If you think that there won’t be an automaker around that’s having a worse year than Toyota, then you might be surprised that Chrysler is actually having it worse.

Many have expected that Fiat’s rescue of Chrysler was the best thing that ever happened to Chrysler in recent years. When it comes to tech prospects, yes. But sales figures have shown that it might not really be the case.

Overall sales are only down 3% but more than half of their sales are to fleet customers. Consumer sales are down 44% meaning that many car buyers have opted for other makes instead.

Fleet customers do not really translate to good business. While they do provide the added volume on sales, they do often come with bigger discounts. Unlike with regular customers where discounts can only go so far hence a wider profit margin.

As for Toyota, sales are down by 14% even after freezing sales on eight of its models for a week.

The thing with business is it really is a dog-eat-dog world. Falter and your competitors would be more than happy to kick you while you’re down.

Toyota might be the biggest automaker today after GM went bust but it might not be able to hold on to the title for long. Especially with mighty Volkswagen eating away at the lead and, of course, in the light of one of the biggest recalls in history.

An accelerator problem prompted Toyota to recall millions of vehicles worldwide. The company even halted US sales of select models until its engineers figure out a permanent solution to the problem.

Ready to pick on the wounded giant are GM, Ford, Chrysler and Hyundai who are offering Toyota customers incetives on trade-ins.

Chrysler is offering $1,000 bonus for Tundra, Tacoma, and Sienna owners who’d want to get any new Chrysler, Jeep, Dodge or Ram. A similar $1,000 offer is made by Hyundai for any new takers of a Sonata, Elanta, and Elantra Touring.

Call it honor, but Toyota’s biggest Japanese rival Honda which has been permanently trying to pip Toyota’s model range, takes the high road in not trying to steal Toyota’s customers in such a manner.

There’s no doubt that the Fiat takeover of Chrysler can be credited to the push made by Fiat boss Sergio Marchionne and it looks like he’s been enjoying all this restructuring that’s been going on. He’s currently serving as the boss of both companies.

Marchionne announced that this will not be the case by the end of two years. He’ll be picking between the top post of Fiat and Chrysler but is definite to leave one post behind.

He has yet to decide between the two.

It’s pretty natural for Marchionne to consider heading just one company particularly due to the breadth of reponsibilities of running two major car brands, both with their own sub-divisions.

Just last month, Marchionne unveiled some of his plans to streamline Chrysler’s brands and how to market some of Fiat’s divisions like Alfar Romeo outside Europe.

Fiat’s quite aggressive with how they’d be dealing with Chrysler. Just last week, they unveiled their five-year recovery plan which will basically see a streamlining of Chrysler’s fleet. Now that’s just for the development bit.

As for the marketing bit, CEO Sergio Marchionne is intent on working on the branding part. Chrysler’s brands will only be retained in North America and will be phased out elsewhere.

Save for Jeep which will be used to market 4x4s and UVs outside the States. As for existing Chrysler tech, they will still reach foreign shores but they will be found in cars bearing Fiat badges like Lancia and Alfa Romeo.

Chrysler cars will still be fully reatined but will be rebadged as Lancias. Dodge models will appear as Fiats.

Fiat boss Sergio Marchionne has quite a lot in store for the Chrysler group. For starters, he wants to cut out weaker models as part of the effort to bring back the ailing US automaker back on its feet. By the looks of it, Marchionne wants to bet on the strongest products first.

I do like this decision. With everyone else trying to diversify their product lines, I think that many automakers are just exposing themselves to either product cannibalism or limited opportunities from oversaturated markets.

Fiat’s acquisition of Chrysler opened up the possibility of both technology and dealership sharing. Fiat aims to widen its stake in the US market while Fiat can also use its Europe dealerships to sell American cars.

One thing that I might not be comfortable with is the re-badging of certain models. Fiat’s Alfa Romeos bear a certain pedigree that might get tarnished once Chrysler models are sold under the name. They’ve already hinted on the possibility of an Alfa Romeo Challenger. How about a Dodge 500 Abarth? Doesn’t really work in book.

Models to be dropped include the Chrysler Sebring, the PT Cruiser, the Jeep Compass, and the Jeep Patriot.

US President Barack Obama has confirmed that American automaker Chrysler is filing for Chapter 11 bankruptcy protection, pushing for the decision after the company could not show some measure of viability at the deadline imposed by the government.

