Would You Buy a Car from Chrysler?

Note the next to last paragraph about Fiat quality (or "quality").
R.I.P. Chrysler.

Would You Buy a Car from Chrysler?
http://tinyurl.com/dlxqvc

Persuading buyers to take a chance on the bankrupt automaker might turn
out to be tougher than working Chrysler out of court

By David Kiley

Now that Chrysler has done what was once unthinkable for Detroit's Big
Three carmakers—filing for Chapter 11 bankruptcy reorganization—everyone
from President Barack Obama to the automaker's own public relations
department has tried to assure car owners and would-be buyers that the
company is going to continue operating and that its warranties are safe.
But the question for consumers is, should I buy a Chrysler now? And how
about one of those Fiats I hear are coming to America?

Consumers can be spooked by the idea of buying from a bankrupt company;
many equate bankruptcy with "closing the doors." Car-buying site
Cars.com says 21% of consumers it polled said a bankruptcy would affect
their decision on which company they would buy a car from.

So Chrysler and its dwindling army of dealers know that the job of
selling cars just got a lot tougher. They will have to do a lot of
advertising and communicating in the next 60 days to keep people coming
into showrooms.

"They should shout from the mountain tops in ads and every other way
they know how that they are here and not going anywhere," says Jason
Vines, former communications chief at Chrysler as well as Ford (F), who
has dealt with several public relations crises. "Now is not the time to
be shy."
The Quality Problem

Even before this, talk of a bankruptcy filing had been hammering
Chrysler's U.S. sales. They are down 46% so far this year, worse than
the 38% decline for the industry. Part of that, of course, is the impact
of the recession and scarcity of consumer credit. But it is hard to feel
good about Chrysler's vehicles based on the independent data available
on reliability and quality. Consumer Reports, for example, recommends no
Chrysler, Dodge, or Jeep vehicles in its auto guide this year. Nor does
J.D. Power & Associates (like BusinessWeek, a unit of The McGraw-Hill
Companies (MHP)) have great things to say. It rates Chrysler's vehicles
considerably lower on quality than rivals and industry averages.

Worse, J.D. Power also scores Chrysler very low in its Automotive
Performance Execution & Layout Study, which surveys buyers on how well a
vehicle is executed and designed after they have lived with it a while.
All three Chrysler brands score well below the industry average. Several
of Chrysler's key models—Chrysler Sebring, Jeep Liberty, and Grand
Cherokee—score at or near the bottom of each category. All three brands
also score well below average on Power's Vehicle Dependability Study,
which measures how reliable vehicles are over three years of ownership.

Chrysler executives says that it takes time for any improvements in cars
to be proven. "We have made great progress in the nearly two years we
have been working at it, but it takes time for these improvements to be
reflected in the scores," said Chrysler Vice-Chairman James Press in a
recent interview with BusinessWeek.

One worry that automakers have about bankruptcy—that buyers will assume
no one will be around to fix their car—should be allayed by the fact
that warranties on Chrysler products have been guaranteed by the U.S.
government since Mar. 31. That continues through the Chapter 11
bankruptcy process. Since the company is virtually assured to reemerge
from bankruptcy as part of a new company combined with Italian automaker
Fiat, warranties will continue to be honored by Chrysler and the new
company that emerges from bankruptcy without the government having to be
involved.
Bargain Hunters, Start Your Engines

If car shoppers are still interested, they'll find plenty of deals. The
clouds of bankruptcy over Chrysler and General Motors (GM) have greatly
reduced demand. As a result, leading car-shopping site Edmunds.com says
the average discount being offered on Chryslers, Dodges, and Jeeps is
about 23% off sticker, vs. an average of 16% for the rest of the industry.

It's not impossible to find discounts of more than $10,000 on Chrysler
minivans and SUVs, as well as Dodge pickup trucks that dealers are
trying to clear from their lots. Older car models, such as the Chrysler
PT Cruiser and Chrysler 300, are also seeing discounts of more than
$5,000 at some dealerships. But those heavy incentives may dry up soon
as Chrysler idles its production plants while it is in bankruptcy
reorganization.

"No one can blame car buyers who shied away from brands that were
mentioned in the same breath as the word bankruptcy," says Edmunds.com
consumer advice editor Philip Reed. "[But] now that their warranties are
being guaranteed, Chrysler and GM vehicles are good deals that are worth
considering."

