190%, and the Dodge Nitro, up 66%. Sales of the very profitable Dodge Ram pickup rose 8% from August 2009.
Chrysler to spend $27 million on Toronto parts plant, preserving 280 jobs
TORONTO - Chrysler Canada is spending $27.2 million on new technology for its auto parts casting plant in Toronto, preserving the factory's 280 jobs.
The plant in the Toronto suburb of Etobicoke, which currently produces aluminum die castings and pistons, is being prepared to make vehicle suspension parts called crossmembers starting in the third quarter of 2011, Chrysler said Thursday.
"We welcome this investment in the Etobicoke Casting Plant as it is an acknowledgment of the high-quality components produced by our skilled workforce for many years," stated Michael Butz, manager of the west-end plant.
"Being able to expand our part portfolio better aligns with Chrysler's long-term product strategy, which ensures the future for this facility," he added.
Canadian Auto Workers president Ken Lewenza said he was "thrilled" with the investment.
"This will help preserve and enhance jobs in the city and give a greater measure of security to our members and their families well into the future," he said.
Chrysler currently employs about 7,500 people at assembly plants in Brampton and Windsor, Ont., as well as the Etobicoke casting plant.
The Brampton plant, northwest of Toronto, has been the source of much speculation ever since Chrysler LLC emerged from U.S. bankruptcy protection with the help of its new partner, Italian automaker Fiat.
Rumour has it the plant will begin building a small number of Fiat's Lancia-brand luxury vehicles beginning in 2012.
Fiat CEO Sergio Marchionne, who took the reins at Chrysler last year after the Italian automaker took a controlling stake in the struggling company, is notoriously secretive about his product plans.
But Marchionne has said he hasn't ruled out manufacturing Fiats in Brampton, including Alfa Romeo-brand vehicles. The Brampton plant currently builds the Chrysler 300C, Dodge Challenger and Dodge Charger. It's running on two shifts and has about 800 workers on layoff.
Fiat took a controlling stake in Chrysler last year while the struggling U.S. company was restructuring.
The agreement aimed to provide Chrysler with the small vehicle technology it lacked, while Fiat would get access to the North American marketplace through Chrysler's distribution system.
In April, Marchionne said he hoped that the combined Chrysler-Fiat would build six million cars annually by 2014 with revenues of US$86.3 billion.
Chrysler Invites Dealers to Attend Fiat Experience on Aug. 30
In a move to strengthen its franchise network in 119 U.S. markets for the upcoming Fiat models, Chrysler Group, LLC. has recently written letters to more than 600 auto dealers inviting their application to sell Fiat cars. The dealers have also been requested to attend the "Fiat Experience" on Aug. 30, where they will be exposed to the new franchise requirements vis-à-vis new opportunities. According to Chrysler release, the 119 markets have "strong small-car registrations and growth potential in the small-car segment over the next five years."
The Fiat Experience program is scheduled to take place on Aug. 30 in Detroit. Ahead of the franchise-promotional program, Chrysler's vice president of network development and fleet Peter Grady and Fiat North America's head Laura Soave are seen busy contacting potential dealers for bringing them in the Fiat chain, says a media report. According to a Chrysler release, interested dealers may submit their proposals by Sept. 22 and the automaker is likely to finalise the Fiat franchisees by early October.
"The requirements for Fiat are straightforward: separate sales and display at launch, transitioning to a full dealership facility as the volume grows," says Grady in a statement.
The Fiat 500 minicar will be the first vehicle to go to the dealers. Production of the vehicle is planned to start in the fourth quarter in Toluca, Mexico. Three more 500-based models are in pipeline to hit market by 2013. The dealers may also expect Alfa Romeos to join their lineup in 2012, though no concrete statement was made by either side in this regard. Ralph Kisiel, Chrysler spokesman, only said the Fiat network "might be expanded as more new products are added to the lineup."
