Fiat CEO: Chrysler worse than we thought

Fiat CEO: Chrysler worse than we thought
http://money.cnn.com/2009/09/16/autos/fiat_chrysler/index.htm?cnn=yes

Executives will present a revised business plan in November detailing
steps to recovery.
by Peter Valdes-Dapena, CNNMoney.com senior writer
Last Updated: September 16, 2009: 2:13 PM ET

NEW YORK (CNNMoney.com) -- The situation at recently rescued Chrysler
Group is even more dire than first thought, the CEO of Italy's Fiat --
which came to the aid of the U.S. automaker -- said Wednesday.

"We were surprised by how little had been done in the past 24 months,"
Sergio Marchionne told reporters in Frankfurt, Germany.

Chrysler will present a revised business plan in November, Marchionne
told reporters.

"We have to be absolutely clear about what we want to do with Chrysler
and, as a management team, where the organization is going to be in five
years," Marchionne said, according to the industry newspaper Automotive
News.

Unlike General Motors, which has continued to roll out new and
redesigned products even as it entered and exited bankruptcy, Chrysler
has had little to tout. Its most recent new market entries are the Dodge
Challenger muscle car -- essentially a re-bodied Dodge Charger sedan --
and the Ram pick-up.

The only new product Chrysler has entering the market this year is an
industrial-duty version of the Ram truck. After that, a new version of
the Jeep Grand Cherokee mid-sized SUV isn't expected until the middle of
next year.

Even if the Grand Cherokee is a terrific product, its timing is
unfortunate, said Michelle Krebs, senior analyst with Edmunds.com.

"The 2011 Grand Cherokee is an SUV being launched into a market that
doesn't favor SUVs," she said.

In terms of smaller cars and more fuel-efficient crossover SUVs, nothing
is expected from Chrysler in the near future.

Industry analyst Todd Turner of Car Concepts Automotive Research,
speaking from the floor of the Frankfurt Motor Show, found it difficult
to believe Marchionne's assertion that he didn't know how little work
had been going on at Chrysler.

"I'm a little surprised that he was surprised," he said.

More likely, Turner said, Marchionne is laying the groundwork for
drastic actions that will be announced in November but may have been
planned all along.

"That is that Chrysler is over, basically," he said of Chrysler's
flagship car brand. "Within five years, you're going to see nothing."

Chrysler also makes Dodge and Jeep vehicles.

Even if the Chrysler name survives, Turner predicted, the vehicles
marketed under that name will be Fiat products.

On the other hand, Marchionne may simply be enjoying his freedom to be
more honest now that the Chrysler deal is completed and laying the
groundwork to make himself and Fiat seem all the more like saviors.
suggested James Bell, market analyst for the auto Web site KBB.com.

"If they didn't come in as the proverbial white knight, Chrysler would
be going through liquidation right now," he said.

Chrysler had no comment about Marchionne's statement to the press.

In its deal to rescue Chrysler, Fiat took a 20% stake in the struggling
automaker in exchange for partnering with Chrysler on new products,
especially small and mid-sized cars . Fiat did not invest any cash into
Chrysler and, Marchionne told reporters, does not plan to do so now.

He said he hopes no outside investment will be needed as part of the new
restructuring, according to Automotive News.

Marchionne said he expects U.S. auto sales, industrywide, to total about
11 million vehicles next year. If demand doesn't go up to that level,
from the current level of roughly 10 million units, Chrysler may have to
close more factories, he said, according to the newspaper.

 

What a bone-head. All he had to do was to read the posts in this
newsgroup to know what was really going on at Chrysler.

Chrysler's problems started with the replacement of the LH platform with
the LX. You can't build a small, LIGHT, fuel-efficient car around the
LX. Again, you can blame the Germans at Daimler for that. As long as
they could stuff as much Mercedes content into Chrysler vehicles, and
made them look like Fisher Price Tonka Toys so they wouldn't compete
against Mercedes cars.

Why not at least mention the Caliber?

And yes, not offering a FWD option (at least a V6 FWD option) for the
Challenger was a completely moronic decision.

BRING BACK THE LH PLATFORM YOU ITALIAN WHACK JOBS !!!!

PUT THE 300N CONCEPT CAR INTO PRODUCTION !!!!

THE US MARKET WILL NOT BUY YOUR FIAT CARS BECAUSE THEY ARE COFFINS ON
WHEELS!!!

Fiat provided absolutely no money in this deal. So explain how they
were a "white knight". Makes no sense.

???

I thought Chrysler = Marchionne = Fiat.

