Fiat CEO: Chrysler worse than we thought

[appleyum]

http://money.cnn.com/2009/09/16/autos/fiat_chrysler/index.htm
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.
Yikes that's pretty bad with no fuel efficient car lined up

[lobo411]

Yikes that's pretty bad with no fuel efficient car lined up

It was owned by Cerberus, a private equity firm, during that period. So much for the brilliance of these private sector financial wizards who are supposed to know how to run everything right, huh?

[redmaxx]

Cue rrc saying they should have been left to die so that there could be more room for GM and Ford.

I agree with that opinion. ;)

[chazjr]

It was owned by Cerberus, a private equity firm, during that period. So much for the brilliance of these private sector financial wizards who are supposed to know how to run everything right, huh?

Its pretty much like California politicians who have never run a business and have control of the "7th biggest economy in the World"., and have bankrupt it.

Its really no surprise, if you think about it..

[Radeck]

It was owned by Cerberus, a private equity firm, during that period. So much for the brilliance of these private sector financial wizards who are supposed to know how to run everything right, huh?

since you obviously dont know anything about this case, or are just up to your usual hype, it had nothing to do with Cerberus...when Daimler (Mercedes) decided to dump Chrysler, they took all the good parts with them, and left Chrysler a rump in bad shape that had little to no chance of surviving...

it had nothing to do with your usual obsessive and idological smear targerts, the big evil investors, and everything to do with Daimler mismanaging the company with german ceo's unfamiliar with the culture and business, the clash of the two coporate cultures oerall, and finally chopping up the company, taking the good parts with it, and dumping the rest.

some recent analysis: http://money.cnn.com/2009/04/23/autos/who_killed_Chrysler.fortune/index.htm

[808Lurker]

Cue rrc saying they should have been left to die so that there could be more room for GM and Ford.

I agree with that opinion. ;)

I am betting on an anti-union rant

[ripcurl]

Daimler and the FTC left Chrysler on life support. Chrysler was the most profitable automaker in the US before the takeover/merger. That was with UAW employees.

Then Cerberus came in and finished the job with the most ineffective CEO ever, Bob Nardelli.

It's sad that greed killed a great company , one of the true US innovators.

[redmaxx]

I am betting on an anti-union rant

That too. :nod:

[chazjr]

This is Bad News for me.. Chrysler cars depreciate very fast.. Then when they went Bankrupt, it is even worst..

I needed a good deal on a car.. So I found a "Super Deal" on a 2007 PT Cruiser..
A rental, 36,000 miles, loaded.. Clean Carfax.. $6985..+ Tax & License..
It retails for $11,000.. It runs like a Top.. So far, I am very happy..
It is a Cool Little car..

But if I start having problems with it.. I am going to Arizona.. Have you heard of the Grand Canyon.? I will find a place to run it off a Cliff..:nod:

Pretty much like the Politicians, who have "run the US Economy off a Cliff".

[redmaxx]

This is Bad News for me.. Chrysler cars depreciate very fast.. Then when they went Bankrupt, it is even worst..

I needed a good deal on a car.. So I found a "Super Deal" on a 2007 PT Cruiser..
A rental, 36,000 miles, loaded.. Clean Carfax.. $6985..+ Tax & License..
It retails for $11,000.. It runs like a Top.. So far, I am very happy..
It is a Cool Little car..

But if I start having problems with it.. I am going to Arizona.. Have you heard of the Grand Canyon.? I will find a place to run it off a Cliff..:nod:

Pretty much like the Politicians, who have "run the US Economy off a Cliff".

You're not hoping to then file an insurance claim are you? Because this thread would be proof of insurance fraud. ;)

[Rebound]

I am betting on an anti-union rantClearly, labor unions failed to design new cars.

[808Lurker]

Clearly, labor unions failed to design new cars.

Darn them to heck!

[rrc06]

That too. :nod:

I am betting on an anti-union rant

Cue rrc saying they should have been left to die so that there could be more room for GM and Ford.


I was actually thinking redmaxx was going to start off with a "american cars are the best" chant :P

And yes, the UAW does share the blame in the big 3's maladies.