Kisiel has further added that Fiat franchises may go to non-Chrysler dealers if suitable Chrysler dealers are not found in a given market.
via autonews; image via ramsdenandpartners
2011 Dodge Charger R/T First Drive
By Erin Riches, Senior Editor | Published Nov 8, 201
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In a stroke of genius, Chrysler picked San Francisco for the introduction of the revamped 2011 Dodge Charger. This city is for winners. Has been since, well, November 1 when the San Francisco Giants, the major league baseball team known for stellar pitching but questionable hitting, won their first World Series title since 1954.
Some of this vibe is bound to rub off on the 2011 Dodge Charger ? or perhaps get spilled on it if we park too close to some Giants fans. But you don't need to be in some altered state to appreciate the changes Dodge has made to its big, rear-wheel-drive sedan for 2011. Most obvious is the new sheet metal, which is more faithful to the revered 1968-'70 Dodge Chargers without making the car look too old to cop an attitude. Indeed, the new front fascia is just as scary as Giants' closer Brian Wilson's beard.
Dig deeper into the 2011 Dodge Charger and you'll note that the carmaker has bulldozed the 2010 car's plasticky interior, retuned the suspension and swapped out the wheezy, old V6 engines for a new 3.6-liter Pentastar motor.
While the engineers were busy, the accountants found room to cut the price. You can have a Pentastar V6-equipped 2011 Dodge Charger SE for $25,995 ? $200 less than a 2010 Charger with the 3.5-liter V6. Better yet, Dodge has lopped a full $2 grand off the base price of the V8-equipped Charger R/T ($30,995).
The Makings of a Winner
We all like the more-car-for-less money formula, but if the 2011 Dodge Charger wasn't actually a better car, any price would be too high. We're not going to figure that out driving our R/T test car through San Francisco's maze of one-way streets, so when morning arrives, we point the Charger across the Golden Gate. Minutes later, we're on Highway 1 ? exactly the kind of road we would have avoided in last year's Charger.
On paper, the 2010 and 2011 models don't look very different. They have the same footprint ? 120-inch wheelbase and all ? and they use the same basic platform architecture and fully independent suspension with a high-mounted upper A-arm, coil-over-shock, dual-pivot arrangement in front and a multilink rear. But Dodge is using racier camber settings to improve handling on the 2011 Dodge Charger, and the springs, dampers and bushings are all new. Three different suspension programs are available on the 2011 model ? Touring (standard on V6 models), Performance (standard on the rear-drive R/T) and Super Track Pak (optional on the rear-drive R/T).
The least aggressive Touring suspension is also standard if you order all-wheel drive ($2,150) on your 2011 Dodge Charger R/T, and our test car has it ? in combination with 19-inch wheels and all-season tires. The big sedan feels a little soft through the tight turns on Highway 1, but there's a grace and fluidity to it that the previous Charger never had. This improvement takes on more significance when you note that the new car is heavier ? mostly because Dodge had to reinforce the unit body to improve crash performance.
The company has also installed an electric motor to run the Charger's hydraulic steering pump this year. Though such news is usually anathema to an enthusiast's ears, the engineers did a pretty good job tuning the effort levels. There isn't a lot of steering feel, but there wasn't much in the 2010 Charger, either.
Two Tons on the Track
In an effort to prove just how much better the revised car handles, Dodge lets us loose at Infineon Raceway for some hot laps. Feels odd lapping the big road course in this enormous sedan, but once we get over the size issue the 2011 Dodge Charger R/T is pretty entertaining. It's trustworthy for a big lug and it gets sideways in a predictable and endearing fashion.
Here we've traded our R/T AWD for a rear-drive R/T with the redundantly named Road and Track package, which includes the Super Track Pak suspension setup. In addition to upgraded dampers and thicker stabilizer bars, this option group provides Goodyear Eagle F1 tires, better brake pads and more lenient stability control.
Maybe the most shocking thing about our Charger R/T is how modern and ergonomic the interior feels.
