Consultant: GM merger would eliminate most Chrysler vehicles

Consultant: GM merger would eliminate most Chrysler vehicles
http://tinyurl.com/642x2f

Automotive News
October 30, 2008 - 2:50 pm ET

DETROIT -- A merger between General Motors and Chrysler LLC would result
in the closing of as many as half of Chrysler's factories and the
elimination of all but seven of its core models, according to a report
by consulting firm Grant Thornton LLP.

A deal also could result in a loss of 100,000 to 200,000 jobs at
automakers, suppliers and other industry stakeholders, said Kimberly
Rodriguez, principal of Grant Thornton's automotive practice.

Rodriguez said negotiators may reach an agreement in principal as soon
as Tuesday, Nov. 4. Reuters reported yesterday that GM and Chrysler's
owner, Cerberus Capital Management LP, have resolved major issues and
the final form of any accord will depend on financing and U.S.
government support.

"Chrysler as we know it will cease to exist very soon," she said at a
briefing with reporters today in suburban Detroit. "There are few
options available to either company."

The blended companies would command about one third of U.S. auto sales.
"Despite the significant number of families that will be impacted, the
benefits of combining the two companies are both structural and
strategic," Rodriguez said.

Surviving Chrysler vehicles would likely be the Dodge Ram pickup;
Chrysler and Dodge minivans; and several Jeep models, including the
Wrangler and Grand Cherokee.

 

Why would GM keep a third line of pickups? And the slowest-selling
one? And GM is talking about selling Hummer -- why would they want
another line of SUVs?

Face it, selling Chrysler to Nissan would be better for the survival
of Chrysler as a car maker.

 

There must be something else going on, maybe there is some sort of
bailout deal that they are being promised if they keep the companies
American. There isn't a single car in the Chrysler line up that doesn't
already have a GM equivalent.

One more thought, there is a curse on Jeep, every company that's owed it
has died,

Willys
Kaiser
AMC
and now Chrysler

 

The Dodge Cummins Ram is a top seller. They won't destroy that line.

Jeep Wrangler has no other vehicle in its market.

Town and Country is one of the best selling of its class.

 

Cummins can't be replaced by Duramax for a decent sized market.

Wrangler has zero GM equivalent or anything marketed by any major
automaker competing against it.

GM doesn't have a Challenger competitor unless you count the STILL
unreleased new Camero. Even still, IMHO the Challenger is the better
classic reborn muscle car.

 

One word: Cummins. The Dodge has dominated the "real working" truck
market with that engine, and for good reason. Its far superior to the
duramax and Navistar (Ford) in every measurable way, from reliability to
emissions to power to noise. OK, a few more words too: the new Ram
pickup is a significant technological advance over the previous model,
and again is a superior design to the GM trucks. Some people will never
buy a Dodge branded truck, though, so keeping the GM around for the
low-end and weekend worker trucks makes sense.

Because, again, Jeep vehicles are superior vehicles (especially the
Grand Cherokee and Wrangler, the latter remains the only vehicle of its
type on the market by ANY manufacturer) and they with better name
recognition and more POSITIVE name recognition to boot. Hummer is a
laughingstock among such diverse crowds as hardcore offroaders and
hardcore environmentalists. It should die. Now. Even if GM doesn't get
Jeep, its an albatross around GM's neck.

For the second time in recorded history, I completely agree with Lloyd.

 

Yes, the "Jeep Curse" has been well documented. Although it should be
noted that AMC and Chrysler each lasted nearly 30 years with the brand,
so its not one of your fast-acting curses ;-)

What amazes me is that ANY company that owns Jeep could possibly fail,
because the things sell at an incredible rate. Said companies are always
foiled by bad decisions on OTHER vehicle lines, not Jeep itself.

 

from what I'm told the duramax is an Isuzu engine anyway

 

Renault is still alive (just not in US market).

 

Sure it can. That's not a huge market anyway, especially in this
economy.

But do its sales numbers justify keeping producing it?

