Bailout for the Big Three?? How will it help??

What I've been saying is that Chrysler needs to focus its attention squarely on the North American market and not get distracted trying to sell its products in countries where, for a variety of reasons, it's not likely to perform well. It goes to the point I made earlier, that if you can't sell North American cars to North American car buyers who, in the past, have been largely loyal to you, it's not likely you'll fair much better in foreign markets where the general public is even more committed to supporting their own domestic manufacturers.

It's not like $4.00 gas jumped out of the blue and smacked Chrysler in the face. Like GM and Ford, they chose to ignore the fact that America was becoming increasingly more dependent on foreign oil, most of which originating in countries that don't exactly like the U.S. -- did they simply forget the '70s? And, yet, they've done everything in their power to expand their full-size luxury truck and SUV sales, whist efffectively abandoning the passenger vehicle segment to foreign competitors.

And North American car buyers have, for the most part, rejected them. I read this morning that, in 2008, the Dodge Caliber hatchback has sold for an average of $1,717.00 *less* than a Honda Civic. Why then, even with this price premium, does the Honda Civic outsell the Dodge Caliber by, what, I'm guessing, ten to one?

The same ones that, as noted above and in my previous posts, are

*more* expensive than the domestics?

I'm sorry, did I fail to mention the 25% import duty that applies to foreign made trucks?

Actually, I can and I will. My point is that Chrysler has bigger fish to fry right now than worring about an 8% duty on cars it doesn't sell in Korea.

The '74 Dodge Challenger was my first car and so the 2009 Challenger holds considerable appeal. However, I've decided my next car will be a hybrid or, better yet, plug-in hybrid. Don't get me wrong, a 5.7 or

6.1L Hemi Challenger would be an incredible ride, but I'm not convinced it's the type of car I want to be driving now or two to three years from now, given the general direction of our economy.

Cheers, Paul

Reply to
Paul M. Eldridge
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The whole world is entering a recession, possibly deflationary in nature.

Most every sector of every economy is shedding jobs.

The US auto industry has been maligned as inept and foolish, but the big-3 have done better than most mega-corporations in other sectors. How many airlines have been in and out of bankruptcy protection over the past 10 years?

How many technology, energy, telecom, banks and financial services corporations have folded or have seen their share prices reduced to penny-stock value in the past 10 years?

There is no correct path for any company right now. Every company is in survival mode as consumers flee the markets. Now is not the time for the big-3 to hatch long-term product planning and expensive R&D. Now is the time to reduce costs and hunker down and hope for the best.

The big-3 have roughly 50% market share in the US. Saying that they "can't sell North-American cars to North American buyers" is hyperbole.

More hyperbole.

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The Caliber does sell $1,717 less then the average Civic, but that's better then the Chevy Cobalt and Ford Focus, which sell for $4,192 and $3,371 less than the Civic.

However, Caliber 2008 sales (through the end of October) are less than half of Focus sales (176k Focus) with Civic volume of about 304k units.

---------------- If the Detroit Three lower their labor costs, and retool to build more compact and subcompact cars, but still have to get by on $3,000 to $4,000 per car less than what Honda takes in for each Civic, they will face a painful struggle to survive.

It will take years for Ford, Chevy and Dodge to heal the damage done to their small car brands by years of second-tier quality, uninspired styling and technology, and marketing strategies that focused on filling rental-car fleets at the expense of resale values.

----------

Translation: The US Big-3 have never before relied so heavily on sales of their low-end cars as much as they do now.

Advertizing.

You can get a Challenger with the 3.5L engine.

I have no problems getting 26 - 28 MPG on the highway in my 9-year-old

300M with the 3.5L.
Reply to
MoPar Man

Forgive me if this sounds flippant, but have the big-3 done much in the way of long-term product planning and expensive R&D relative to their peers? If what we have today is the result of long-term product planning, please let these folks be the first in line to receive their termination slips.

Year after year, the big-3 continue to lose market share to their foreign competition and I don't see this trend reversing anytime soon. BTW, isn't calling GM, Ford and Chrysler the "big-3" somewhat hyperbolic in itself now that Toyota's sales surpass those of both Ford and Chrysler?

Perhaps we measure success differently. Toyota sells 3.4 times more passenger cars than Chrysler; Honda outsells Chrysler 2.2:1 and Nissan

1.5:1.