The basic brake hardware hasn't changed in this redesign, so just like last year, all R/T models have 13.6-inch ventilated front discs with two-piston sliding calipers and 12.6-inch ventilated rear discs with single-piston sliding calipers. There's a new brake booster to improve pedal feel, but these are of course road-car brakes, so we're not surprised when the pedal starts to soften up during the track session.
One thing we really notice on the track is the improved visibility from the 2011 Dodge Charger's cockpit. The windshield is set at a more laid-back (sportier) angle on the new sedan, and the A-pillars are thinner. The view out the front is panoramic compared to the old car.
R/T Keeps the Hemi, Five-Speed Automatic
Dodge hasn't made any changes to the drivetrain on R/T models, but the fact that there's a 5.7-liter Hemi V8 with an estimated 370 horsepower available at all for the 2011 model year should make you happy.
The five-speed automatic transmission is a carryover, too. This transmission gets the job done, but having to slide the shifter side to side in manual mode gets old quickly. Paddle shifters should be part of the Road and Track package.
Charger prototypes have already been spotted with the ZF eight-speed automatic that will eventually replace this transmission, but Dodge officials will not comment on timing. They also won't talk about the ETA for the next Dodge Charger SRT8, which is destined to get the 6.4-liter V8 used in the 2011 Challenger SRT8 392.
On the other end of the spectrum, getting a V6 Charger is now a viable option, as the new Pentastar V6 engine is expected to make just over 290 hp and 260 pound-feet of torque. You're not stuck with a four-speed automatic anymore, either, as the five-speed auto is standard with the V6, too. Look for an 18 city/26 highway mpg rating on the V6 Charger. For now, you can't get AWD with the V6.
We're All Adults Here
Maybe the most shocking thing about our 2011 Dodge Charger R/T test car is how modern and ergonomic the interior feels. There's an 8.4-inch touchscreen (optional on all trim levels) in the center of the soft-touch dash, and it's neatly integrated into the same bezel as the attractive gauge pack. The new steering wheel is a bit heavy on the buttons, but comfortable to grip at 9 and 3. Finding a good driving position is easy, and we'd have no qualms about sticking with our tester's standard cloth upholstery.
The navigation system uses Garmin software, and though the street labeling isn't as consistent as it could be, there's no arguing with the colorful display and simple destination entry. If you've ever used a Garmin Nuvi, you can use this nav system without ever cracking the manual.
Keyless access, a USB jack, a driver knee airbag and laminated windshield and side-window glass are standard on all 2011 Chargers. Dodge is making a point of offering all the upscale extras with either engine. So even if you choose the base V6, you can still option your Charger up with adaptive cruise control (bundled with a collision warning system) and the Driver Confidence package, which includes blind-spot monitoring, a back-up camera and rear cross-traffic detection.
Fear the Beard
Dodge designers call the 2011 Dodge Charger's front fascia "Superman's Chest." We, on the other hand, can't stop seeing visions of Brian Wilson's black beard when we walk up to this car. We're not sure which is the more unsavory image ? flexing pectoral muscles or luxuriant facial hair ? but there's little doubt that the 2011 Charger is supposed to make you feel uneasy. It's the last rear-drive family sedan standing, and unlike the Pontiac G8 (RIP), it's not meant to be a BMW 5 Series on the cheap. It's a baddie.
Or at least that's the image it projects. Beneath all that, the 2011 Dodge Charger R/T is as quietly effective as Wilson's slider. It has a more refined ride than its predecessor, and its handling is honest and secure. Its cabin has finally made the leap from the 1990s and offers both quality materials and the modern technology you expect in this price range.
And it definitely doesn't hurt that the 2011 Dodge Charger is cheaper than last year's model. This could indeed be the winner that Chrysler desperately needs.
Vice President Biden tells Toledo Jeep crowd auto bailout a success Funds led to comeback, V.P. says in Toledo
Vice President Joe Biden and an array of Ohio Democratic politicians celebrated the comeback of the American auto industry in a tour and speech at Toledo's Jeep Wrangler assembly line Monday.
The vice president said the recession that started in 2008
could have destroyed hundreds of thousands of jobs in the automobile industry if
the government hadn't extended emergency loans to keep the companies afloat.
