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Chrysler was the last of the not-so-Big Three to reveal their plan for long-term viability with an ask of $11 billion to sustain operations into the new year. But for what? As recently as September, Chrysler said they had seven-to-nine new models for 2010. For the life of us, we can't figure out what those vehicles are considering the company's stopped development on every single product line. Are they talking about the Chrysler EV electric car family? Because seriously, that's smoke and mirrors. There's nothing new coming out of this company at any time in the next year. But hey, Chrysler CEO Bob Nardelli also pledged to take a $1 salary and no kind of health or insurance benefits until the crisis is resolved. Well, he's earned it. Because once you get past the huge $11 billion number and the fact that they're apparently going to be forced out of business in January without it, when you take a look at the automaker's plan, there isn't much in the way of...
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On top of yesterday's news Chrysler plans to shut down the Delaware SUV plant that makes the Dodge Durango and Chrysler Aspen a year early is news this morning the automaker plans to cut 25% of their 18,500 white collar staff starting next month. In his memo to staff announcing the cuts, Chrysler CEO Bob "The Builder" Nardelli outlined the Cerberus-owned company's need to deal with these "unimaginable times" — which we've determined is another way of saying " Financiapocalypse " — as the reason for the cuts. Nardelli also outlined a need to cut discretionary and overhead expenses and reduce capital expenditures not related to major products. Hmm, all of this sounds eerily similar to the rumors we heard last week. Well, the job losses part anyway. Full text of the note from "Bob" after the jump. Seriously, that's how he signed it — "Bob." Seriously, we can't make this stuff up. A message to employees...
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The WSJ reports today (via Automotive News) Cerberus and GM are moving full-steam-ahead in their efforts to get a GM-Chrysler deal done by the end of October. Today also brings news Renault may have their hand in the cookie jar too, negotiating for one or more parts of Chrysler and leading to speculation the Auburn Hills, MI-based automaker could be divvied up among several companies: Basically the worst-case scenario envisioned when Cerberus Capital Management took over in 2007. Finally, we've got an unsubstantiated rumor engineering employees at Chrysler may be getting two months off sans pay beginning...drumroll please...November 1st. Coincidence? Maybe. Also, David Faber of CNBC had a chance to sit down with ChryslerCo CEO, Bob "The Builder" Nardelli; while we haven't had a chance to run through it in its entirety, hit the jump for the a full transcript of the CNBC interview with Nardelli. UPDATE: We now hear from a Chrysler source that rumors of an engineering furlough...
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Daimler was obviously unimpressed by Chrysler's electrically motivated press reveal yesterday, as word comes today the German automaker is in talks to sell Cerberus its remaining 19.9% stake in Chrysler. If terms are agreed upon, the sale would mark the end of Daimler's involvement in the Auburn Hills automaker a mere ten years after embarking upon its much ballyhooed "merger of equals." The two companies are mum on the price Daimler hopes to get for its stake in Chrysler, but we'll bet it's worth at least $105 million less than it used to be. [ Automotive News , (Sub. Req.)]
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While we've previously reported on the Chrysler/Nissan small-car/pickup-truck mind meld, the Wall Street Journal now says the two companies are discussing collaboration on a mid-size vehicle platform. The report states that the agreement currently under consideration would have Nissan building mid-size sedans that Chrysler would then market under its own nameplate in the US. There's no specific mention of a platform or nameplate likely to be used, but it's not hard to speculate that the much-maligned Sebring could be replaced by the end result of such a collaboration. Jalopnik Snap Judgment: Anyone complaining about Chrysler's lack of upcoming models isn't paying attention to the news. The company appears to be actively seeking tie-ups, particularly with Nissan, that will provide it with fresh new vehicles without having to actually engineer and build them. It's as if Chrysler is moving toward a future as a vehicle marketing company rather than an actual auto manufacturer...