After some the overnight collapse of last-minute talks with Chrysler’s debtors, it was clear that Chrysler would be filing for bankruptcy protection. This decision could contribute speed up the union between Chrysler and Italian automaker Fiat. Chrysler’s operations will stay as normal while under protection, without any job cuts planned. However, there may be cuts in dealerships.

“I don’t think there should be a stream of subsidies to automakers, but helping them to restructure now, when sales have collapsed, is realistic,” said President Obama as he was pushing for the decision. “The necessary steps have been taken to give one of America’s most-storied companies a new lease on life,” he added later, when the decision was made.

Chapter 11 of the US Bankruptcy Code allows a company to remain in business and allows for reorganization even while it cannot pay for its debt to creditors.

Source: Autocar

Chrysler finally gets a break as they finally forge a deal transferring 35% of Chrysler to Fiat. Fiat SpA of Italy and Chrysler LLC owned by Cerberus Capital Management LP announced a global alliance that sets Fiat to eventually take control over the US automaker.

However, in an interesting arrangement, Fiat expressed interest in management control (as for now) but instead, they want to have access to Chrysler’s tech bins, designs, and platforms. Quite intriguing that. How about a next-generation Fiat 500 built on a Viper platform. Pretty nice.

I think this is a great deal. Aside from the breather that Chrysler gets from this deal, they could definitely use a European touch to their cars. There are a lot of good things to come up with such partnerships. Not that I’d compare this deal with Renault and Nissan, but I guess this could be Chrysler’s breath of life.

Source: Detroit News

Chrysler Group UK, under its revamped senior management, has a clear marketing plan to weather the current automotive industry crisis. The company is going to focus more on actual market demand and pin their hopes on core sales models for each of its three brands—Chrysler, Jeep, and Dodge.

This plan was bared by marketing director Nigel Land at Chrysler UK’s customary year-end media brief. He mentioned that the Chrysler 300C and Grand Voyager, the Jeep Patriot, and the Dodge Journey will be the core sales models for those respective brands.

“Next year we must focus on getting the message across to the buying public on the relevance of our brands,” said Land. “We must show customers what our models do and the relevance they have to the public’s needs. We will be taking our products to the people and showcasing them at appropriate events as well as using new forms of communication such as YouTube to get our message out there.”

In the face of production cuts and restructuring, Chrysler UK is looking at these measures for the immediate future, especially since Chrysler LLC in the US is still awaiting its share of the $15 billion bailout money.

Source: Motor Torque

As Chrysler LLC presented its short-term and long-term viability plans to the government, the automaker stressed the importance of securing an immediate $7 billion in government emergency loans in order to stay afloat and weather the current crisis.

Chrysler, a member of the Detroit Big 3, is also seeking some $6 billion in aid from the Department of Energy, with its loan funds through 2009 being part of the long-term viability effort. The company dismissed the notion of bankruptcy, citing the impracticality of liquidating assets in the face of the current global economic crunch. Bankruptcy would simply mean throwing in the towel, because the auto industry simply won’t recover should companies choose to go that route.

Further viability plans include strengthening the automaker’s partnerships with other automakers to capitalize on shared resources and platforms, as well as the development of electric and electric hybrid vehicles. The DOE loan is intended to cover the cost of the latter.

Automotive industry turnaround projections predict yet another slow year in 2009, but sales are expected to pick up by 2010 and reach near-2007 figures in 2012.

Source: Motor Authority

Everybody knows that Chrysler LLC, as part of the Detroit Big 3 automakers who have asked for – and been denied – a $25 billion bail-out from the government, is losing money. It’s only now that the public is let in on how much. Bob Nardelli, CEO of Chrysler, said that the company has only $6.1 billion left in terms of cash reserves.

In the third quarter of 2008 alone, Chrysler lost about $3 billion. The company needs around $5 billion to continue operations, according to Nardelli. That leaves only $1.1 billion free, which frankly isn’t much especially if Chrysler keeps losing revenue like in the previous quarter.

Chrysler also has pending employee bonuses to bankroll, along with a healthcare obligation worth some $20 billion annually and overdue supplier bills. It doesn’t take a math wizard to see that Chrysler stands to run out of cash by the time 2009 hits, even despite extreme cost-cutting measures that include Nardelli cutting his annual salary down to a single dollar.