Advertising? That's it? Well the folks on Madison Ave. will be pleased to hear that.

It's not just a matter of good gas milage. If that were the case, I could choose from any number of fuel-efficient sub-compacts. I want a plug-in hybrid because that's the type of vehicle I want to drive.

Cheers, Paul

Reply to
Paul M. Eldridge

The Big-3 (B3) all produce a mix of cars that satisfy a variety of consumer needs, including fuel efficient small compacts.

If the buying public in the US/Canada prefers to buy a foreign vehicle of any particular class or catagory or if they would only buy a B3 vehicle only if priced substantially lower than a competing foreign model, then the reasons for this should be discussed here.

Continuously stating that the B3 are losing sales to foreign (or more specifically, asian) cars because they are not making the correct mix vehicle types is flat-out wrong.

What we have today is the result of 2 decades of consumer perception that B3 cars are inferior to asian cars, combined with a tax and tariff structure that favors asian car sales in the US.

They've lost market share because there are more foreign players with more models in the market today vs 4 years ago.

And they will continue to lose market share as the US dollar appreciates vs other currencies in this current climate of economic fear (or terror). As global stock markets tank and commodity prices fall, the US dollar is (or will) be seen as the only asset to hold that will not decline in value vs anything else, hence this will put extreme pressure on all US manufacturing (not just the B3).

GM, Ford and Chrysler have collectively been called "the big-3" by the north american media for years, and probably got that name when there were other US car makers still operating (like AMC).

I use the term "Big 3" because it's faster to type than the names of the

3 US car makers, which we are lumping together here for the purpose of this thread.

We know there are size differences between the various car companies. We know that Chrysler has always been the smallest of the B3, and is smaller than Toyota and probably Honda as well (in the global sense).

The real issue is the change of North American market share and relative profitability between the various players. Over the past 4 years, the B3 have gone from almost 60% market share to just under 50%. I don't know who of the B3 lost more of their share.

Even the Prius is not a "plug-in" hybrid.

I don't know who makes a "plug-in" hybrid.

And I'll tell you that the consumer market is just beginning to build an experience base for electric power storage in cars, and it will take another 10 years before we know just how ergonomic and economical those batteries will be.

Plug-in vehicles (either totally electric or hybrid) will create their own social problems, and soon, as people drive around with extension cords and try to charge-up using any exterior outlet they can find on any building, shed, or utility pole (essentially stealing power).

Reply to
MoPar Man

We've been walloped by high crude oil prices and now, in no small part because of this, the economy is going into a nose dive. Neither of these two events should come as any surprise. We all knew -- or should have known -- the risks of being heavily dependent upon imported oil and we've known that the marginal cost of new supplies is steadily trending upward. We also knew that many North American consumers were living well beyond their means and that sooner or later these personal debt loads would become unsustainable. This is not the type of market that favours a large portfolio of full-size luxury trucks and SUVs, and to be financially dependent upon this one segment is, quite frankly, an error in judgement of monumental proportions.

In addition, there's a growing awareness of how the choices we make as consumers has a direct impact on our environment and our relations with others. Those who are genuinely concerned about global climate change, resource depletion, rampant consumerism, invading sovereign nations under the pretence of routing-out terrorism and championing world democracy when we all knew damn well the only reason was to steal their oil, view trucks and SUVs as a shining example of all that is wrong in this world.

I know many folks who won't ever consider a domestic vehicle either because of their poor past experience with the big-3 or because they've bought imports in the past and they're quite content to stick with what they know and like. That's the reality facing the big-3 and we can't simply wish it away.

Well, if they can't significantly trim their costs and thereby adjust to a shrinking market or, alternatively, regain some of this lost market share, their future looks particularly grim. We might as well post a "do not resuscitate" sign next to their death bed.

Fair enough. There are other examples of commonly used expressions that no longer accurately reflect current circumstances.

As stated before, the big-3 have, for all intents and purposes, forfeited the passenger vehicle market, choosing, instead, to concentrate their attention on the previously more profitable light truck and SUV segment. No doubt it seemed like a reasonable strategy at the time, but being heavily dependent on a single product group is not without risk, as we can clearly see, and it does nothing to address the fundamental weaknesses that underlie this choice.

No one as yet, but I expect that will change within the next two to three years and by that point my 2002 300M will be due for replacement.

Well, we'll have to see how it all shakes out. For now, I'll worry about gas being siphoned from my tank.