Let's say, though, that a consumer is wowed by the design of a Jeep
Grand Cherokee or Chrysler 300 and wants to take advantage of the huge
incentives. The next question might be whether their dealer is going to
be around to service it a year from now.
More than 1,000 Dealers May Disappear

Forty-five Chrysler dealers went out of business in April, and more will
be shuttered in the weeks ahead. Under Chapter 11, Chrysler can cut
dealers without worrying about repercussions from state franchise laws.
The company has about 3,150 dealers and is said to want to cut as many
as 1,200 to 1,500 of them in markets where too many are competing for
too few sales.

So the dealer that is 15 minutes down the road might be gone in a matter
of months, with a dealer 45 minutes away the closest to service a
vehicle. Other repair shops can perform warrantied repairs, but many car
owners prefer to have service done at the dealer where it was purchased.

Earl Hesterberg, CEO of Group 1 Automotive, a company that manages
dealerships of several manufacturers, including Chrysler, says a lot of
local dealer advertising, combined with the company's national
advertising, will need to make the case that buyers don't need to worry
about being abandoned. "The good news is that the brands have a future,"
said Hesterberg.

Is there an argument to be made for waiting to see what Fiat brings over
to sell in Chrysler showrooms, or even longer to see what new vehicles
the combined company comes up with?

Unfortunately, Fiat suffers from some of the same quality problems as
Chrysler. Fiat models do not score high for quality and reliability in
Europe and South America, where they are sold now. Fiats and Fiat-owned
Alfa Romeos sold in Europe are near the bottom in reliability and "need
to improve significantly to move away from the foot of the table, where
they have languished for several years," says U.K.-based Which?, a
consumer advice publication similar to Consumer Reports in the U.S. A
survey of people who owned Fiat models in Britain, by J.D. Power and
magazine What Car?, put Fiat last of 28 brands in a 2008 Customer
Satisfaction Index for two-year-old vehicles. Quality and reliability
count for 30% of the score.

For now, Chrysler has found refuge. But it's not clear how its new
partner will make its future any more promising.

 

At least the Alfas don't rust on the assembly line anymore...

When I was arranging a car hire at the Avis Milan airport station (to ensure
I got an Alfa) I asked the manager what he thought of Alfa and what he
drove. He said he would never buy an Alfa and he had an Opel (GM) of some
sort.

Every petrolhead would love an Alfa but few -- in Britain at least -- risk
it. I have driven an Alfa 147 twice on hire (among the lakes of northern
Italy - lovely). With a lively 1.9-l turbodiesel engine and great looks it
was terrific. Even more so as I did not have to worry about the costs of
any mechanical failure...

I understand Fiat quality has come on a long way but, I suppose, has that of
just about every other major brand.

Presumably a problematic reputation on reliability kept them off the US
market. Now they want to buy a chunk of a big but bust company in a country
about which they know nothing... I wonder what the last shareholder meeting
was a like...or is it another case of megalomaniac management thinking it
can do better?

DAS

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

[...]

 

I don't think it's any harder to sell a Chrysler today then it was three
months ago. They've been bankrupt since last year, filing formal
bankruptcy papers doesn't change a thing. If I were in the market for a
new car today I wouldn't be looking at either Chrysler or GM, frankly I
don't think I would look at anything other than a Toyota or a Honda
because they are the two companies that are least likely to go out of
business while we are in this depression. The key for Chrysler is to get
through the bankruptcy reorganization as quickly as possible and to come
out of it with a structure that looks convincingly viable. On top of that
they are going to need another Lee Iaccoca, if they don't have a super
salesman like Iaccoca at the helm to convince people that they are
selling great cars they will be right back in bankruptcy, and it will be
Chapter 7 not 11.

 

There are three main reasons I would not buy a new Chrysler - and it has
nothing to do with any of the reasons cited:

(1) It's a matter of personal protest of how this all was handled so
unnecessarily with taxpayer money and government takeover, and the bad
business plan will continue to be propped up with more taxpayer money
when it can't make it on its own (due to (2) and (3) below).

(2) In the bankruptcy agreements, rather than the normal give and take
of bankruptcy proceedings, the government will force its hand to
leverage against creditors while favoring unions and keeping the
albatross of past union agreements around Chrysler's neck putting it at
a huge competitive disadvantage, except that disadvantage will be offset
in the future using even more taxpayer money (either printed or borrowed
from our progeny for several generations) as opposed to free market
pressures.