Well, one thing is clear: Nardelli better draw up a good viability plan to present by December 2 if he wants even a piece of that $25 billion government bail-out.

Source: Left Lane News

Doomsayers might as well be soothsayers with the way the US car market is shaping up these recent weeks. With General Motors and Chrysler talks ongoing on a possible merger, experts fear that given GM’s already shaky outlook that we might soon see the fall of two of Detroit’s big three.

GM and Chrysler have announced more job losses to further cut costs and even new models are put on hold to further curb spending. A few of the models currently shelved are Cadillac CTS Coupe and the Buick Lacrosse.

With US’ credit economy failing, both GM and Chrysler are in deep shit financially. Experts consider the merger only likely if the federal government steps in to help both companies. GM asked the US Treasury for a $25B loan package to help the company inch its way back to more solid footing.

The situation is even made more complex by the coming US elections. With presidential candidates having different economic and energy policies. John McCain wants to $25B loan to materialize first before doing anything else. Barack Obama wants to double the loan package with the condition that the companies build economical vehicles from the money.

Source: Autocar

The talks about General Motors buying out Chrysler to put an end to everything Chrysler, some of its divisions and subsidiaries just might get to see the light of day again. It appears that Renault is interested in acquiring Jeep. Jeep’s a brand that’s considered as Chrysler’s most valuable. It’s got tradition and pedigree. So yeah, I might just have to agree. Dodge has been dodgy or a while now.

Anyway, I do wonder why Renault is intent on getting back the SUV line from Chrysler after it sold the badge together with American Motors to Chrysler in 1987 after owning it from 1979. This deal would diversify Renault’s line.

Renault admits that they do regret letting go of AMC and Jeep back in the day with Former Renault chairman Louis Schweitzer saying “It would have been clever to make full use of Jeep. If we had done so, we would have been in a good position today in the U.S.”

Source: Reuters

Chrysler fans may weep for the possible demise of the name and badge they have so loved. Chrysler has been quite a part of Americana that I’m sure this move will alter the face of American motoring. In an effort for both companies to stay afloat, there is a possibility for General motors to absorb Chrysler LLC.

That’s 83 years of Chrysler goodness to be swept under the great GM rug. Chrysler’s major stockholder – Cerberus Capital management – is planning to shift all its 88% of sticks to GM’s possession. This scenario is similar to what happened in Chrysler’s acquisition of American Motors Corporation back in 1987.

Some experts view this as an aggressive competitor buyout as GM would definitely benefit from eliminating Chrysler as a competitor. Try to visualize a Viper with a GM badge? Ugh.

Source: Detroit News

The state of Michigan is now worried about the plight of the (not-so-)Big 3 and are now taking measures to help the ailing Detroit automakers. Well, there’s a big reason that the government should be worried. With all the plant closures and downsizing going on, it’s bound to hurt not only the economy, but it would also be a big blow to the state. Imagine how many unemployed would have to file for welfare.

The state congress is pushing for proposals that include a Federal aid amounting to $27 billion for the next five years in the form of loans, tax incentives and subsidies. Ford, GM and Chrysler are all reeling with the drop of auto sales both locally and internationally due to the oil crisis.

While this would spell good news for the Big 3, I’m pretty sure that a lot of taxpayers would be fussing about how their tax dollars will get spent. This should definitely be wake-up call for the Detroit automakers to start thinking about how they can build good cars worth that is worth buying.

Let’s face it, compared to Japanese and European makes, many of the cars these 3 companies have made over the past years are so crappy, they can be put to shame by car companies a thousandth their size. And if only they haven’t been responsible for the gas-guzzling culture…

Source: Leftlane

In the latest spin to produce sales, Chrysler does a drastic move committing themselves to cut gas prices for new Chrysler owners to only $2.99 a gallon for three years. With gas prices seeming to challenge the $5 a gallon mark, who wouldn’t want to have such a bargain?

This type of campaign isn’t exactly new but Chrysler just upped the ante by expanding the coverage to almost all models and the scope – nationwide. Something this drastic is definitely aimed to address something worse – which happens to be Chrysler’s sales records in recent quarters. Sales have been dismal with a 17.6 percent decline.

A few clinchers though, while this “Let’s Refuel America” drive covering Chrysler, Dodge and Jeep new vehicles, they would only concern gasoline with up to 87 octane regular unleaded fuel, E85 fuel or diesel fuel only. Exempted from the drive are some of their guzzlers – SRT models, Dodge Viper, Dodge Challenger, Dodge Ram Chassis Cab, Chrysler Crossfire, Jeep Wrangler and Dodge Sprinter.

