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Filed under: Chrysler, LLC. , Earnings/Financials It's up and down, but nowhere near out for Chrysler, LLC. The Big Three's smallest sibling says that it's ahead of internal estimates and has posted earnings in excess of one billion for the first half of '08. True, the company also posted a $510 million loss in Q1 according to minority shareholder Daimler. And since Chrysler is privately held, it doesn't need to tell anyone whether these earnings put it in the red or black. But whatever's on the books was good enough to convince lenders to grant Chrysler's financial arm a $24 billion line of credit. Said a Chrysler spokesman, the money will be used to "support our dealers and their retail customers." The pentastar just got out of the leasing business , so the influx of credit will keep the financial arm doing what it needs to do as all those remaining lease vehicles come back with empty tanks and bottomed-out residuals. And believe it or not, those...
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Filed under: Car Buying , SUVs , Chrysler, LLC. , Dodge , Jeep , Earnings/Financials The automotive sales sector is in a major state of flux as consumers continue to run from SUVs and pickup trucks into smaller, more fuel efficient cars. One manufacturer hit especially hard by this transition is Chrysler, a company that recently posted the worst fleet average fuel economy numbers of all major automakers in the U.S. due to its truck-heavy lineup. Still, the automaker has built up a large supply of Chrysler, Dodge and Jeep utility vehicles that they have got to get off dealer lots somehow. To ease consumers into the fuel-thirsy utes, Chrysler has introduced new incentives of zero-percent financing for 72 months on the 2008 Dodge Durango, Chrysler Aspen and Jeep Grand Cherokee and Commander. While the lack of any financing charges will certainly impact the bottom line, it is nothing compared to the losses the automaker has been hit with over its past lease deals. In fact, truck and SUV residuals...
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Filed under: Car Buying , Chrysler, LLC. , Earnings/Financials Chrysler LLC's financial division will no longer be offering leases to U.S. consumers on Chrysler products as of August 1st. The automaker will be holding a conference call with dealers later today to go over the changes and the reasons behind the decisions, but Chrysler spokesperson, Bill Porter, told Reuters "We are shifting our strategy to focus on retail products." The move comes amidst Chrysler's attempt to get 20 banks to renew a $30 billion credit facility for the automaker's financial arm. The rise in borrowing costs next month will make it more difficult for Chrysler to offer low-interest loans and could spell further disasters on the sales front. Thanks to all who tipped in. [Source: Reuters , WSJ ] Read | Permalink | Email this | Comments
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Filed under: Chrysler, LLC. , GM , Earnings/Financials Despite recent rumblings to the contrary, both General Motors and Chrysler claim that they will not be going bankrupt any time soon. Still, as much as the two American automakers would love to quell fears of unsustainable liquidity, questions remain, especially as the pickup market in the United States continues to dwindle. In a note sent out to dealers, Chrysler's Jim Press and Steven Landry say that the automaker will focus its efforts on small cars for the rest of this year, though the current pickings from the automaker's stable seem a bit slim. Chrysler is surely banking on its alliances to bolster its line of small car offerings, which could help to dampen the blow of lost truck profits -- somewhat. General Motors , for its part, has invested heavily into its upcoming Delta platform vehicles, which will include a compact Chevrolet-branded car known as the Cruze as well as the Chevy Volt electric vehicle. [Source: Automotive...
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Filed under: Sedans/Saloons , Etc. , Chrysler When the Chrysler 300 dropped on an unsuspecting public in 2004, it was all crisp edges and upright stance, with a bulldog face to help drive home the message of urgent thrust delivered by a reborn Hemi V8. Chrysler's got a refreshing in the pipeline for the 300, and that's giving designers fits. It's akin to sophomore album syndrome - when the original is a huge hit, how, exactly, do you follow it up? Chrysler designers are invoking the Porsche philosophy used to update its 911 through the generations as a roadmap for the 300's body changes, so don't expect anything too dramatic on the outside. Inside, however, will be where the real action occurs. While not the worst interior Chrysler puts out, it's certainly got room for improvement. Cerberus chairman Steven Feinburg is reportedly passionate about improving the quality of Chrysler's offerings, and the lower quality materials we have today are being jettisoned in...