(3) I can't imagine a worse scenario than the government micromanaging a
"for-profit" (in this case a poor choice of words, but I only use that
term in distinction from a "non-profit" in the legal sense) company (the
plans to force them to market a car that the consumer is simply *not*
going to buy being one example of that). It would not be viable in a
free market, and, again, the gross deficiencies will continue to be
subsidized by printed/borrowed tax money well into the future.

 

I fi were in the market for a domnating car with character I would but
a Charger or Challenger. (While they're still around?)

 

Bill Putney wrote in message: "while favoring unions and keeping the
albatross of past union agreements around Chrysler's neck putting it at a
huge competitive disadvantage, except that disadvantage will be offset in
the future using even more taxpayer money (either printed or borrowed from
our progeny for several generations) as opposed to free market pressures.'

Although the government did this prior to the bankruptcy filing it
ultimately will be up to the bankruptcy judge to sign off on it. The judge
has the power to null and void the union contracts and wipe out what they
fought far all theses years.

It would not surprise me that the biggest thing that hurts all the big 3
automakers is it retirement program that was negotiate when times were good.
It would not surprise me that Chrysler does not go to court and request to
drop the pension to save money and turn it over to the PBGC (Pension Benefit
Guaranty Corporation).

The UAW gave up big concession over the last few years to try to help the
company survive. It is consumers like you because they do not like unions
or whats happening Chrysler and GM will not be around to see the better
days. If you fell that strong it should be over the lack of quality or poor
fuel economy.

If you feel that bad about union made products then stay away from the
Toyota Corolla, Mitsubishi Eclipse, Mitsubishi Eclipse Spyder, Mitsubishi
Galant, Mazda B-Series, Toyota Tacoma, Mazda Tribute/Hybrid, Mitsubishi
Endeavor, and CAW made Volkswagen Routan.
http://www.uaw.org/uawmade/auto/2009/index.cfm

If GM and Chrysler to not survive the US economy will take a long time to
recovery. Many jobs rely on the production of the automobiles from the big
three. Many people do not realize the impact this will have on the country.

If people want the US economy to turn around they will buy as many products
as possible form US owned and US made companies. The look to purchase from
US made and Foreign owned companies.

I am proud to be union and I realize that impact the auto industry is having
on the chemical industry. Many chemical plants produce products used to
make plastics and components used in the auto industry. I know it not just
the auto industry that is causing this but it is one of the biggest markets
to several manufactures that purchase chemicals to make auto parts and
components. In my area, we have approximately 35 chemical plants in a 50
mile radius and over half have shut their doors due to the recession.

So buy American and save a job either non union or union.

USW Member and Proud

Brent

 

Except that it is like I said: The present government is so beholden to
the union constituency that it will put pressure on the process to
compromise *everyone's* interests *except* the unions. Creditors will
be asked or forced to swallow debt. The taxpayer will guarantee
everything and continue to pour money into the situation as it worsens
and worsens. The *last* component to be required to sacrifice will be
the unions because of Obama's personal interests.

And on top of that he is going to push thru "card check" in which
workers will *not* be allowed to have a secret ballot on saying if they
want union or not - a union person will watch while they fill out the
card and they will be subject to all kinds of harassment if they don't
vote the "correct" way, or at the least, *many* people will fear that as
a possibility. It is a known psychological influence on people voting
if they know that others will know how they vote. Fear of retaliation
is real.

Basically it goes against *everything* American to not have secret
ballots. It is thuggery, and it is one reason many people are so
disgusted with the unions. But Obama will make sure things go your way
on the card check.

Except I happen to feel that unions hurt quality and competitiveness.

I personally worked for a supplier to Delphi in which we took part in
the PICOS process (I assume you know about the PICOS process. Basically
it was contracts, engineering, and production people at the supplier
getting with contracts and engineering people from Delphi and
brainstorming cost cutting measures on a given part that we manufactured
and sold to Delphi.

One of the ground rules DUE TO AGREEMENTS WITH THE UNIONS (agreements
unique to GM and its sister companies) was that if one of our cost
cutting proposals would result in fewer workers being on the processing
line involving that part back at Delphi, that cost cutting proposal had
to be marked off the list automatically - could not even be considered.
Union jobs could not be eliminated for cost-cutting. In other words,
Delphi had to be at a competitive disadvantage so the union could have
excess people on the payroll.