The vice president played up his car connections, saying he once applied for, but didn't get, a job at a GM factory and that his father was a car dealer. He got one of his biggest cheers when he told the crowd that he's had a Jeep in his driveway continuously since 1973.
Workers Kevin Durczynski, 43, of Oregon and Amy Vollmar, 44, of Tontogany, Ohio, showed the vice president how they attached windshields to Wranglers.
An Improved Chrysler Is About to be Tested
By: Phil LeBeau
CNBC Correspondent
CNBC Correspondent
Give Chrysler CEO Sergio Marchionne and his management team credit. The patient is no longer on it's death bed. In fact, if you look at Chrysler's second quarter financial results you see a nice improvement.
Sure, the company is still losing money ($172 Million), but that's an improvement over the first quarter and it once again posted an operating profit ($183 Million). Meanwhile, it's cash position jumped to $7.8 Billion. Thanks to an improving auto market and higher volumes, Chrysler is doing better.
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But don't be fooled. These numbers show a company that has been stabilized. As Marchionne himself will point out, the American automaker still has a long ways to go. Which is why the second half of this year will be critical to the Chrysler turnaround.
Between now and the end of the year Chrysler will roll out 15 new and refreshed models, to join the revamped Jeep Grand Cherokee. These are the horses Chrysler needs to ride if its sales (and profits) are going to improve.
If Chrysler does as as well with these new models as it has done so far with the Grand Cherokee, then the second half will be the inflection point people have been waiting for.
The Grand Cherokee is a dramatic improvement over the old model, and the early reception has been solid. Now the company needs to get the same reaction from the Jeep Compass, Jeep Patriot, Dodge Caliber and Jeep Wrangler refreshments. But that's just the start, before the end of the year, we'll see a new Dodge Durango and the first versions of the Fiat 500 will start rolling into dealerships. That's a lot of new product in a short period of time.
But in many ways, the new models can't come soon enough. Have you visited a Chrysler dealership in the last six months? These guys are starved for new products. In the last three years they've been trying to win over buyers with big incentives, and little else. So as Ford and General Motors dealers have had a steady supply of new models to attract customers, Chrysler dealers have had to sit and wait.
So while it's encouraging to see Chrysler improving its balance sheet, lets keep it in perspective. Until now, the challenge for Chrysler has been stemming the losses and setting the stage for a comeback.
Starting later this month and then through the end of the year, we'll see whether Chrysler has the goods to once again show American buyers they should keep the smallest of the big three on their shopping list.
Detroit Goes From Gloom to Economic Bright Spot
By BILL VLASIC
Published: August 13, 2010
Jeff Kowalsky for The New York Times
Jobs are growing. Factory workers are anticipating their first healthy profit-sharing checks in years. Sales are rebounding, with the Commerce Department reporting Friday that automobiles were a bright spot in July's mostly disappointing retail sales.
The nascent comeback is far from a finished product. Foreign competitors are leaner and stronger, accounting for more than half of all car sales in this country. The sputtering economic rebound is spooking investors and consumers alike, threatening to derail some of Detroit's gains. And talks next year on a new contract with the United Automobile Workers could revive old hostilities.
Still, the improving mood here reflects real changes in how Detroit is doing business - and a growing sense that the changes are turning the Big Three around, according to industry executives and analysts tracking the recovery.
Ford made more money in the first six months of this year than in the previous five years combined. G.M. is profitable and preparing for one of the biggest public stock offerings in American history. Even Chrysler, the automaker thought least likely to survive the recession, is hiring new workers.
Many of the excesses of the past - overproduction, bloated vehicle lineups, expensive rebates - are gone. All three carmakers have shed workers, plants and brands. And a new breed of top management - the three chief executives are outsiders to Detroit, as is the newly named G.M. chief executive - says it is determined to keep the Big Three lean, agile and focused on building better cars that earn a profit.
"What we've come out of this with," said Sergio Marchionne, who runs both Chrysler and its Italian owner Fiat, "are much more rational, more grounded players making moves for the long term."