Clearly, labor unions failed to design new cars.

clearly, labor unions failed to figure out that a company has to be profitable (http://images.forbes.com/media/magazines/forbes/2006/1127/Forbes_1127_p48_f1.gif) to survive ;) They did have the foresight though to get a certain POTUS elected to save their ass at the exact time required.

[808Lurker]

I was actually thinking redmaxx was going to start off with a "american cars are the best" chant :P

And yes, the UAW does share the blame in the big 3's maladies.



clearly, labor unions failed to figure out that a company has to be profitable (http://images.forbes.com/media/magazines/forbes/2006/1127/Forbes_1127_p48_f1.gif) to survive ;) They did have the foresight though to get a certain POTUS elected to save their ass at the exact time required.

WOOT!

Union rant for the win!

[rrc06]

WOOT!

Union rant for the win!

so let me get this right.... you absolve the union of any blame at all in this situation?

[ripcurl]

How was it that Chrysler was so profitable on each vehicle , with union labor, before Daimler took over? Chrysler was the envy and the darling of the American auto industry. In fact, that was partially the reason Daimler bought them, for their efficiency, low development costs and profit per vehicle.

Also rememember, it was employers malfeasance that prompted the creation of unions.

[rrc06]

How was it that Chrysler was so profitable on each vehicle , with union labor, before Daimler took over? Chrysler was the envy and the darling of the American auto industry. In fact, that was partially the reason Daimler bought them, for their efficiency, low development costs and profit per vehicle.

Was it a sustainable profit (http://findarticles.com/p/articles/mi_m3012/is_n7_v178/ai_20943719/)? Remember, the mid 90s was a great time to be a car manufacturer, with record low oil prices to help things out. Over the ensuing years, all of the big 3 succumbed to softening marketshare as the foreign autos picked up.

That being said, I do think Daimler bit off more than they could chew and really should have avoided the merger altogether.

Also rememember, it was employers malfeasance that prompted the creation of unions.

Link? Henry Ford paid his workers better than anyone, and he despised unions.

[appleyum]

Cue rrc saying they should have been left to die so that there could be more room for GM and Ford.

I agree with that opinion. ;)

:jawdrop:

[xillix]

It was owned by Cerberus, a private equity firm, during that period. So much for the brilliance of these private sector financial wizards who are supposed to know how to run everything right, huh?
Cerberus was not looking for a long term investment. Cerberus indicated that it only had interest in parts of Chrysler Corporation (mostly centered around Chrysler Financial, which actually was making money). The point of acquiring Chrysler was to get the rest into decent shape so it could be resold at a higher price.

Of course when that did not happen because of large market problems things got all bailouty.
since you obviously dont know anything about this case, or are just up to your usual hype, it had nothing to do with Cerberus...when Daimler (Mercedes) decided to dump Chrysler, they took all the good parts with them, and left Chrysler a rump in bad shape that had little to no chance of surviving...
And this is true. But Cerberus cannot be completely absolved of blame. It never appeared that Cerberus and its partners were looking for long term viability of the Chrysler company.

[rrc06]

It never appeared that Cerberus and its partners were looking for long term viability of the Chrysler company.

Is that surprising? They are a private equity firm looking for the next fixer-upper on the cheap to sell off for a profit.

[808Lurker]

so let me get this right.... you absolve the union of any blame at all in this situation?

Didn't say that.... was just correcting this statement

Cue rrc saying they should have been left to die so that there could be more room for GM and Ford.

I agree with that opinion. ;)

I said you would go after the unions before saying that Chrylser should die off... ;)

Unions share some blame, but it's capitalism at it's finest, people coming together to negotiate a killer deal... booya! yay capitalism!

[redmaxx]

I said you would go after the unions before says they should die... ;)

:huh: :confused:

[808Lurker]

:huh: :confused:

ooops, fixed it ;)

[lobo411]

Link? Henry Ford paid his workers better than anyone, and he despised unions.

Correction: Ford despised unions and Jews.

He loved Nazis and mobsters.

http://en.wikipedia.org/wiki/Henry_Ford

Picture of the Nazi medal Ford received in person at a ceremony in 1938:

http://upload.wikimedia.org/wikipedia/commons/7/7e/Service_Cross_of_the_German_Eagle.JPG

[DarthSaver]

So did GM. Now that we as tax payers own them, does that make us Nazi sympathizers?