Source: Det News

Quite different from all the trucks and the toned American muscle that will be featured in this year’s SEMA show, what we have here is the Chrysler SR 392 Roadster. If you’d ask me, I’d say this should belong to Tokyo instead of Las Vegas with how it looks. But hey, it’s a Detroit baby even dubbed as a “Detroit roadster” (whatever the heck that is).

The design sketch might look funny since it’s inspired by a 1927 street rod design. However, that should distort the fact that this Chrysler will be packing the same engine to be used by the Jeep Wrangler Ultimate – the new 392 HEMI crate engine from Mopar.

So what’s the fuzz over the Chrysler 392 HEMI crate engine? It’s capable of producing somewhere between 525 – 540 horsepower with torque ranging from 490 to 520 pound feet depending if it’s strapped with a carb or an EFI. So it would give trucks and SUVs a lot of power and pull but imagine all that strapped on a roadster. Menacing.

Car Magazine features this list of the the worst celebrity endorsers for cars. Quite an interesting list too.

• Bryan Adams and Audi
• Tiger Woods and Buick
• Celine Dion and Chrysler
• OJ Simpson and Hertz car rentals
• McLaren and its F1 drivers

In all honesty, I’d have to pick Toyota and its endorsers as the better ones. When that Britney Spears Toyota Vios ad came out, it really made me crave for one (in all hopes of having the pre-trashed out Britney inside one).

The best? James Bond. Nothing can make a car scream “Sex!” more than being driven by Bond. The Aston Martin DBS? Ooooh yeah! Don’t tell me you didn’t want one after watching Casino Royale.

Source: Car Online

Chrysler issued a recall of 300,000 SUVs to address a potential braking problem when driving uphill. The recall covers 2006-2007 Jeep Grand Cherokees and Commander, 2007 Jeep Wrangler SUVs and 2007 Dodge Nitro SUVs.

Chrsyler apparently received 20 complaints that vehicles experienced braking delays when drivers stepped on them to stop after coasting uphill. To address the issue, the computer connected to the ABS need to be reprogrammed. A crash has already been reported though no one was seriously harmed.

Apart from these recalls, Chrysler will also put the word out on 72,333 Dodge Avenger sedans and Chrysler Sebring convertibles from the 2008 model year that suffer from problems involving the front door latches and locks.

Earlier this week, Honda also issued a recall of 182,756 Civics due to a faulty wheel bearing O-ring causing it to leak and will cause a wheel to fall off “possibly resulting in a crash,” says Honda. Yeah, a wheel falling off may “possibly” cause it to crash. Now that takes a genius to figure out. Consolation for Civic owners though, Honda will notify owners by mail and replace any damaged parts for free.

Source: Detroit News (Chrysler and Honda)

If there’s one thing I’d like to be 100% in good running condition in my car, it would be the brakes. Acceleration and speed do not mean squat if your car can’t stop. Too bad for BMW, that’s one area in the X5 where they have to recheck. A problem with brake fluid level warning light can cause drivers to totally miss leaks since the system doesn’t work 100%. X5s built from February to April suffer from this fault.

And it’s not just BMW who will be doing recalls. 2,200 units of Jeep Liberties have also been recalled by Chrysler due to a heater motor fault. The fault can result to fires. Nasty thing to experience, especially when cars run on fuel (flammable). Chrysler also issued a recall with 212 Chrysler PT Cruisers due to the rear quarter windows falling out.

Likewise, automaker Maserati recalled 718 Quattroporte units for defects in the ABS software.

Source: Auto Express

For those of you who haven’t heard/read the news, Chrysler is under new management under Cerebrus Capital Management LP. Cerebrus bought Chrysler from former owner Daimler AG for USD 7.4B.

Now Chrysler employees are now starting to get jittery and jumpy because of the recent events. One thing they’re not happy about is the appointment of Robert Nardelli (Home Depot and General Electric) a known cut-throat chief. To compound matters, Nardelli is an outsider to the industry. Employees are now starting to apply for jobs at Daimler and Chrysler Financial.

Change management is one thing that Cerebrus has to look into. Losing white-collar men spells bad news for any organization.

Source: Detroit News