Cheers, Paul

Reply to
Paul M. Eldridge

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Reply to
Jalapeno

The "foreign" manufacturers also produce a larger variety of cars. The B3 got stuck on trucks, even some of their cars look like trucks, particularly Chrysler's.

The USA dollar appreciation is temporary, it will drop next year.

I know the Toyota Prius battery lasts the 8 year guarantee period, based on a friend who has a 2000 Prius still going strong.

The big problem will be supplying the huge amount of electricity. Big expansion of electric generating capacity will be needed. Solar cells on the roofs of plug in electric vehicles would help.

Reply to
Some O

That's a pretty wimpy distance. I'd need another car for a good percentage of my urban trips.

Much more work is needed on the distance.

Reply to
Some O

That may be. I don't know. It may be that simply changing some exterior trim on a Civic turns it into a different model.

Blame Chrysler's current vehicle offerings on Germans working for Daimler. They had their own agenda, which was to treat Chrysler as a low-end sister division to Mercedes, and to design Chrysler vehicles with as much Mercedes parts content as possible. That meant lots of

4-wheel drive, and raising the car up to accomodate the extra parts for 4-wd. What you get is more truckish looking cars - and more heavy.

The Pacifica was a good example of lots of effort and cost invested into a vehicle the market did not embrace. The Crossfire is another.

Look at Chrysler's concept for what the 300m was going to evolve into. The Hemi 300N concept was shown at the Detroit auto show in January

2000, and was never seen in public again, because by then it was already under control of Daimler.

Back during 2003 - 2005, Dodge/Chrysler dealers were screaming for new or different models. Everything that was on the drawing board in 1999 -

2001 was scrapped by Daimler. You're not going to get a low-cost compact car when you're using expensive E-class parts imported from Germany.

If it does, then something else will have to go up. What will it be?

The yen? The Euro? Gold? Oil? Potash?

Many people really don't know how a hybrid car works or how the batteries are used.

The battery system in a hybrid is designed pretty much only to capture energy wasted during braking or coasting to a stop, which is encountered mainly in city driving and especially for taxis. Constant speed operation, long-distance commuting with few stops is not a good use of a hybrid.

Here's more:

NiMH batteries used in hybrids are not used as if they were a tank of gas, where you can charge them to 100% and then run them down to close to zero.

The battery control computer in the Prius likes to keep the batteries at around 60% charge, and only let the battery level vary around 10 to

15%. So the battey is rarely more than 75% or less then 45% charged. What is displayed on the dashboard screen in the Prius is not be the true charge state of the battery, but is scaled based on the 75% / 45% charge targets. This pattern results in the LONGEST LASTING battery life.

Also note that if a hybrid battery starts to fail or lose capacity in a hybrid, it will resort to using it's gasoline engine more and more as the battery loses capacity. This will be gradual, and hard for the driver / owner to notice.

For a pure electric vehicle, a failing battery system can't be tolerated, and a reduction in the distance between charges will be quickly noticed by the driver.

Actually - no. If we're talking about a mass adoption of gas-electric hybrids, then we're not looking at much, or any, additional load to the electricity grid. Remember that the Prius does not (from the factory) have the ability to be plug-in charged. There is no need, because it's battery system is not large enough, nor designed, to be the main energy source for the vehicle.

Reply to
MoPar Man

Sometimes it's not accurate to compare report figures. Different manufactures are involved in differing market sectors. Subaru has a very limited market. If you compare them against direct competitors of other manufactures Subaru didn't do so well.

Reply to
Miles

If they make the cars we want well buy them. I haven't seen one I would buy new for many years.

Yet the "foreign" makes have several cars I'd buy.

Reply to
Josh S

Certainly Daimler wanted Chrysler to complement Dalimer's vehicles and to obtain production efficiencies through shared production. The FWD 300M being replaced by the RWD 300 (Mafia car my dealer says) is the result or sharing the drive train and engine. The Caliper and Compass have some very good technology, I particularly like the Compass's profile and rear views, but the Jeep (read truck) front end is just something I park in my driveway. The Nissan Rogue, with almost identical drive train, is quite acceptable to me.

Reply to
Some O

Hear hear!!!

Reply to
Some O

They don't make much profit on their smaller cars because they are built to be cheap, as well as small. I've owned several, both NS and import.