Gee - do you think *THAT* might have put your jobs in jeopardy in our
present situation?

You're extrapolating. I never said I was against union made products.
I *AM* against the union mindset in which you intentionally put your
employer at a competitive disadvantage because you think you have a
right to a job without the normal pressures of the market place.

In the free market, things take care of themselves. With the government
micromanaging this situation, including telling them what products they
have to produce - not based on what the consumer and the market wants
but on politically correct crap - it will just require more and more
taxpayer money to keep it afloat until the whole thing collapses instead
of doing what it takes to make them truly competitive.

But they're talking about passing cap and trade. If that happens, you
can say good-bye to your manufacturing jobs because they will all move
to overseas locations. Your own union leaders are selling you down the
river because they are helping the cap and trade pass because of the
symbiotic relation between Obama and the unions.

You might want to read up on cap and trade. It is an economy killer and
a job killer. But you will be in favor of it because your union leaders
tell you it's a good thing. Suckers.

Let's have this conversation again 5 or 10 years from now after the
"chickens have come home to roost".

 

Bull! Auto Unions have made it impossible to compete with above market
value benefit packages. Sorry, nobody should earn $25/hr just to put
lug nuts on a car. Per your last comment, Quality in cars has as much
to do with design as it does with the quality of workers building it.
Workers quality has gone down the tubes and a lot has to do with
concessions made by the manufactures towards unions. Bring back market
value wages and benefits and we'll see more jobs and better cars. Hold
your tone towards the unions and see what you win...no jobs....good plan.

 

Many trade union leaders had a lot to answer for in British industry, but
often it was poor management that led to unhappy conditions. It seems both
'parties' have evolved for the better. (That was in more recent years, not
just since the present credit crunch.)

It's always easy to blame 'the workers'.

DAS

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

 

Yeah, right. You pay a local garage or dealership higher labor rates
than that -- to replace poor OEM quality nuts...

 

It's far easier to blame the big bad greedy companies it seems. Things
work when there is a balance of power between the unions and the
manufactures. I feel when times were good the balance swung in favor of
the unions and nothing put it back in balance when times worsened.
Bankruptcy is the best option. It cleans house on both sides and should
reestablish a balance beneficial to both.

 

Huh? You think a shops labor rate equals what the entry level kid
putting lug nuts on earns??? I might pay $95/hr at a local shop. The
kid putting on the tires at that shop does NOT earn $25/hr. That money
has to pay quite a few costs and not just direct labor. Sorry, nobody
should earn $25/hr just to put lug nuts on a car but they do if they are
UAW members.

 

You're quite the ignorant person. And you probably vote based on your
ignorant ideas.

 

You are some fact-deaf moron, skippy.

 

Out of pocket to the purchaser, it makes no difference whatsoever.

 

Once again proving your gross ignorance.

 

There are a lot of people who have as little understanding of economics
as you do. Unfortunately many of them vote, and some of them are even
in Congress. Look up the word "overhead" and "mass production". (Hint:
What a business charges for a service has to be way more than just what
the individual performing the service gets paid, and to try to equate
the two like you did shows gross ignorance or worse; also you show gross
ignorance, or worse, by trying to equate a high volume mass-production
situation with a "one off" operation.)

Have a nice day, jiff, or peter pan or whatever your name is.

 

Double-down, YOURS, skippy.

Your moronic "contributions" here are legendary.

 

What language is that? Can someone translate?

....yawn...

Am satisfied letting the reader judge who's FOS here. Not worried. I
see you don't have any debating skills and revert to what you just did
when you have no argument.

 

Debate?

Your comment would be hilarious, if it were not so sad.

You display the same, 100% repeated, aberrant behavior in each and every
thread you troll. Some purposely created in which to troll.

A behavior like Nathan Thurm, the SNL character played by Martin Short.

A shady lawyer, Thurm was a chain-smoker, quite paranoid, and constantly
in denial about his paranoia. "I'm not being defensive. You're the one
who's being defensive."

When questioned, his catch phrase often included, "It's so funny to me
that you would think..." He would also look into the camera and express
his puzzlement at the questioner by asking, "Is it me, or is it him?
It's him, right?"

Other times, he would deny an accusation, then immediately reverse his
position when the accuser reaffirmed the statement. "No, it isn't!"
("Yes it is.") "I know that! Why wouldn't I know that? I'm well aware of
that!"

Imagine: