Archive for Chrysler

DaimlerChrysler today announced that it is open to the possibility of dropping the loss-making Chrysler group from it’s organization structure, or finding new partners for the American automotive group. Previously, DCX stood by Chrysler with a long-term commitment since it’s merger in 1998, but perhaps a predicted operating loss of more than US$1.31 billion foreseen by analysts – the third full-year loss since the merger is just too much for DCX to take. This loss will be offsetted by an earnings rebound at premium passenger car division Mercedes Benz and solid results from its market-leading truck manufacturing division.

The announcement pushed Chrysler stock up by more than 5%, up to it’s highest level since June 2002 – peaking at US$67.43 per share. DCX CEO Dieter Zetsche is expected to announce that an investment bank has been hired to review strategic options for the group. However, divesting the two groups is easier said than done, as cutting apart the two companies would cost an estimated US$34 billion, eclipsing DaimlerChrysler earnings, which is expected to be US$1.92 billion for the Q4 of 2006.

I find it funny that such an announcement should be made, announcing the possible separation of two lovers that were never meant to be on Valentine’s day.

Source: AutoNews

After news of talks between Chrysler and Chery surfaced in May last year, Chrysler group CEO Tom LaSorda has finally signed a letter of intent with Chery Automobile Co to develop a small car for the group, but this is pending approval by DaimlerChrysler supervisory board, which will meet this month to discuss the matter. Other partners which were considered were Mitsubishi Motors Corp, and Hyundai Motor Co Ltd, but it is Chery who managed to clinch the deal in the end.

The collaboration is expected to be approved by the DCX board, and manufacturing will soon begin, according to Chrysler spokesman Jason Vines. It is not known for now Which badge under the Chrysler group will appear on the grille of this new small B-segment car, but the logical choice would be Dodge, the group’s value brand. Chrysler previously exhibited a concept small car, the Dodge Hornet, an aggressive-looking muscular small car, but the new compact from the Chery-Chrysler collaboration will not be the Dodge Hornet.

The car is expected to be built in China, as Chrysler says it cannot profitably produce a small car in the US. Chrysler has been in talks with Chery for nearly a year before this agreement was reached. More details will be released in a month’s time or earlier. The new small car will compete against the Toyota Yaris, Chevrolet Aveo, Honda Fit and Nissan Versa in the United States. It will also be sold in Canada, Mexico, Europe and possibly China. While this is a start for Chery’s involvement in the US market, but it is still keen to export it’s own cars under it’s own brand to the US as the small car will not be Chery-branded.

2006 was not a good year at all for Chrysler dealers in the US. The company kept cranking out minivans, medium to big cars and SUVs throughout the whole summer despite warnings and suggestions by dealers against the move. Chrysler just went on and on with overoptimism fueled by the success of the Chrysler 300. Despite employee pricing sales incentives and other promotions, dealers choked on inventory and floorplan bills skyrocketed with dipping sales. The Chrysler group posted a US$1.48 billion loss in the third quarter 2006. Will this new small car give Chrysler and it’s dealers a much needed boost? And even if so, what is Chrysler going to do with it’s sales bank of unsold cars? Instead of slowing down production when demand dropped, production was kept at full capacity, and now unsold Chrysler cars are just lying around in storage areas. Sound familiar?

Check after the jump for an interview with Tom LaSorda.

Related Posts:
2006 Dodge Hornet Concept
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Click here to read the rest of Chrysler and Chery sign small car letter of intent

Some news regarding collaboration between DaimlerChrysler and Chery. Previously it was reported that Chrysler will name it’s subcompact car partner by the end of 2006, with talks currently on-going with a few partners. Subcompacts which are known for frugal fuel consumption – important in these high fuel price days – account for 1% of the overall US market currently, but it is expected to double in amount next year.

