No big sellers in sight to save troubled Chrysler

Source: AP

By TOM KRISHER

DETROIT (AP) - In crises past, Chrysler has somehow managed to stamp out a blockbuster hit vehicle to pull itself away from the cliff's edge.

But as it faces a possible sale to another automaker and what may be the most serious problems in its 83-year history, industry analysts say there's nothing in the current product portfolio that looks like a savior.


Unsold 2008 Wranglers sit at a Chrysler-Jeep dealership in the north Denver suburb of Thornton, Colo., on Sunday, Aug. 24, 2008. The smallest of Detroit's three automakers, once-brash Chrysler took risks and gained big rewards for vehicles like its hit 300 full-size sedan in 2005. The company invented the minivan when it introduced the Plymouth Voyager and Dodge Caravan in 1984, and the Plymouth Reliant and Dodge Aries "K-car" sedans of 1982 helped earn the money to repay $1.5 billion in government-guaranteed loans former Chairman Lee Iacocca secured to save Chrysler from going under in 1980. (AP Photo/David Zalubowski)


Chrysler's U.S. sales are down 25 percent through September, the worst decline of any major automaker. Losses are mounting: well over $1 billion for the first half of the year. Things are so bad that Chrysler LLC wants to shed a quarter of its salaried work force, and its owner, Cerberus Capital Management LP, is talking with General Motors Corp. (GM) (GM) and others about a sale.

Of Chrysler's 26 models on sale in both 2007 and 2008, only four have sold more this year than last, and three of those are small-volume niche vehicles such as the Dodge Viper. The company's market share has dwindled from 16.2 percent in 1996 to 11 percent this year, according to Ward's AutoInfoBank.


Read more: http://apnews.excite.com/article/20081101/D946C54O0.html

Too bad Chrysler, GM and Ford all talk about it but never put one on the dealership floor.

Oh wait! http://en.wikipedia.org/wiki/General_Motors_EV1

Perhaps they just need to produce one that they don't take back and destroy. :shrug:

Think you'll be able to find something good to say about them?

The price of a Mercedes or BMW....not exactly the "everyman" car we were hoping for......

The amount saved from not buying as much gas could make it worthwhile to spend more upfront for the car.

I was thinking more in terms of the affordability. Most persons cannot afford a $500+ / month car payment and gas would still be the cheaper option in some cases.

As an example. I have a paid for 1986 Chevy cavalier that I use for my 70 (RT) mile commute. At 33 miles per gallon. In a given month, I do not come close to spending $500/month on gas so why go for the added expense for an untried American make. Better for the environment, perhaps, but my point (though admittedly understated) is that with the subsidies the auto industry getting and wanting more an 'everyman car" is what the market craves and is needed from US auto manufacturers. Once again Toyota with the Prius is closer and more affordable. US auto companies just still do not have a clue.

GM plans for the price to match the average for new cars sold in the US. That's $28,800. http://www.ftc.gov/bcp/edu/pubs/consumer/autos/aut11.shtm

You haven't factored in government incentives, which are almost $5K. GM will sell these at a loss initially to keep the price near the US average, and count on cost to decline as volume picks up. They see the future, and are willing to undergo negative revenue to buy a piece of it.

If you don't understand how this business concept works, I suggest you investigate how much SONY initially paid to manufacture a PlayStation 3, versus how much they charged for them. Then look at the current ratio.

The average Prius, by the way, cost about $25K OTD in the trailing model year, and that is going up. The Volt has a true electric drivetrain rather than a hybrid like the Toyota, and will cost substantially less to drive per mile, with a substantially lower CO2 footprint.

Hmm. Greener, cheaper per mile, and built by UAW workers. Guess we'll see which showrooms "real" progressives visit.

I took my info from the NPR report quoting/interviewing the GM spokesman. You may indeed be correct, but seems like an odd thing for a spokesman for the company not to have included your figures in his final number thereby putting the best face on the matter. I actually hope you are right.