[Elmer]

Picture of the Nazi medal Ford received in person at a ceremony in 1938:

Same medal they gave to Congressional Medal of Honor recipient Charles Lindbergh.

[appleyum]

So did GM. Now that we as tax payers own them, does that make us Nazi sympathizers?
http://www.washingtonpost.com/wp-srv/national/daily/nov98/nazicars30.htm

a book scheduled for publication next year will accuse General Motors Corp. of playing a key role in Hitler's invasions of Poland and the Soviet Union.

"General Motors was far more important to the Nazi war machine than Switzerland," said Bradford Snell, who has spent two decades researching a history of the world's largest automaker. "Switzerland was just a repository of looted funds. GM was an integral part of the German war effort. The Nazis could have invaded Poland and Russia without Switzerland. They could not have done so without GM."

When American GIs invaded Europe in June 1944, they did so in jeeps, trucks and tanks manufactured by the Big Three motor companies in one of the largest crash militarization programs ever undertaken. It came as an unpleasant surprise to discover that the enemy was also driving trucks manufactured by Ford and Opel -- a 100 percent GM-owned subsidiary -- and flying Opel-built warplanes. (Chrysler's role in the German rearmament effort was much less significant.)

The importance of the American automakers went beyond making trucks for the German army. The Schneider report, now available to researchers at the National Archives, states that American Ford agreed to a complicated barter deal that gave the Reich increased access to large quantities of strategic raw materials, notably rubber. Author Snell says that Nazi armaments chief Albert Speer told him in 1977 that Hitler "would never have considered invading Poland" without synthetic fuel technology provided by General Motors.

An FBI report dated July 23, 1941 quoted Mooney as saying that he would refuse to take any action that might "make Hitler mad." In fall 1940, Mooney told the journalist Henry Paynter that he would not return his Nazi medal because such an action might jeopardize GM's $100 million investment in Germany. "Hitler has all the cards," Paynter quoted Mooney as saying.
Yikes

[Elmer]

Fiat CEO: Chrysler worse than we thought......


:eek:

Who would have ever thought an American car company would be so bad that Fix It Again Tony would say it was "worse than they thought"............


:vomit:

[PhoenixFP]

Yikes

So American companies profited off of Hitler's army.

You should read up on all the profiting done by the pharmaceutical companies because the Germans tested new products on the inhabitants of death camps. You'd be surprised just how many there are.

I'm not saying GM and Ford are perfect angels, it's just that they played the whole Capitalism thing pretty well- US and Germany both used their products. Every battle meant more potential profits for them. Sounds pretty damn smart to me.

[larrymoencurly]

Picture of the Nazi medal Ford received in person at a ceremony in 1938Same medal they gave to Congressional Medal of Honor recipient Charles Lindbergh.You need to come up with an example that doesn't go against you. :lol:

[larrymoencurly]

How was it that Chrysler was so profitable on each vehicle , with union labor, before Daimler took over? Chrysler was the envy and the darling of the American auto industry. In fact, that was partially the reason Daimler bought them, for their efficiency, low development costs and profit per vehicle.

Also rememember, it was employers malfeasance that prompted the creation of unions.Then explain IBM's unionized work force.

[Elmer]

You need to come up with an example that doesn't go against you. :lol:

How does it "go against" me?

Or are you just assuming you know what I meant?

[larrymoencurly]

Picture of the Nazi medal Ford received in person at a ceremony in 1938.
Same medal they gave to Congressional Medal of Honor recipient Charles Lindbergh.
You need to come up with an example that doesn't go against you.
How does it "go against" me?

Or are you just assuming you know what I meant?It depends on whether you meant if Lindbergh was a hero or fool in that instance.

[rrc06]

Another misguided move by the Obama administration.... Chrysler should have been allowed to fail if they were going to bail out GM....

When Chrysler could have sold for $1 (http://money.cnn.com/2010/09/09/autos/Chrysler_bailout.fortune/index.htm)

FORTUNE -- One of the lesser-known stories of the Obama Administration's auto bailout is how close Chrysler came close to following the fate of Lehman Brothers and being allowed to fail.

A majority of the Treasury Department's auto task force actually voted in favor of withholding further aid from the automaker. And it was only after a tense 45-minute meeting in the White House that President Obama agreed for the federal government to rescue Chrysler.