300 hp V6 in Camaro vs 250 in Challenger? Camaro lighter as well? V8
as much hp as Challenger SRT-8 for (projected) cost of Challenger R/T?

 

This is what I'd see with a Nissan tie-up:

small car -- Nissan Sentra for Nissan, Sentra platform for Chrysler
(replacing Caliver)
mid-size car -- Nissan Altima for Nissan, Altima platform for Chrysler
(replacing Avenger/Sebring)
large car -- Charger/300 for Chrysler (Infinity covers premium and
large for Nissan)
minivan -- Caravan/T&C for Chrysler, minivan on that platform for
Nissan (replacing Quest)
mid-size SUV -- Grand Cherokee for Chrysler, Pathfinder for Nissan
smaller SUV -- Xterra for Nissan, Xterra platform for Chrysler
(replacing Liberty/Nitro)
small crossover -- Rogue for Nissan, Rogue platform for Chrysler
(replacing Compass/Patriot)
off-road SUV -- Wrangler for Chrysler
large pickup -- Ram for Chrysler, Ram platform for Nissan (replacing
Titan)
small pickup -- Frontier for Nissan, Frontier platform for Chrysler
(replacing Dakota)
mini car -- Nissan Versa (maybe Versa platform for Chrysler)
dead: Aspen, Durango, Commander, Armada, PT Cruiser

 

Its a joint effort between GM and Isuzu Diesel.

 

Wrong way to look at it Lloyd. In a bad economy, the HD truck segment
remains constant. People that haul heavy things with trucks HAVE to keep
buying trucks, and that market prefers the Dodge/Cummins. Its people
that buy, for example, the Toyota Tundra as a status symbol and to haul
the occasional potted plant home from Lowes that will abandon the truck
market.

Go look at said numbers. They're quite large.

 

Well now we disagree somewhat. I see Nissan getting COMPLETELY out of
all truck and SUV production because the ones from Chrysler are already
better, especially with the Aspen/Durango hybrid on the way. Nissan just
isn't very good at making trucks and vans. Never has been.

The Caliber is a more of a small crossover. See below.

My take: Chrysler replaces Infiniti altogether. The G35 might remain
re-badged as a Chrysler since its common with the 350z. Challenger stays
in production to kick the Camaro around, which it does rather
resoundingly from what I've read of early comparisons.

100% guaranteed. Nissan has proven they can't build a minivan no matter
how many times they try.

Pathfinder = dead along with all other Nissan truck platforms, Grand
Cherokee platform re-badged for Nissan.

The latest Xterra is actually a very large platform, comparable to the
previous-generation Durango. I think its dead along with all Nissan
trucks. No replacement.

Compass/Patriot is the same plaform as the Caliber, so the Rogue
platform just vanishes and all these go on either an updated Sentra or
Caliber platform. Doesn't matter much which.

Not if I'm right and Nissan quits building all trucks. The Dakota
plaform then becomes the Frontier for Nissan and remains for Dodge.

Aspen/Durango platform gets rebadged for a Nissan model and includes a
hybrid option already in the works, which is NOT in the works for any
Nissan.

 

But the prime market -- contractors and the like -- are out of work
and many are going bankrupt.

 

Sales are so slow, Chrysler is closing plants. And the hybrid really
doesn't do much -- it's in an old, truckish vehicle that rides and
handles like a truck, when the market is moving to crossovers.

It's sold as an econocar. And it's Chrysler's only small car.

Never. The Chrysler name doesn't have the cachet. It once did, but
it's been cheapened by too many Sebring, LeBaron, Cirrus, PT Cruiser,
etc. models. It's now more like Mercury.

No, you're thinking of the Armada maybe? Xterra is 178 in long.
Liberty is 177 in.

Nah. The Sentra is a much better platform than the Mitsu Lancer,
which is what the Caliber, Compass, and Patriot are based on.

Dakota is, unfortunately, too old and too big for a compact truck.
And not economical enough.

Actually Nissan has a hybrid Altima.