But then again, the carbon footprint for manufacture and disposal of these batteries may also prove an issue.......Thanks for sharing.

As for where real progressives comment...... sounds a little too much like "my country right or wrong"......as for "real".....like, Ms. Palin, in blind faith or pius fog one should really not sit in judgment.

The "real progressives" comment wasn't necessary.

I'm frustrated. There are a lot of people here on DU who have nothing - and I mean nothing - positive to say about domestic car companies. 300,000 people's jobs depend on them. State and local governments depend on them. An entire region of our country depends on them. It would be in everyone's best interests if the criticism were more constructive, and if fresher observations replaced the old, reflexive scorn.

Proud former union member, proud owner of a domestic made car (always have been), but always miffed that automakers/management fail their members and the public on so many levels when they produce products that fail to meet the basic need of many for affordable transportation. In the coming needed transition to electric cars, affordability will be key if we don't want the less than middle class to make the leap instead of propping up the old gas models as they do(though for different reasons) in Cuba. Best to you my friend!

GM has pushed that date back so often it's become an industry joke. It's the automotive equivalent of vaporware. They've already let BMW beat them to the market with the electric mini, Honda and Toyota have captured the majority of the hybrid market, and even Ford has come out with hybrids. Where's GM? They're stuck on Flex Fuel.

I would absolutely love to see GM turn around, as well as Chrysler and Ford. Living in SE Michigan, my family's future is strongly tied into the solvency of "the big three". But that doesn't mean I should sit back and just play "yes man" for them like their boards have done for the last 30 years. That attitude has cost us too much already.

So you can call their mismanagement and lackluster performance wonderful if you like. I'd rather tell the truth in the hopes that eventually they listen.

Having done lots of research and interest in the vehicle, I can tell you why it's taking a long time to get out there.

Traditional hybrids have the electric power used only for slower speeds and shorter distances. The gasoline motor drivers the car at speeds over 30 miles per hour. The gas engine is the primary form of power for the car, with the electrics second. Great for stop and go city driving, not so much so on longer runs. This is also why the Prius only gets 38-40 mpg on the highway, which many larger cars can top.

The Volt on the other hand only has a tiny four-cylinder engine, which is not in any way connected to the wheels. the engine drives a generator, which feeds power to the wheels. Also, the Volt has newly-developed battery cells, which are more advanced than the units on the Prius. That development is part of the reason why the development is so long - they want to get it right the first time. GM's reputation is bad enough, thanks.

But the Volt's drive system will be able to feed a bunch of cars, because all you need to do is adapt the system for various size vehicles. The Opel/Saturn Flextreme is a Volt with a different body on it. Both absolutely destroy the Prius' fuel economy and advancement.

The Volt will be able, for those with short commutes, to run for months without a fillup. Just plug it in every night, you have 85% charge in the morning. On longer trips, that small engine sips gas. Preliminary testing has said it will average at least 50 miles to the gallon on every cycle. Some cycles push that to as much as 150 mpg. (Not kidding.) Now, what happens when GM's new diesels find their way into Volts?

It's a different game now than it was then. GM's board has been populated by morons for a long time. It isn't any longer. The Volt is just the beginning, too.

They cant just release a car out to the public like that, they have to do a ton of testing and R&D to make sure their are no major issues after its release date. A car being developed usually takes at least 3 or 4 years of testing a designing before it hits the market. Have some patience.

If you haven't heard of the company, it was created by Leo Burnett to function as the exclusive media buying unit for General Motors in 2000. It was part of the largest advertising contract in history at the time (maybe still is). Anyway, I can state from personal experience that the Volt was being talked about by our execs in 2001 which means it was also in R&D at the time. Now even if it was the very beginning of R&D that means it will take nine years (if it really does come out in time) from concept to showroom. That is not an acceptable turn around for a company that claims to want to be on the cutting edge of innovation. Especially when said company had already released a successful electrically powered vehicle four years prior to the beginning of that R&D. It's not like they had to start from scratch, without the knowledge gained from the EV-1 project.