Most of our Japanese cars are built in NAFTA, most in the USA or Canada. Take the Civic and RAV4 built in Canada; Camry and various Hyundai models built in the USA; Nissan Versa built in Mexico where Chrysler built the Neon as well as other models. Then there's the Fusion from Mexico. The Nissan Rogue has been coming from Japan, but I hear a USA plant is being built. GM is dumping small cars from Korea, my oh my!

Reply to
Some O

I expect the German's running Chrysler didn't understand that.

Me too and if it weren't for being lucky and finding an excelent condition 300M I would be driving 'foreign" today.

BTW that 300 totally turns me off. As I said to a Chrysler dealer, even if the 300 was FWD I'd never buy it.

Reply to
Josh S

Actually- yes. More Hybrids will become plug in, where they can travel

40+ miles on battery alone. The gas engine is only used for extended trips or for additional power. Much commuting could be done on plug in power alone. The Volt is of this type, I've read the Prius will also have this plug in capability. The Volt type of vehicle definitely interests me. I could get by with the one car I have now, yet enjoy excellent urban mileage and long distance highway driving.
Reply to
Some O

In 2006, Chrysler built 2.7 million vehicles (a drop of 4.5% compared to

2005), of which 556k were sold outside the US (220k in Canada, 131k units in Mexico). Giving a total of 214k outside NA or 17.8k vehicles per month.

"... the company's minivans and larger Jeep models, like Commander and Grand Cherokee, are surprisingly popular in Europe."

In Q2 2007, Chrysler (then owned by Daimler) was selling about 15k to

18k cars per month outside North America. 9.5k of those were sold in western Europe. The Caliber is the top seller outside NA. In the first 4 months of 2007, Chrysler sold a total of 71k cars outside NA (average of 17.75k cars/month). One source claims these numbers are 10% to 15% higher year over year vs 2006.

During the first 8 months of 2008, sales of Chrysler vehicles outside NA _fell_ 12% year-over-year to 70.5k units (8.8k / month).

I'm sure that would help. The import taxes in foreign markets must be significant.

See also:

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------------------ January 4 / 2007

Launch of Chrysler Sebring in China

Production of the new Chrysler Sebring sedan for the China market will begin later this year in Beijing at Beijing-Benz DaimlerChrysler Automotive Co. (BBDC). BBDC is a joint venture between the Beijing Automotive Industry Holding Co. Ltd. and DaimlerChrysler.

Production of the Sebring leverages assembly capacity at the new BBDC plant, which also builds the Chrysler 300C, the Mercedes-Benz E-Class and Mitsubishi Outlander. Four-cylinder World Engines for the Sebring will be built at the Global Engine Manufacturing Alliance (GEMA) plant in Dundee, Mich. for export to China. GEMA is a joint venture of DaimlerChrysler, Mitsubishi Motors Corp. and Hyundai Motor Co.

Global Business Opportunities

Global partnerships and ventures are part of the Chrysler Group's aggressive drive to create new business models that make sense for today's global automotive environment.

The agreement with Chery - which is dependent on approval by the DaimlerChrysler Supervisory Board and Chinese government - also illustrates the alliance strategy. The partnership allows the Chrysler Group to bring a low-margin subcompact car to market fast, meet targets for low cost and high quality, with minimal capital investment.

Another example of the Chrysler Group's alliance strategy is a licensing agreement, reached last year, which allows Russian automaker GAZ to build the previous-generation Chrysler Sebring and Dodge Stratus sedans for sale in Russia under the GAZ brand. As part of the deal, GAZ purchased manufacturing tooling from Chrysler Group's Sterling Heights (Mich.) Assembly Plant where the sedans had previously been built, enabling the Chrysler Group to maximize its assets. Engines for the sedans and other vehicles being built by GAZ will be supplied by the Chrysler Group plant in Saltillo, Mexico.

Reply to
MoPar Man

So what's the evidence for your point, post-dictator?

"...keeping them from entering foreign markets..."

Are you just a xenophobe you can't bear the idea that an American company is/was owned by a European one so having a go at Daimler Germany?

Nor can you advance your arguments -- which appear quite confused -- with supposition

"... The import taxes in foreign markets must be significant."

In Europe it isn't.

Chrysler has failed manufacturing ventures in Europe going back to well before Mercedes's ownership. Ford and GM have fared much better (GM has owned Adam Opel since the twenties, for example).

DAS

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

Reply to
Dori A Schmetterling

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