So how is Fiat any sort of white knight? Did Fiat assume any of
Chrysler's debt?

 

Yeah, like people cross-shop Dodge and Mercedes. Next you'll be
saying people cross-shop Mustang and Ferrari.

Uh, it's not a new entry?

Because nothing says "pony car" like FWD.

That'll compete with Civic and Corolla!

Yeah, who cares about all those people buying Civics and Corollas?
What if GM is introducing the Cruze and Ford the Fiesta? What do they
know?

Because Chrysler had no products people want and no hopes of coming up
with any in the near future.

Didn't Chrysler emerge from bankruptcy with almost no debt? Wasn't
that the whole purpose of bankruptcy?

 

Does this look like a Dodge you fool:

http://www.newcharger.org/specs/00300NSpecs.html

That's what Chrysler would have been selling in 2003 or 2004 had they
not been acquired and gutted by Daimler. Cars based on the LH
platform. Cars with V8, RWD, Convertible as options. The replacement
for the 300m.

So don't be an ass and tell me that Daimler would have been happy if
Chrysler ended up selling that style of car.

The caliber went on sale in the spring of 2006 as a 2007 model. It's a
high-selling vehicle, and if it's not "brand new" it's certainly a very
recent model. Why you are being a bone-head and defending crappy
journalism - I don't know.

What a maroon. Nothing says "pony car" these days - certainly nothing
made by Chrysler/Dodge. Pony cars don't weigh 2 tons.

You're forgetting that all the "muscle cars" made in the 60's and 70's
had the slant-6 as an option (even if it wasn't FWD). That's eqivalent
to offering FWD today. Why would the Charger and Challenger even have a
V6 option today? Explain that you fool.

It was complete stupidity not to offer FWD as an option for the new
Challenger and Charger. Those big, heavy LX-bodied cars are useless on
snow - which a significant number of US/Canadians have to deal with at
least a few months of the year. If you want a mid-sized sedan, and you
HATE the tonka-toy look (and 2-ton mass) of the 300, but you NEED FWD,
then Chrysler/Dodge has nothing for you.

Better that then the Fiat-based micro-cars that are in the works. Those
won't sell at all in the US market.

WTF are you talking about? You think that people will buy the Fiat
micro-cars instead of Civics and Corollas? What are you smoking?

Ford and GM also have the mid-sized car segment covered, which is where
they actually make money. The Cruze and Fiesta don't compete with the
Civic, Accord, Camry, etc.

All Chrysler can offer is a 5-year-old sedan (the heavy, ulgy 300)
stuffed full of old expensive E-class Mercedes parts.

Chrysler could have brought back the LH body. Chrysler needs a better,
more economical and sane-looking mid-size car. The north american
market will not buy the small micro-cars that Fiat will supposedly
design for Chrysler.

And Chrysler won't even start to turn out those ridiculously small Fiat
cars until 2011. The partnership (or control by) Fiat will not give
Chrysler the products it needs to be profitable (small cars don't make
money) and it won't happen fast enough anyways.

That's my point. Chrysler's owners, investors and creditors got
screwed. Fiat has given Chrysler NOTHING except some vague idea that it
will provide a small car design that *might* be in production in a
couple of years. Now who's going to pay for the retooling for Chrysler
to build those micro-cars in North America?

What's really going to happen for the next 1.5 years is that Fiat is
going to siphon away any profits that Chrysler makes, charging it to
development and design expenses. Their real plan is to just make those
micro-cars in Italy or Mexico and badge them there as Chryslers.

Chrysler's real problem is their complete lack of an economical,
good-looking mid-sized sedan, and Fiat is going to make sure Chrysler
spends zero money solving that problem.

 

Because its kinda an embarrassment. What brain-dead manager decided to
replace the company's ONE compact economy car (the Neon) with an
underpowered (except for the SRT version) thing that looks more like a
crossover SUV?

Will you give that a rest? The LH was a fine vehicle and one of the
best I ever owned... but that was nearly 20 years ago. And the quality
of the LX has proven much better, whether or not you personally like it.

 

Steve,
We have had this discussion before. I agree with you that Chrysler
should have kept the two and four door Neon, but the Caliber is a good
car, kind of like the Lancer/LeBaron of the late '80's. I call it a
five door hatchback sedan, which to me, it is. Very comfortable, with
the CRT/2.0 very good mileage.

 

I love my 300M, but I would NEVER be interested in that 300N.

 

I like the mechanicals of the Caliber, but I'm not interested in driving
it in that thing of a body.

 

How unfortunate, but I expected it with Cerbus's stripping of Chrysler.