I'd go so far as to say that GM is probably only coming out with the Volt now, if it does, because they can't stop other manufacturers from doing so if they don't.

If talks or plans of it began in 01 they might have been holding out on it cause they were banking on the truck and SUV sales. Bit wasent battery tech real limited untill the most recent years?

Also, if you ever watch "Who Killed the Electric Car" you will see that GM actually crushed newer battery technologies that could have created even better performance.

Because the EV-1 was a small lightweight 2 seater car, the Volt I imaging is a hell of a lot heavier than that and that why its has the 40 miles range. The Volt also does 0-60 in 9 seconds BTW.

Imagine what advances could have, and should have, been made in the last 10 years had GM used the technology it abandoned with no reason ever given. Instead of losing miles per charge, we could be seeing a vehicle with enough power to rival a gas engine in distance and pickup.

The newest battery technologies are coming out of Asia and have been for a long time. If you think that GM could deep-six an advanced battery technology and no one else in Japan, Korea, China, etc. would have already surpassed it, you're living in the 1950s.

EV-1 was abandoned because it wasn't a real car that average people could use. It was a niche mobile, a technology demonstration project. Too light, small, unsafe. GM couldn't make the numbers work on a version that would pass safety tests and meet real-world driving needs.

Someone would have to be either congenitally innumerate or under the reason-blinding influence of ideology to think a major industrial company struggling in a globalized marketplace wouldn't jump feet first into a new product line that would make them billions of dollars, if they could figure out how. My guess is it's the second explanation.

Since you've gone into that realm I'll just have to assume you have no real clue as to what you're talking about.

I withdraw the insult; I stand by my arguments.

couldn't have made the gazillions they have in the last 8 years either. THAT is what killed the technology. Good old American greed. Thanks Ronnie Raygun for all your damn trickle down shit. I hope you trickled on down.

Never heard of them pushing the date back for the Volt.

The Vatican just bought Chrysler....will be know as " Jesus Chrysler"....:rofl:

n/t

They had three Voyagers followed by a Town and Country when Chrysler dropped the Voyager name.

I hope they get some smart leadership and are able to survive and produce some efficient US-made vehicles.

The short-sightedness of their management is to blame for the failure.

They just can't see past this year's bottom line.

Beautiful and impractical.

Glad I never bought one.

Let 'em Die!!!!
First of all I am a American Musclecar Gearhead of 36 Years,and I find nothing more soothing than the sound of 600 Horsepower accelerating away under full throttle!!!
That said,I have owned half a dozen Chrysler Products in my almost 40 years of playing with Cartoys,3 Darts,1 Valiant,2 Vans (One Dodge and one Plymouth) and currently own a 2001 Plymouth Neon with 66,700 miles.And I take care of my autos!!

Chrysler Products are Garbage!! Poor Fit and Finish,Lousy engineering,Poor Parts Supply Chain (The aftermarket always has done a better job of this than Chrysler)
Chrysler has in the last fifty years only gotten two things right...the 225 Slant Six and the original 426 Hemi!!

Edit: the Neon was a gift from a family member,They thought I needed a "Good" car...The Corolla that I drive Everyday is "Too Old" for my Repuke inlaws!! One would have to pry my cold dead fingers from the steering wheel of my 'Yota!!!!

Though its built kinda cheap, its been an awsome truck honestly, being a midsize truck, I wouldn't buy anything bigger or smaller, its just the right size for me! I would've bought an 05+ Toyota Tacoma but they're too damn expensive for me, so I picked up this one for 14 grand a 4 months ago.

"Analysts say there are no cutting-edge designs or potential big sellers in sight to rescue the maker of the Chrysler, Dodge and Jeep brands".

A classic example of excessive risk taking, which we've seen a lot of lately with these groups that have (err, had) too much money.

They should have been looking for something like the Tesla to produce and market. Too bad they never could understand that dropping Trucks, SUV's and Vans would have made all the difference in the long run.

It's a classic mistake they are all making, confining themselves to a market they think they know.

