What ARE we going to do, Chrysler?

See the part where I said Chrysler was already making mistakes? The

78-79 Magnum name was also a mistake. In more ways than one...

All that says is that they ran out of their inventory of froggy lights and wood trim before the last few runs hit the assembly lines. And why order more since the lines were going OUT OF PRODUCTION.

Sorta like there were some "1976" Darts and Valiants sold right along beside the 1976 Aspens and Volares that (shamefully) replaced them, but they were just extended production of the '75 models to help fill demand while the replacement vehicle production ramped up.

*IF* you're interested in reading up on this, there's an active day-old thread going on right now on the 300M ezBoard in which they are putting together a yearly option chart on the 300M. It's kind of a hodge podge of partial lists at this point, but maybesomeone will consolodate all of the correct info. into one easy-to-readchart soon. FWIW... Bill Putney (to reply by e-mail, replace the last letter of the alphabet in my address with "x")

Wrong Wrong Wrong.

What are the odds that Car & Driver or Consumer Reports ran a tech article?

Yup, that's an old trick.

I find it quite hillarious that ol' Llloyd who nary lets a day go by without chastising someone for their reading ability, totally choked on that one.

Bob Lutz is just now starting to come out and speak against what has happened since 1998. His loudest vote of disapproval was the fact that he didn't even stick around in his office long enough to be welcomed by Juergen.

I have read the first version of his book. He reserved judgment on the merger then.

He's not been so kind recently:

Flint: Bob's Your Uncle Maximum Bob slings a wisely aimed arrow at Auburn Hills. by Jerry Flint (2003-10-20)

Bob Lutz doesn't dump on people. The vice chairman of General Motors Corp. is one of those loyalty up and loyalty down guys. So if he is just the least bit critical, you should listen.

You recall that he was president and then vice chairman at Chrysler and leader of the product renaissance there. He left after the Daimler takeover and he is finally saying a few words about what went wrong.

They are in a new edition, revised and updated, of his book, Guts, $27.95

from John Wiley & Sons and worth the money, even if you read the old version.

Let me read what he says of the early days of the takeover at Chrysler:

"If the German top management didn't send in the troops, they sure did send the message that the projected sales, profit, and market share numbers were to be delivered, no excuse! Lacking familiarity with their new European bosses, it's perhaps not surprising that U.S. Chrysler team executives chose not to try to explain the inevitability of 'missing the numbers,' with a concomitant new, more realistic action plan, including cost cutting to follow."

In other words, things started to go wrong and the Americans were afraid to tell the Germans and deal with the problems realistically. Instead they put too many vehicles out on lease instead of cutting production and missing those numbers.

And get this:

"I personally believe it's fair to say that DaimlerChrysler CEO Juergen

Schrempp's bearing, demeanor, and speech do, perhaps unwittingly, trigger fear and intimidation. He is not your favorite jovial uncle who kicks back i n the La-Z-Boy and kindly asks, "Having some problems, are we? Come and tell Uncle Juergen all about it. I'm sure we can find a solution."

"In the parlance of business, 'Desperate men do desperate things.' Needing to buy time, they (the Americans running Chrysler) gambled that an

incredibly buoyant used-car market two years down the road would soak up all those off-lease vehicles. It didn't."

In another situation I remember hearing another high-ranking German - this one headed the Premier Auto Group at Ford - lecturing Volvo people about "making the numbers." He was so offensive that one of the Volvo executives at my table exploded. "I don't have to take this. I'm quitting," he said then and there. He had a house in Colorado and some General Electric stock that had done quite well. He didn't have to take it.

Wagons ho?

Another problem I see coming at Chrysler. I was at a New York preview of the coming-next-spring Chrysler 300 and Dodge Magnum vehicles. These are rear-wheel drive, with a premium optional engine, the Hemi V-8.

Personally, I like these vehicles. Some auto writers don't but I do. But there's trouble. The Chrysler 300 is a sedan coming in four versions, priced, my guess, from $26,000 to near $40,000 with the Hemi. But there is no Dodge sedan to replace the old Intrepid. Instead there is a station wagon. They may call it a "sports tourer" but it is a station wagon. No large sedan for Dodge. I'm not saying it's not nice, but how many station wagons can you sell?

Look at Dodge Intrepid sales over the years:

2002 111,356 2001 109,098 2000 143,840 1999 144,355

This Intrepid is a pretty old car, but it still sells well. Chrysler says it's heavily sold to fleets but you've got to wonder why. The 2003 is on Consumer Reports' recommended list. It's good looking and roomy. It's probably been hurt by Chrysler's weak quality reputation and weak engines.

Sales have fallen off as it's aged and the Dodge dealers focused on trucks, meaning Caravan minivans, Dodge Ram and Dakota pickups and Durango SUVs, almost three trucks sold for each car.

But still, if there were a rear-wheel drive Dodge Magnum sedan replacing the old Intrepid, you would think it would sell well. But a station wagon?

Minivans and SUVs have generally replaced the wagon and for good reason, they can carry more. There are some high-priced Mercedes and BMW wagons sold, some. Ford's Taurus, which had the best-selling wagon, is down to about 30,000 a year and may be abandoned in another year.

When I saw the new Chrysler sedan and Dodge Magnum wagon, I asked who decided not to have a Dodge sedan. I got no answer.

Of course, it's possible to do a Dodge Magnum sedan if the wagon is not a home run, but that means two more years. Lots of bad things can happen in two years. And probably will.

characterized

Why? It's a great engine, better than any V-6 for sure.

Huh?