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Filed under: Chrysler , Misc. Auto Shows The folks at Chrysler have proven that they know how to make a BIG splash when debuting a new production vehicle or concept car. They've driven a Jeep through a plate glass window... twice; showered the automotive press with so much confetti that we were pooping paper for a week; employed clowns, bands and B-list celebrities up the wazoo; and at the most recent Detroit Auto Show in January, drove a herd of cattle up the street for the debut of the new 2009 Dodge Ram . All of these big debuts are meant to attract media attention, and that they do very well. But the word from Chrysler LLC CEO Robert Nardelli is that the party's over. Going forward, Chrysler will tone down its debuts to focus on the products and save a bit of coin by nixing the big-budget theatrics. Sources inside Chrysler note that Nardelli and his right-hand man Jim Press aren't into the pyrotechnics, confetti and glass-breaking debuts that have made Chrysler press conferences...
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Filed under: Chrysler , Earnings/Financials Despite the fact that the beleaguered automaker has not yet turned a profit since its unceremonious departure from Daimler to Cerberus, Chrysler CEO Bob Nardelli says that the company is still on track. "Through the first quarter we are still on plan relative to the pro forma and the targets we established for 2008, in spite of some of the economic winds that are hitting us," he says. In order to turn last year's $1.6 billion loss into positive cash flow, Chrysler will be relying heavily on joint-partnerships like the one it just announced with Nissan (but probably not Fiat ) as well as with new and advanced engineering. Nardelli highlights interiors, upcoming technology integration and alternative powertrains as potential new incoming-generating features for their line of vehicles. [Sources: Automotive News / The Detroit News ] Read | Permalink | Email this | Comments
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Filed under: Plants/Manufacturing As Chrysler moves ahead with its "consolidation strategy" (a.k.a. Project Genesis ), it's apparently had enough foresight to realize that shutting down dealerships seriously handicaps your ability to service your customers. According to Steven Landry, Chrysler executive vice president of North American sales, the company's solution will be "stand-alone service stores" -- it is easiest to think of them as dealerships that have closed, but the service department still remains open. While the first stand-alone service store is still about two years from opening its doors, Chrysler is in active talks with a handful of other retailers about the strategy with customer service as their goal. "If we all of a sudden go from 80 stalls to 40 stalls we don't want to do our customers a disservice," says Landry. "You need to have the right number of stalls." Funny, any woman at a professional sporting event could have...
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Filed under: Chrysler Unfortunately for Chrysler's army of some 14,000 white-collar retirees, the automaker has announced that it will be cutting the free life insurance that workers were previously covered by. Those affected will be given a one-time opportunity to buy into the plan themselves, which offers coverage equal to their last year of pay if retired before 2003 or $50,000 for those who retired after the cutoff. They're also eligible for receiving a $4,000 bump in their pensions. Of note is that the cancelation does not affect any union-represented workers or retirees. Clearly a cost-cutting measure for the company, we're not sure how much it will actually save Chrysler per year, but apparently it's enough. Since those affected no longer work for the company, Chrysler knows that the move will not affect how its business currently runs, and since these workers aren't unionized, there's not much they can do about it, either. [Source: The Detroit News ] Read...
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Twenty-four year Chrysler employee Mike Donoughe has left the company after two months in his new post. Named to head Project D in January of this year, the program is creating new mid-sized cars that would replace the Sebring and Avenger and have actually have a chance against the Camcordimabu . Chrysler says that there was no conflict, but other outlets have reported that Donoughe clashed with CEO Bob Nardelli and so-called Acting Chief Innovation Officer Peter Arnell . Arnell is an outside marketing consultant who also worked with Nardelli at Home Depot, and apparently came up with the Celine Dion/Pacifica campaign (does anyone remember that?). Project D is tasked with developing Chrysler's next-gen midsize cars and also investigating ways for the automaker to be more competitive. (Not allowing demonstrably inferior product like the current Sebring and Avenger to ever see the light of day would be a great starting point.) We know Chrysler has the talent to get this right, it's...