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The Detroit News reports today on the marriage of Chrysler and Cerberus Capital Management, which took place one year ago this week. Robert Nardelli, former head of Home Depot, beat out Tom LaSorda and Wolfgang Bernhard for the top job at the new Chrysler, joining an already troubled automaker just at the edge of what would become the country's worst auto sales period in 20 years. What the hell was he thinking? More importantly, what's he thinking now? A Chryslerberus freshman report card after the jump. Sales: D Under Nardelli and Cerberus, Chrysler has only topped DaimlerChrysler year-over-year sales numbers in one month: December, 2007. So why not a solid "F?" Because product that the new Chrysler management team had any control over the design of is only now coming to market. What they've done with their inheritance has not been impressive, but what happens in the next 12 months is going to be a more accurate assessment of Chrysler's new sales strength. Product...
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Chrysler July sales dropped below the 100,000 unit mark as consumers began to show signs that they've lost confidence in the company, reports Automotive News . While Chrysler's announcement that it would suspend leasing August 1 caused a last-minute flurry of shoppers, more ominous was a report by Complete.com that Chrysler's June "shopper count," its number of online product inquiries on major automotive Web sites, fell to the company's second-lowest on record. Hmm; loss of customer interest and no leases. Where could this be going? Jalopnik Snap Judgment : Though Chrysler's last-minute leasing bubble looked good on paper, the net effect will be to front-load shoppers, not unlike the GM "employee pricing for everyone deals" from a few years back. Combined with news of the lack of product research being conducted by potential buyers, the bad news for Chrysler is that everyone who may have been interested in driving a Chrysler probably picked one up...
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The Jeep Compass (the Jeep MK platform for the ladies) and Patriot (the Jeep MK platform for the boys) will be getting revised interiors with softer lines for 2009, according to a first look at some Mopar dealer catalogs scanned by the Chrysler forum fan-boys at Allpar . Gone are most of the hard-edged "plastic box" features that made up the first-gen mini-Jeeps, replaced by a more fluid-looking motif still using the same basic layout. Compass pictured above; Patriot interior after the jump. We're going to assume that, since this came out of a Mopar accessory catalog, the photo depicts seat warmers. But with Chrysler's interior track record, we're not ready to declare anything for certain. Jalopnik Snap Judgment: Two things to think about: First, Chryserberus is obviously listening to consumer complaints about its interiors. Second, if Compass and Patriot are getting a refresh, ecxpect Caliber to get one as well (if it survives), possibly vaulting the three (or maybe...
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Come Halloween, Chrysler will idle its St. Louis South minivan plant indefinitely. And, just so the 1,500 employees at St. Louis South are clear about the meaning of "idle indefinitely," co-president Tom LaSorda said, "We see no intent to rerun this plant. We're idling it and it will likely be fully closed." The plant was down to one shift already; after the closure, Chrysler will source the Grand Caravan and Town & Country from its Windsor, Ontario minivan plant. Additionally, on Sept. 2, the St. Louis North truck plant will be pared down to one shift, resulting in about 900 layoffs. Chrysler had spent approximately $800 million in plant improvements to the two facilites over the past two years, so look for Cerberus to increase the price of a Town & Country Limited from $36,755 to $288,995 in an effort to recoup costs. Union leaders speculate that some of Chrysler's decision was based on political circumstances, as both St. Louis facilities voted down...
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The new Dodge Challenger is hitting showrooms. The 2009 Dodge Ram launch is scheduled for fall. But it's the sounds of silence after that when it comes to product. What's going on? One influential industry study, the Merrill Lynch "Car Wars" report (yes, that's it's real name), states Chrysler's lack of new product may be a deliberate effort on the part of owners Cerberus Capital Management to thin the herd in advance of a breakup and subsequent sale. In an excerpt that again proves financial analysts are paid by character count , the report says, "Chrysler's product pipeline severely lags the industry on a number of key metrics, which is an ominous sign for its market share. We believe that this is an active decision by new owners to rationalize the product portfolio in advance of a breakup/sale." Cerberus, of course, is denying any such plans, stating that, "We have a model that is buy, fix and hold." Uh-huh. Didn't Gordon Gecko...