The proof is emerging in dealer showrooms, where customers are buying more of Detroit's cars and paying higher prices. In July, G.M., Ford and Chrysler sold their vehicles at an average price of $30,400 - $1,350 more than a year ago and higher than an overall industry gain of $1,100, according to the auto research Web site Edmunds.com.
With fewer factories churning out products, inventories are smaller and sales incentives like rebates and low-interest financing are gradually declining. "They were nibbling at these issues before, a little bit here and a little bit there," said Jeremy Anwyl, Edmund's chief executive. "It's just different now that they are in fighting shape."
Detroit has vowed to change before, slimming down when sales slumped or pouring resources into vehicle quality to catch up to foreign competitors. Those efforts stalled or failed. But many auto analysts say the current makeover has a more permanent feel, largely because of the presence of the outsiders at the top and the lessons learned from the near-death experience of last year's bankruptcies at G.M. and Chrysler.
Ford's chief executive, Alan R. Mulally, broke the mold four years ago when he came from Boeing and set out to streamline Ford's bureaucracy and integrate its worldwide operations. At G.M., Edward E. Whitacre Jr., a former AT&T chief, has replaced dozens of top officials with outsiders and younger executives, and driven the company to make decisions faster. Those efforts are likely to be accelerated under Daniel F. Akerson, who was named on Thursday to succeed Mr. Whitacre as chief executive in September.
And at Chrysler, Mr. Marchionne, an Italian raised in Canada who is both a lawyer and an accountant, is systematically upgrading the carmaker's aged product lineup and revamping its plants in Fiat's image.
"Fundamentally this thing has been reshaped, resized and rethought," Mr. Marchionne said of Detroit. The biggest difference, he said, is that the Big Three have finally broken the habit of reflexively raising incentives to increase sales volumes.
"We're not trying to kill each other for this month's market share," he said. "Those days are over. We're not offering $7,000 checks to try to sell a car."
Wave after wave of plant closings and worker buyouts in recent years has brought Detroit's production more in line with the demand for its vehicles. Since 2000, the number of Big Three assembly plants in North America has dropped to 40, from 66, according to the consulting firm Oliver Wyman. In turn, overall capacity has shrunk to about eight million vehicles a year, from 13.7 million.
That still may be too much. After several years of sales topping 16 million vehicles, the industry nosedived to 10.4 million last year - the lowest since 1982. At current levels, sales are projected to edge up to about 12 million this year, with Detroit's share running at 46 percent.
"They carved out a lot of capacity, but I'm not sure it was enough," said Peter Morici, an economist at the University of Maryland. "There's still an excess."
Even under the most hopeful assumptions, a resuscitated United States auto industry in the end would account for less than 3.5 percent of the country's economic output, economists estimate, compared to 4.6 percent in the late 1970s. But the Obama administration, which argues that the comeback is long-term and sustainable, contends that the Big Three have downsized enough to be profitable with fewer sales.
"They were just barely making money or breaking even in a market of 16 to 17 million a year," said Brian Deese, a member of President Obama's auto task force. "The companies are positioned now to move forward in an environment of 11 to 12 million in sales."
Some Republicans and other critics of the administration are less bullish, and suggest it is too early to know if the restructuring will stick or how much credit the federal assistance is due. That debate will likely play out in the November midterm elections, but in the meantime some of the raw numbers are falling Detroit's way.
The bankruptcies at G.M. and Chrysler slashed debt, jobs and labor costs, and revised union contracts have brought manufacturing expenses more in line with factories in this country operated by Toyota and other foreign automakers.
The average production worker at G.M. earns $57 an hour in wages and benefits, compared to $51 at Toyota, according to a study by the Center for Automotive Research in Ann Arbor, Mich.
Those costs should continue to fall as the companies hire new workers at lower pay grades agreed to by the U.A.W.
"What's come out of this crisis is a realization that the interests of both sides are aligned," Harley Shaiken, a labor professor at the University of California, Berkeley, said of workers and management.