 

I agree 100% that this is their plan.

Mopar, the problem here is your talking about the future American car
market like it was the American car market of 6 years ago. It ain't, and
it isn't going to be for a long, long time.

I agree Americans love their big cars. But, you got to face some facts,
here:

1) Real wages in the US have been stagnant for the last decade, yet
inflation
has not slowed down. That means that today people cannot afford as
expensive a car as they used to be able to.

2) Right now we are in a depression and we are going to have a jobless
recovery. Meaning that more and more folks will be underemployed and
making less and less, thus real wages will slide. While it is true that
some
prices have slipped, they have definitely NOT slipped in health care.

3) the US population is getting grayer and when you get old you have more
medical conditions, and so as time passes a greater and greater percentage
of household income will go to medical - because people will be needing
more doctoring. And health care expenses are still skyrocketing.

4) gas prices are going right back up to where they were last summer. It's
taking longer but they aren't falling that's for sure.

5) Due to the banking crash all lenders today are scrutinizing loans of all
kinds with a fine tooth comb. Have you refinanced lately for example?
I did, using those really low rates back in March. The banker I closed
with told me that he is having almost as many rejections as applications
for refinancing.

6) The used car market is flooded and trade in prices have plummeted.

In summary, Americans are in no position to be spending the kinds of
money on "economical mid-sized sedans" over the next 5 years.

The name of the game will be CHEAP as in DIRT. Lots and lots of
people who would have bought a mid-sized sedan before are going to
be shoehorning themselves into an econobox micro car.

This is what happened back in 1979-84, and because the domestic
car companies wern't on the ball then, they let the imports capture a
large chunk of the market. It's happening now. Possibly in the future
the larger more expensive cars will come back. But for right now, the
name of the game is small, highly fuel efficent, and dirt cheap. All
car companies must figure out how to make money building those
kinds of cars, or they will be out of business.

Ted

 

Imagine the hard-top version, with 2 and 4 doors.

I like my 300m too, but that 300n is an extremely good looking car. You
should see the front pictures (I'm having a hard time trying to find
working links to more pictures of that car, and for some reason
allpar.com doesn't mention it in their chrysler concept car section).

Ok, here, check this out:

http://www.netcarshow.com/chrysler/2000-300_hemi_c_convertible_concept/

http://www.conceptcarz.com/vehicle/z256/Chrysler-300-Hemi-C.aspx

==================
http://www.autointell.com/nao_companies/daimlerchrysler/daimler57.htm

CHRYSLER 300 HEMI? C Concept Car

Return of the All-American V-8, Rear-Wheel Drive Luxury Performance
Convertible

DaimlerChrysler will unveil the Chrysler 300 Hemi? C concept car, a
four-passenger V-8 rear-wheel drive convertible, Sunday, January 9, 12
noon, at the Chrysler stand at the North American International Auto
Show in Detroit. The quintessential Chrysler, this concept combines
contemporary design, elegance, luxury and legendary Hemi-power. "This
vehicle explores a direction we might take if we were to return to an
all-American V-8, rear-wheel drive luxury performance car such as the
famed '57 Chrysler 300 C convertible," said Tom Gale, Executive Vice
President Product Development and Design.
=====================

http://www.caranddriver.com/news/car/00q1/chrysler_300_hemi_c_concept-auto_shows

The four-seat 300 Hemi C is Chrysler's modern-day version of the classic
rear-wheel drive American luxury performance convertible, the 1957 300
C. This 300 Hemi C concept car has a 5.7-liter V-8 engine with an
estimated 353 horsepower and a four-speed automatic transmission.
Chrysler estimated its 0-60 time at 5.9 seconds. In the flesh, the 300
Hemi C looks like a two-door 300M with its top chopped off, but in a
nice sort of way.

 

The Caliber sells well and that's what counts.

The interior quality, design and materials of the LX-300 is for shit
compared to the 300m.

Build quality might be the same - I don't know. I'm very happy with the
build quality of my 300m - even for a 10 year old car. The mechanical
quality is certainly outstanding.

And the 300n would have taken that to the next level.

 

Reminiscent of Lee Iaccoca's comment on arriving...

 

It's all in the eye! I, personally hate the style of the Fit, and told
a Honda dealer that. Also, my friend is a die-hard prewar Ford Fan:
Model A and especially the '40 Ford. I took him for a ride in my 1941
Chrysler Windsor, he drove it, and he says that it is a beautiful car.
He also chided me for having Fluid Drive instead of wanting a "real"
automatic, but after showing him how to drive it, he admitted it was a
smooth advance over the old Ford manual and even GM's first HydraMatic.
There are several cars that I would consider "that thing of a body":
the new Mercedes sedan body(the one that crashes through the glass in
the commercial), the Honda Fit/Element, that Toyota that looks like it
is a wannabe old school Land Rover, Cadillac CTS(horrible front end),
and there are others. But for my not liking them, their are others that
think they are great.