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Filed under: Chrysler , Dodge , Jeep , UAW/Unions A key part of Chrysler LLC's agreement last year with the UAW gave the automaker the ability to hire new employees at a fraction of wages and health care of current workers. Since the deal was signed, Chrysler has been trying to show high-cost workers the door. The privately-owned automaker had a goal of 10,000 overall buyouts to cut labor costs, but it doesn't look like the Pentastar is going to get its wish. UAW Vice President General Holiefield told the Detroit Free Press that he didn't think Chrysler would hit its goal. Holiefield cited a shaky economy as the main reason workers haven't been pulling the trigger on deals that can range from $70,000 to $100,000 just for not working. The issue is once workers leave, there are few jobs available to provide new income. Although the deadline has passed for workers to accept packages, Chrysler isn't divulging the number of workers who have grabbed the deal. Chrysler is working...
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Filed under: Plants/Manufacturing , Chrysler Plastech supplied components like interior trim, engine covers, moldings, door panels, and floor consoles to Chrysler, Ford, GM, and Toyota. The company employed 7,600 people in the US and Canada, and had 2007 sales of $1.4 billion -- including a contract with Chrysler alone that was worth $200 million. Yet due to the rise in the cost of raw materials and lower consumer demand, the company, along with others like it in the past few years, was forced to declare bankruptcy last week. Chrysler terminated its contract with Plastech last Friday, and is now forced to idle four plants and eliminate an entire shift at another plant while it secures a new supplier. The move sends 10,500 Chrysler employees home. Chrysler hasn't said when it expects those plants to be open again, but workers will find out from plant managers or notices in local media when it happens. So far, no other company supplied by Plastech has indicated it will be slowing down...
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Filed under: Marketing/Advertising , Videos , Chrysler click above to watch the first commercial from Chrysler's new campaign Chrysler wants to get the message out that its listening to customers and responding quickly to improve its products. To that end, the privately-owned automaker is kicking off a new ad blitz this weekend with three commercials set to air in conjunction with the Super Bowl. The three ads you'll see this weekend are product specific and focus on the Chrysler 300, Dodge Charger and Jeep Grand Cherokee and Commander (the Jeep spot can be watched after the jump ), though there are a total of eight product specific ads that will eventually be aired during Super Tuesday programming, the Indy 500 and the Oscars. In addition, Chrysler's also got an animated cross-brand ad titled "Listen to You" (screen shot above and more in the gallery below) that shows a kid creating his own car company by, what else, listening to what people want. The whole campaign...
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Filed under: Etc. , Plants/Manufacturing , Chrysler Chrysler, LLC has announced that it's streamlining its product development process. For an as-yet-unnamed mid-size vehicle, Chrysler is creating a sort of central HQ that will house "every facet from design and marketing to engineering, including multiple dimensions within engineering including ride quality, interiors etc.," according to CEO Bob Nardelli. This new system replaces the old one where a number of departments spread over many geographical areas were utilized. The new program will have its own facility and be charged with creating mid-size cars for global markets, so we can perhaps expect the fruit it bears to be replacements for the Dodge Avenger and Chrysler Sebring. In addition to that, Chrysler is creating global, centralized "centers of excellence" for each of its brands to raise the standard of the products it already has out. To be located in countries like Mexico and China, these localized development...
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Filed under: Etc. , Marketing/Advertising , Chrysler Among what must be many options on the table, Chrysler, LLC is looking at strictly defining the three brands in its care, and shedding 1,000 dealers in the process. The idea would be to eliminate the practice of selling a Chrysler model as a Dodge model as well. Chrysler would sell passenger cars, Dodge would sell pickup and commercial trucks, and Jeep would sell, well, Jeeps and SUV's. From where we sit, it's not a bad idea, though it would give Chrysler a bunch of cars (and minivans) and leave Dodge rather few (Dakota, Ram, Sprinter vans?). That kind of rationalization, however, could allow Chrysler, LLC to additionally refine its dealer network and trim down inventory and, by extension, incentives. A decision could come by the end of the year. Another big question would be the shift it would take for consumers to join the party. Would a Jeep buyer really go for a Chrysler Charger, or a Jeep Aspen? And would a Viper by any other...
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