And Durango/Aspen are gone: From Edmunds: The Chrysler Aspen (right)
and Dodge Durango (below) full-size hybrid sport utility vehicles have
become the first green vehicle casualties in the wake of the
automotive industry's declining fortunes.

Chrysler announced today that it will close the Delaware plant where
the SUVs and their nonhybrid namesakes are made and discontinue the
models. (dated Oct. 23, 2008)

The Auburn Hills, Michigan, automaker won't move their production
anywhere else when the plant closes at year's end, Chrysler spokesman
Scott Brown told Green Car Advisor, despite the fact the hybrids
entered full-scale production on Aug. 22, barely two months ago.

 

Chrysler destroyed Jeep. No longer can Jeep be associated with tough,
rugged, built for off road adventures etc. Seems they just took a
typical car or SUV, changed the body a tad and called it a Jeep. Even
the Wrangler is a far cry from how the CJ etc. series were built.

 

Wrong. Cummins is a large market. The name sells. The Duramax name
doesn't hold much sway like Cummins does. Take a look at the Ford work
trucks that have the Cummins in them.

Yep. Wrangler is still popular after all these year. Nothing else like it.

First off you can't buy a V6 Challenger at last glance at my dealer.
Only the SRT-8. The Camaro never had the muscle car status that the
Challenger did and I feel that continues with the new models. Second,
the Camaro is still unreleased with only preliminary specifications
stated. GM has a history of bloated wishful vapor specs.

 

Crossovers can't do what the Durango can. I can take 7 people
comfortably while pulling my 6,000lb trailer. I need such capabilities
and did not want to go to the size and expense of a Suburban. The
desire for such vehicles is still high. It was high gas prices that
hurt the demand for them, but the desire still exists. As gas prices
continue to plummet you'll see mid sized hauling capable SUV's rise again.

 

News story:

It's not like the domestic automakers need more worry, but another of
their sacred cash cows, the diesel-powered medium-duty pickup, is
being slaughtered.

The Detroit Three's "heavy duty," commercially oriented three-quarter
ton and one-ton pickups have long been outsized profit centers,
largely because their buyers are famously wedded to diesel engines, an
expensive option loaded with profit margin.

The industry's overall pickup business already is enduring a well-
publicized battering - but now, inflated diesel fuel prices have the
historically diesel-favoring heavy-duty customer - those who are still
buying, that is - fleeing for the comparative comfort of engines that
use $4 gasoline instead of $5-plus diesel.

How bad is it?

Diesel's portion of the heavy-duty pickup "mix" has consistently run
at 70 percent or better, on average, for General Motors Corp., Ford
Motor Co. and Chrysler LLC. Chrysler, for one, has had diesel
penetration rates approaching 90 percent for its Dodge Ram Heavy Duty,
which has exceeded 80 percent diesel share since 2005.

Now, however, those numbers are beating a hasty retreat: in May, the
ratio of Ford Super Duty Pickups sold with a diesel engine stood at
just 51 percent - during the same time last year, the Super Duty
diesel take rate was 71 percent.

Looking at January-to-May sales periods for heavy-duty variants of
Chrysler's Ram, diesel-engine share reached a high point of 88 percent
in 2006, and was 87 percent in 2007. For the same period this year,
diesel-engine sales for Ram Heavy Duty are down to 82 percent, while
overall Ram Heavy Duty sales are off by 38 percent

Not the question. Considering labor, plant costs, etc., is it
profitable?

You can for 2009. SE with 3.5 V6 and R/T with 5.7 V8. Don't know the
intro date, but they've been announced (and are on Dodge's web site).

Simply untrue. Z/28 means something. SS means something.

GM started taking orders on Oct. 13. More info:

http://www.autoblog.com/2008/10/13/2010-chevrolet-camaro-priced-ls-22-995-ss-30-995/print/

LS model with 300-hp, $22,995. Challenger SE with 250 hp is $25,340.
Camaro SS with 422-hp V8 is $30,992. Challenger R/T with 372 hp is
$30,545; SRT-8 with 425 hp is $42,245.