Even though I think this has been coming on for 3 years it's sad to see it happen and all those who will lose their jobs because of it. My bet on the next to go will be Ford.

Danny "runs" Cerberus, or maybe he just thinks he runs it.

and imagined that--what the hell was wrong with Chrysler?

I looked at them too when they first came out and was shocked that their average gas mileage was below 20 because Chrysler decided to avoid higher gas mileage standards by calling it a light truck. By contrast my '99 Dodge Grand Caravan gets up to 28 mpg highway (also much better than the current Dodge Grand Caravans)

...that is what will save Detroit auto makers

that the only way to save Chrysler is to start buying Honda , Toyota , or Nissan engines and transmissions to put in their vehicles. The idea is not that far fetched since GM put Honda engines in their Saturn Vue. Chrysler does indeed have a garbage power train.

and my Border Collies life.

It was a Plymouth Gran Fury. Got it's best gas mileage at 70. My border collie Sarah and I were on our way from Gainesville Florida to Ft. Lauderdale. We were cruising down 75 at 70 mph and it was foggy. All of a sudden the back of an 18 wheeler came flying toward us and we hit it doing 75. The damn truck had stopped! in the middle of the road.

Both Sarah and I had seat belts on. This car had no airbags and all I got was a fat lip and Sarah a bruised shoulder. We both walked away from it. What saved us was the fact this car was made of steel and the frame was not a unibody, but in sections. The front frame was lifted 2 inches and the engine hadn't moved.



If Sarah and I had been in any other car, we'd of been killed. I'll be sorry to see Chrysler go.

ZW

Not sure which part of your story is less believable, the idea that any car would get it's best gas mileage at 70 MPH, or that a dog would sit still enough in a seat belt...

Just like in the jungle.....only the fit survive.

Chrysler has made poor choice after poor choice and now things have come home to roost.

I work for Chrysler LLC at the Kokomo Transmission Plant. I've watched this unfold from a unique perspective. I'll try to compare what we at Chrysler have been watching unfold for the past 5yrs, to what we've all witnessed here in America happen in that same span of time.

From my perspective it's been a "top-down" problem concerning the direction Chrysler's willing to go.
There have been more than a few "shakeups" in the boardroom that have limited and sought to narrow the view for the future. It's difficult to stick with a 5 or 10 yr plan when you change your leadership and your game-plan so often.

There have been many mid-level supervisors that I've talked to that were concerned, back in the gasoline price hikes of '06, about our lack of hybrids and electric plug-ins. Then we changed ownership again.

I really don't know where I'm going w/ all of this...this probl'y could become a doctoral thesis before I could enlighten some of you about how & why this happened. but in the mean time, realize that there are many aspects to this problem. They're trying to break the Union, the UAW, they're implementing cost-savings measures at the same time their asking for better productivity. not to say that it can't be done. It's just one more piece of the puzzle we're trying to fit into some hole. My plant, KTP, has won The Harbour Report for transmissions in 5 out of the last 6 years and we're now implementing WOM (Workplace Organizational Model), basically a "team" concept, instead of performing our own bought jobs, we're rotating...doing all of the jobs in that team. Because Auburn Hills has mandated that it must be done...not that it's needed to be done.

So yeah...as we watch our jobs go down the tube, our livelihood along w/ it..we watch as our leaders become impotent...Aimless and rudderless we continue to "put our heads down..and go into work" everyday not knowing who will be controlling our company the hour that we clock out.

It doesn't have to be this way! It didn't have to be this way!

so forgive me for thinking and believing that it was designed for failure.

w/ all of the greedy bush cabal that's now in our leadership, it's difficult to think that their hearts were in the right place!

http://www.toledoblade.com/apps/pbcs.dll/article?AID=/20081023/BUSINESS02/810230392

The Jeep assembly plant announced on the 25th of October that it would drop one whole shift of production. Obama's statement in support of the autoworkers is in the article.

Funny, I don't remember McCain saying anything....