 

My point is not that the Caliber is necessarily a bad car (although I
still say the low-trim versions that I've had as rentals are pretty
shamefully appointed) but that it was a bad decision to use it to both
replace the Neon *and* cover an up-class niche too.

The Caliber is what it is... and that's a small-to-midsize
crossover/wagon/hatchback (however you want to visualize it). Its not an
economy car that can compete with Civics, Cobalts, Focuses (Foci?),
Scions, etc, let alone the new craze for Yaris/Fit sized things (which I
would *never* buy personally, but for which there is a growing market).
There's a big hole in the Chrysler lineup in that size vehicle and it
all goes back to not replacing the Neon.

 

August 2008 -- 19th best selling compact car

http://autos.aol.com/gallery/best-selling-small-car#

JUly, Aug 2009 -- not in top 10 at least

http://blogs.cars.com/kickingtires/2009/09/top-10-bestselling-cars-august-2009.html

Cash for Clunkers -- 8th (but for the first go-round, you had to buy a
car off a lot, and Civics and Corollas went quickly)

No, that's the equivalent to offering a 6 cylinder today.

For those who want image. A V6 is not the same thing as FWD.

You don't seem to understand -- you design a car for FWD or RWD. No
car anywhere, anytime, was RWD with FWD an option.

Like ... the old pony cars.

In a pony car? Neither does anybody else.

In a mid-size sedan? Avenger/Sebring are FWD with optional AWD.
Compass, Patriot, ...

They will sell as much as, say, the Mini or Yaris.

Fiat is only brining one small car, the 500. It's not much smaller
than a Mini. The later models, based on current Fiat cars, are more
the Caliber and Sebring sizes.

Like Sebring and Avenger.

Neither really do the 300 or Charger, or even the old Intrepid. Quite
a bit larger.

Or the Omni! The Accalim!

Again, only 1 -- the Fiat 500 -- is "micro" size. Fiat's lineup is
quite comprehensive -- they're a full-range maker in Europe, like,
say, VW.

That's true. Still, it's earlier than when Chrysler would have
brought out decent mid-size cars without Fiat, which is to say, never.

The alternative was to simply liquidate them in bankruptcy, you do
know.

Like GM's.

There IS no Chrysler -- it's part of Fiat Group.

Chrysler's profits belong to its owners -- Fiat Group. Does Chevrolet
"siphon away" Buick's profits?

Bringing back a 13-year old design seems to be your only solution for
that.

 

I was agreeing with a lot of what you said until these two comments.
Since when does a 20% share, with a planned growth in share to at most
35%, constitute "ownership?" There IS (for now) still very much a
Chrysler. Fiat Group owns one/fifth of Chrysler.

While I'm picking nits, the LH platform he's always touting is a 17+
year old design. It went on sale in the fall of 1992 as a 1993 model. I
bought one in the spring of 1993 and it was one of the best cars I've
ever had, and he is right in that it had SOME features that you can't
get anymore. For one thing, our 1993 3.5L Vision TSi routinely got 28
mpg highway and 23 mpg combined. Try THAT in a 3.5L LX platform with all
its added weight and pug nose aerodynamics. But for me, the fact that
the LH was a front-drive was a HUGE strike against it. With the power
the 3.5 had, FWD was wholly inadequate. Just like the 300-hp front-drive
Northstar Cadillacs handled like sh*t compared to the current rear-drive
CTS. And the LX chassis is indeed FAR more taut and stiff than the LH,
handles better in every regard, and has superior fit-and-finish.

 

Let's remember that the Grand Caravan/Town & Country are
still selling above expectations. They are the only NA made
minivans and still the perfect choice for the large family.
Not to mention that they are great choices for inside mount power
wheelchair lifts, along with total conversion (dropped floor pan)
wheelchair vans.

 

Since one has dodgy maths.

DAS

To send an e-mail directly replace "spam" with "schmetterling"
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[...]

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When did Alabama secede from NA? 'Cause the Honda Odyssey is made
right here in Lincoln, Alabama.
Also, when did Indiana secede? The Toyota Sienna is made Princeton,
Indiana.

In fact, since the Chryslers are now made only in Windsor, Ontario,
the Honda and Toyota are the only minivans made in the US.