That alignment could be tested next year when the Detroit companies negotiate a new contract with the U.A.W. The union's president, Bob King, has vowed to get back some of the concessions made in the bankruptcies.
For now, though, the industry is adding jobs for the first time in a decade. More than 330,000 jobs were lost by the American automakers and their suppliers in 2008, White House officials said, while 55,000 jobs have been added since Chrysler and G.M. emerged from bankruptcy in the summer of 2009.
Chrysler, which cut more than half its work force since 2005, has added 3,100 jobs this year, including white-collar jobs at its headquarters in suburban Detroit. The company is recruiting again on college campuses and bringing in entry-level engineers and managers.
One of the first new hires was James Kim, an electrical engineer who recently graduated from the University of Michigan. Mr. Kim also had job offers from Verizon and other companies.
"I saw an opportunity to get into a company that was rebuilding itself from the ground up," said Mr. Kim. "It's almost like going to a start-up business."
Another new white-collar worker, Davida Redmond, joined Chrysler after taking a buyout from Caterpillar. "I felt like the worst was over in Detroit," she said. "The storm is behind us."
But for the recovery to last, some economists say, several things need to happen, including continued improvements in quality, a relentless focus on cutting costs - and some luck on the economy's overall strength.
"Their recovery is not sustainable yet," said Mr. Morici, the economist. "They need to reduce their costs more if they're going to be competitive in the long term with the Japanese, the Koreans and ultimately the Chinese."
Top management says it is well aware of the rough patches ahead. "We still have important work to do," said Mr. Akerson, the incoming G.M. boss.
Even so, optimism is building in the offices and plants and engineering labs of the Detroit companies, employees say. And promising new electrified vehicles like the Chevrolet Volt and small cars like the Ford Fiesta are slowly changing consumer perceptions that the Big Three are behind the times.
"It wasn't long ago that people had just written them off," said Mr. Shaiken, the labor professor. "But they live to fight another day."
2010 Ram 1500 Laramie pickup
By Ron Amadon, MarketWatch
GREAT CACAPON, W. Va. (MarketWatch) -- Rolling along for miles on Interstate70 to get to some great off-road running, it was hard to believe that this was a big ole' American pickup.
The leather-trimmed bucket seats were such that the trip could well have been extended to Alaska. They were 10-way-adjustable with power lumbar, and easy on the back. There was an abundance of head, shoulder, leg and every other kind of room. Two real adults would be quite comfy in the (heated) rear seats of this Dodge Crew Cab model, something I seldom get to say about any vehicle any more, it seems.
The interior was serene as the big V-8 loafed along at legal highway speeds of 65 mph and a bit above that. There were luxury touches everywhere and it was easy to believe that this was not a truck, but a luxury car -- although a rather large one. Acceleration was more than adequate.
The A/C and ventilated front seats easily offset the record-breaking hot and humid weather that seems to have declared the mid-Atlantic region as its home this summer. The 500-watt Alpine surround sound audio system sounded wonderful on satellite channels and on the Willie Nelson CD that also made the trip. (Come on, who else ya gonna listen to on a long day in a pick up?) And the 30 gig hard drive will store 6,700 of your favorite tunes.
Winding over the snake-like curves and ups and downs of Route 9, the large size of this truck was apparent, but not an impediment. Ain't no mountain high enough where there is a 5.7-liter, 390 horsepower Hemi V-8 under the hood that bats out 407 lb-ft of torque at 4,000 rpm. It was matched to a 5-speed automatic in the test truck and EPA rated at 13-18 mpg. I got 15 on the trip, but that included miles of slower speed running on what was once a railroad road bed. The Ram likes mid-grade gas.
The heavy duty engine cooling did its thing on this day of 90-plus degree temperatures and the Electronic Shift on Command transfer case got a workout too, with nary a spun tire, thanks in part to an anti-spin differential rear axle.
Even on steep hills with lose dirt and rocks, the Ram simply seem to say, "Oh come on, this is no real challenge."