The automaker was worth more alive than dead. Liquidation would yield just $1 billion. But Chrysler's problems -- loss of market share, overwhelming structural costs, outflows of cash -- were staggering. The auto task force created by new President Obama figured bankruptcy was inevitable.

By the time the auto team met with White House chief of staff Rahm Emanuel in the West Wing, they doubted whether Chrysler should be allowed to continue to survive as an independent entity. Emanuel was characteristically blunt: "Why even save GM?" he asked, according to Rattner. Reminded of tens of thousands of autoworkers whose jobs were at stake, he barked out "fark the UAW."

On March 13, the auto task force met to decide Chrysler's fate. Those who opposed further aid argued that its demise would improve the odds of survival of GM and Ford because most would-be Chrysler buyers would shift to other domestic brands. By one analysis, GM would capture 300,000 additional customers -- a quarter of Chrysler's business -- if Chrysler failed. That would increase GM's profit by $2.4 billion and add $10 billion to its market value.

A Chrysler liquidation would vaporize 300,000 jobs industry wide including 40,000 at Chrysler. But some argued that the loss would be minimized as others filled in the gap. Besides, continuing to bail out Chrysler would send the wrong signal about the administration's willingness to make hard decisions.

In the end, the argument to save Chrysler was based more on political and social reality. Saving the automaker would prevent the loss of those 300,000 jobs and President Obama being blamed. Ripple effects might include Michigan's state unemployment fund going broke.

[Krazen1211]

The verdict is in.

http://washingtonexaminer.com/blogs/beltway-confidential/2011/06/taxpayers-lost-644-billion-chrysler-bailout

Taxpayers lost $6.44 billion on Chrysler bailout

[124nic8]

The verdict is in.

http://washingtonexaminer.com/blogs/beltway-confidential/2011/06/taxpayers-lost-644-billion-chrysler-bailout

Taxpayers lost $6.44 billion on Chrysler bailout


“Chrysler has repaid every dime and more of what it owes the American taxpayer from the investment we made during my watch.” That is just not true. Here is the math.

Chrysler received the following loans from the federal government:
January 2009: Chrysler receives $4 billion loan from TARP
January 2009: Chrysler financial receives $1.5 billion from the Treasury Department
May 2009: Chrysler receives a $1.9 billion debtor in possession loan from the Treasury Department
June 2009: Chrysler receives a $6.6 billion loan from the Treasury Department
Total loaned to Chrysler: $14 billion

Chrysler made the following payments to the federal government:
May 2010: Chrysler pays the Treasury Department $1.9 billion to settle their January 2009 loan.
May 2011: Chrysler pays the Treasury Department $5.1 billion as partial settlement for June 2009 loan.
June 2011: Chrysler pays the Treasury Department $560 million to settle the rest of the June 2009 loan.
Total paid back by Chrysler: $7.56 billion

Total loss to taxpayers ($14 billion – $7.56 billion) = $6.44 billion.

Read more at the Washington Examiner: http://washingtonexaminer.com/blogs/beltway-confidential/2011/06/taxpayers-lost-644-billion-chrysler-bailout#ixzz1OWuEG6Ga

Are they sure Obama's sig was on those Jan 2009 checks?

[new33]

The verdict is in.

http://washingtonexaminer.com/blogs/beltway-confidential/2011/06/taxpayers-lost-644-billion-chrysler-bailout

Taxpayers lost $6.44 billion on Chrysler bailout

thanx to gwb

http://www.mcclatchydc.com/2009/01/16/59912/one-last-bush-bailout-before-end.html

[new33]

http://detroit.about.com/od/bigthreebailout/a/auto_bailout.htm

[Anonymouse]

How was it that Chrysler was so profitable on each vehicle , with union labor, before Daimler took over? Chrysler was the envy and the darling of the American auto industry. In fact, that was partially the reason Daimler bought them, for their efficiency, low development costs and profit per vehicle.

Also rememember, it was employers malfeasance that prompted the creation of unions.Hmmmm, and yet BEFORE Cerberus took over BOTH Chrysler AND Daimler were well-run and profitable companies - and Daimler STILL is.
One has to wonder just where the common denominator lies.
For that matter, one wonders where the lies lie, considering the miscasting of truth perpetrated by the Anti-Unionists.