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Former chairman Lee Iacocca gave a closed pep rally to Chrysler employees yesterday in Auburn Hills, once again sharing the stage with a K-car , a minivan ...and rumors of Chrysler's imminent bankruptcy. While current CEO Bob Nardelli was praising Iacocca as "Chrysler's most dynamic leader" and "a great American," Chrysler spokesman David Elshoff was telling reporters that rumblings about a forthcoming bankruptcy filing by the automaker were "without merit." Presumably addressing the present state of the industry, Iacocca said, "We'll live through it. Don't panic. Things are going to be OK." To fix the current management problems, Iacocca suggested outfitting Nardelli with wire wheel covers and a vinyl landau roof, then sending him back into the boardroom and hoping everyone would think he was a totally new CEO. The bankruptcy rumors seem to have sprung from reports this week that Chrysler drew down on a line of credit from Daimler...
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As further evidence that Cerberus bit off far more than it expected with its purchase of Chrysler last fall, an internal memo revealed to the Free Press shows that the last few months have been even worse than Chrysler expected. In fact, June numbers are showing an industry-wide disaster looming, with total U.S. vehicle sales down 7 percent in April, 8 percent in May, and on pace to drop 20 percent in June to an annualized rate of only 12.5 million. The memo didn't specifically mention any additional cuts at Chrysler, but CEOs don't generally send e-mails warning of a looming industry crisis just before announcing across-the-board raises. Attempting to close on a high note, Nardelli said "We have great vehicles to sell. And keep talking up our products to your family, friends and neighbors." Unfortunately, most of Chrysler employees' family, friends and neighbors are grappling with their own layoffs and foreclosures, so putting a new Sebring in the garage isn't...
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Cerberus Capital Management is not second-guessing its 2007 purchase of Chrysler from Daimler, and the the business is "on track," Chrysler LLC CEO Robert Nardelli said Tuesday at a Wall Street Journal press conference. Nardelli has been facing speculation that Cerberus got in over its head with the Chrysler purchase, particularly in light of U.S. sales that are down 25.4 percent in May and 19.3 percent for the year to-date compared with the same period a year ago. We suspect Cerberus is speculating that Nardelli got in over his head when he took the top spot. Not surprisingly, Nardelli said that Chrysler might have to "go back and resize" production plans. He also reiterated his expectation that Chrysler would remain a private company, explaining that there were clear advantages to running Chrysler under private equity ownership rather than as a public company. For example, not having to tell reporters a damn thing except, "we are guarded but optimistic. We are...
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Apparently answering today's QOTD with a "hell yes," our friends in Auburn Hills have tied the super-best automaker from the Land of the Rising Sun in at least one category: Most productive manufacturer, according to this year's Harbour Report. What does that mean? That Chrysler assembles a vehicle in 30.37 hours on average, exactly the same figure reported by Toyota. How'd they do it? Outsourcing! Chrysler's Toledo Supplier Park was named North America's most productive assembly plant, slapping Jeep Wranglers together using just 13.57 labor-hours. But who's actually doing the work? The Toledo Supplier Park uses Kuka Group (Augsburg, Germany) to manage the body shop, Magna Steyr (Graz, Austria) to manage the paint shop and Hyundai Mobis (Seoul, South Korea) for chassis assemblies. Somewhere, Lee Greenwood is weeping softly. [ Automotive News (sub. req.)]
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Cerberus has just issued, via Automotive News , a denial of the Financial Times' claims that it's just sold over half its stake in Chrysler . "Cerberus has not sold any equity in Chrysler," said the Chrysler official speaking on condition of anonymity. "There are always co-investors at the time of the transactions so when they originally purchased 80.1 percent of Chrysler, there were co-investors at that time. They still own 80.1 percent." The full release follows the jump. DETROIT — A published report today saying Cerberus Capital Management LP has sold more than half its stake in Chrysler LLC is not accurate, a senior Chrysler official told Automotive News today. "Cerberus has not sold any equity in Chrysler," said the Chrysler official speaking on condition of anonymity. "There are always co-investors at the time of the transactions so when they originally purchased 80.1 percent of Chrysler, there were co-investors at that time. They still...
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