DaimlerChrysler is said to be in final talks to build cars in China and export them to the US under the Dodge brand to take advantage of the cheaper costs there. This move will follow Honda Motor Co’s recent recision to export vehicles built in China. However, DaimlerChrysler is keeping mum on the issue, and it is said that this collaboration is very controversial within DaimlerChrysler, with opponents questioning whether cars produced in China by Chery can meet quality standards.

Other partners being considered are Mitsubishi Motors Corp, and Hyundai Motor Co Ltd. “We know we can’t do it alone. The capital expense alone would be very high, said Chrysler Group CEO Tom LaSorda.

Source, 2

Chrysler Group’s Jeep has launched a marketing campaign featuring bobbleheads to market the 2007 Jeep Compass crossover to it’s target market of the 22 to 30-year-old urban crowd. Jeep hopes to attract urban dwellers with the Compass, a move that differs from Jeep’s typical off-road target audience. There are 4 videos, called Monday, Gear, Bounce and Phil. Videos after the jump.

Click here to read the rest of Jeep Compass Bobblehead Ads

EON has been in talks with DaimlerChrysler and some of it’s unit companies for a distributorship here in Malaysia. The talks are centered on distributing cars with engine capacities of more than 2 liters. DaimlerChrysler currently has the following marques under their umbrella: Mercedes Benz, Maybach, smart, Chrysler, Dodge, and Jeep. They used to own a stake in Mitsubishi as well but disposed of it not too long ago.

DRB-HICOM who is leading the distributorship talks already assembles and distributes Mercedes cars here in Malaysia, and smart’s engine capacities are below 2 liters. That leaves Chrysler, Dodge, and Jeep. Perhaps we might be able to see a 2.4 liter Dodge Stratus or new Jeeps being officially brought in. The new Jeep Compass looks good. Or this could be a new Mercedes distributorship.

Source

DaimlerChrysler AG’s Chrysler unit says it will name it’s sub-compact car partner by the end of the 2006. Chrysler is in talks with a few partners right now, but nothing is concrete yet. Chrysler CEO Eric Ridenour says to think of them as “semi-finalists”, but refused to reveal who it is talking to.

Chrysler wants to make a new sub-compact car to market globally, including in the United States. It needs a partner because it has not much expertise in making small cars, and there is a huge investment involved in designing, manufacturing and marketing a new car. Chrysler’s new sub-compact car could take on the styling cues of the 2006 Dodge Hornet Concept (picture above), shown at the 2006 Geneva Auto Show.

Previously, there were rumours that this partner would be Chery Automobile, a Chinese automotive manufacturer. Subcompacts account for 1% of the overall US market currently, but it is expected to double in amount in the year 2007, as gas prices continue to rise. Sub-compacts are known to have frugal fuel consumption.

The Dodge Hornet Concept is a 5-door hatchback slightly larger than a MINI Cooper. It made it’s world debut back in February 2006 at the 2006 Geneva Motor Show. The Dodge Hornet Concept was conceived after meeting were held regarding requests from U.S. Dealers for a true entry level Dodge vehicle below the Dodge Caliber which retailed for about USD13,000.

Click here to read the rest of 2006 Dodge Hornet Concept

Chrysler is looking into using Chery Automobile to assemble a small car for the international non-US market. The car will be sold under the Dodge or Chrysler brand. This could allow Chrysler and Dodge to enter third-world markets like South East Asia, which are not big fans of Chrysler’s big cars with huge fuel-guzzling engines.

Daimler Chrysler already has an existing partnership with a Chinese company, Beijing Automotive Industry Corp. The joint venture assembles SUVs for Daimler Chrysler and recently the Mercedes Benz E-Class. But the JV company lacks experience and skills to manufacture small cars, which Chery has.

Chrysler could be seeking to produce the Dodge Hornet concept, a small B-segment vehicle smaller than Dodge’s smallest car, the Dodge Neon. The Dodge Hornet Concept was shown at the Geneva Motor Show in March 2006.