By the way, Chrysler /quotes/comstock/23g!f (IT:F 9.80, +0.04, +0.41%) got a brilliant idea to use the otherwise wasted space on either side of the truck bed as lockable storage. You can keep beverages cold there, and then pull a plug to let the melted ice run out. Brilliant, I say!
Even along heavily potholed former roadbed, the ride was never punishing, thanks to the coil-spring rear suspension, and not the leaf-spring suspension used by so many truck makers.
The size does make itself known when you head out to the supermarket or shopping center and want to park. It is easier to head for the back 40 where it is less crowded, and besides, the exercise is good for you.
How big is the Ram? A total of 229 inches long, 79.4 wide and 75 inches tall. It is a big step up to enter the cab for shorter folks, with the truck's 9.6 inches of maximum ground clearance.
The test truck would carry 1,430 pounds of cargo and tow a 7,000 pound trailer. It cost us (gulp) $65 to fill it up at trip's end when it was running on fumes.
Yet there was never a time when I didn't look forward to driving the Ram, once called a Dodge, pickup. It was always fun and turned more than few heads out here in pick up truck country.
With $3,580 worth of options including the transportation charge, the test truck carried a bottom line of $46,320. Less expensive Rams can be had, of course.
If the Ram lasts as long and is as trouble free as the much loved Dodge Dakota pickup I owned, owners will build up a fond affection for this big truck. After all, it was introduced during a cattle drive down the streets of Detroit.
Hubcaps
New acquisitions Land Rover and Jaguar helped India's Tata motors post a $428-million quarterly profit, where there had been a loss a year earlier.
Ford is closing out the venerable Crown Victoria, which made me wonder what taxi drivers will be herding us around in.
About 600 dealers have been invited to Chrysler headquarters in Auburn Hills, Mich. The Detroit News reports they will be briefed on what will be needed if they want to sell the parent firm's Fiats in this country.
Kelley Blue Book named the Honda Civic as the best back to school car, followed by the new Ford Fiesta. The Mazda 3 came in third. And the impressive new Chevy Cruze also made the list
Vehicles tested in this column are on loan from the auto companies through local distributors.
Ron Amadon is an auto writer and morning news anchor on the MarketWatch Radio Network, based in Washington, D.C.
Ron Amadon is an auto writer and morning news anchor on the MarketWatch Radio Network, based in Washington.
Chrysler's Comeback: Chrysler Posts September Sales Gain of 61 Percent
Posted October 1 2010 12:30 PM by Rory Jurnecka
A September sales gain of 61 percent has marked Chrysler Group's sixth consecutive month of year-over-year sales gains in 2010. Last month, despite Cash for Clunkers making sales gains difficult, Chrysler posted a 7-percent increase.
According to Chrysler, each of its four core brands delivered sales gains in September versus the same month in 2009, with Chrysler leading the way at a 92-percent year-over-year gain. The automaker reports triple-digit increases for Chrysler Sebring sedan and convertible sales as well as a 149-percent gain for the venerable Town & Country minivan.
The Dodge brand was also a hot performer, with all brand models showing gains for September. Grand Caravan sales increased 96 percent over the previous year, Nitro volume gained 79 percent, and Avenger and Challenger sales both grew by 76 percent. Many Dodge models will receive significant updates later on in the quarter, with an all-new 2011 Charger to launch shortly.
Meanwhile, the Jeep brand posted a gain of 65 percent year-over-year, lead in no small way bythe all-new 2011 Grand Cherokee. Grand Cherokee sales skyrocketed to a 98 percent gain as the new model trickles into showrooms, while the Patriot and Compass each posted strong triple-digit gains. October could be another strong month for Jeep as the 2011 Wrangler enters showrooms with its all-new interior, to be followed by the refreshed 2011 Patriot later in the quarter.
The Ram Truck brand also made an impressive showing, with a sales increase of 22 percent for September. Ram pickup truck sales increased by 26 percent for the month, while Dakota sales shot up 141 percent over September 2009.