Read for comprehension, Lloyd, he didn't say that the whole engine had changed, just that they copied the valvetrain from the old AMC V-8 rather than continuing the evolution of what they'd been doing with the LA previously.

nate

I didn't think I'd have to go to this length to prove it to you, but dispute this Lloyd:

DaimlerChrysler: Equals No More

In the year before its merger with Daimler-Benz, Chrysler was the most profitable auto company in the world. But a series of missteps by executives on both sides of the Atlantic has turned the merged DaimlerChrysler's U.S. operations into a cash vacuum. Now the company has tapped two longtime Daimler executives to come clean up the mess. They're going to have a tough time keeping morale up among U.S. employees, who now realize their boss is

4,000 miles away.

DaimlerChrysler Management Change Announcement

By Bill Mann (TMF Otter) November 20, 2000

Chrysler Corp. was the most profitable auto manufacturer in the world -- with 1998 net profits exceeding $500 million -- in the year leading up to its merger with Daimler-Benz. As the slaying of the golden goose that was Chrysler came to culmination this last week, DaimlerChrysler (NYSE: DCX), the only auto manufacturer in the FOOL 50, announced that it was replacing the head of Chrysler with two longtime Daimler executives.

Thus ends any notion that the vaunted "merger of equals" between the U.S. company and the German one was actually that, though the fact that the company's 12-seat board of directors includes only two Americans should have been a clue.

Wolfgang Bernhard and Dieter Zetsche will be assuming the roles of COO and CEO, respectively, of DaimlerChrysler's U.S. unit. They are expected to bring Chrysler's spiraling operating costs into line through cost-cutting measures that may include layoffs. (According to reports, they have already begun removing U.S. execs and a worldwide televised address to employees was planned for today.)

Chrysler's already-flagging employee morale drooped further as it became clear that the once-proud American car company's absorption into a foreign entity is now complete. The very things that made Chrysler a great company are now anathema to its German partners. The culture clash may very well be what has triggered the dramatic reversal of fortunes: Where Chrysler had become the American car company most willing to take entrepreneurial risks, Daimler-Benz brought to the table engineering excellence and a culture of strict hierarchy.

Still, the mix of products between the two companies was so fitting that there was at least some belief that the cultures would morph into something ultimately more powerful.

But American market conditions have worsened significantly even as the two companies struggled to combine. And the losses attributable to Chrysler have now severely impacted the parent company's bottom line, with earnings for the fourth quarter of 2000 now expected to be $0.79 per share, as compared to $1.60 last year. Certainly the weakening Euro, the home currency for DaimlerChrysler, does not help the company's comparable earnings, but climbing costs at Chrysler have nevertheless taken a huge divot out of the bottom line.

Enough problems to go around Recriminations are going to come from both sides of the Atlantic, and it's fairly clear that there is enough blame to go around. Recently, Chrysler has had a knack for snatching defeat from the jaws of victory: Even its critically and commercially acclaimed PT Cruiser has caused problems as the company failed to anticipate demand for the $17,000 car. Additionally, Chrysler has had significant competition in its profitable truck divisions, as Toyota (NYSE: TM) has released competent large pickup trucks and Honda's (NYSE: HMC) minivan division has made large gains.

In light of the announcements from last week, the company's stock lost more than 10%. Investors likely want to see gains in Chrysler's top and bottom lines, meaning that the company must realize more competitive lines and at the same time maintain prices and control costs in order to turn things around. Given the fact that the process of bringing new vehicles to market is measured in years rather than months or days, this could be a while in coming.

But from almighty MERCEDES??????????

RE: Like Stratus? Cirrus? Neon? Want to talk about their sales?

I won't have to Lloyd. In a few years, the impending, miserable, Daimler inspired failure of the Mitsubishi based Airflow/Airflite will make even guys like you long for the days when these cars made Chrysler at least a competitor in their respective fields. The Neon has spent some time in the top ten selling models over the years. Pretty respectable for a Chrysler, eh? I can't wait for the Smart either. You know, the next Dodge Dart.

We could spar all month. We'd still find something to pick at each other about.

Fact is, my heart isn't into it like it used to be. Give me the old days when I could debate the merits of the 318 vs. 350 vs. 351 again.

Neither Daimler or Chrysler is totally innocent pertaining to the mess DCX is in now. Chrysler approved the merger and had no clear top management succession plan. The two Bob's hated each other. Kirk Kerkorian was on Bob Eaton like a wet noodle. History will report that the merger was motivated by Eaton fending off Kerkorian's demands to realize shareholder value more than anything else.

Daimler is pretty set on building world presence at any cost. The company has a history of botched acquisitions, big egos, and even suicide in it's corporate management for failure. They've been responsible for much destruction of capital worldwide. There's no doubt they bought Chrysler at it's high in a cycle. Daimler itself hit bottom about just before in

1994-95. To say they are staid and conservative is like saying the sun will come up tomorrow. But they have proven they are not beyond deception to get their way. They recently lost a lawsuit to prove it. And they will probably settle with Kerkorian to avoid an embarrassing verdict in that lawsuit too.

Fact is, things have changed. Changed dramatically. Changed enough that after 40 years of being a Chrysler fan, never owning anything else - raised on the Road Runners and Cuda's of the 60's, and starting my own family in a '93 Grand Caravan, I've been alienated. Not because of mechanical failures. But because the magic is gone for me. It's just not the same anymore. And I know I'm not alone. I can't change your feelings and you can't change mine. The new products are for a new group of buyers. Daimler admits it. I hope they exist. You are at least one for the new group.

I'm unsubscribing from the newsgroup for good now. This stuff breaks my heart.

I won't keep it from you any longer. I traded my Breeze for a Chevrolet TrailBlazer EXT so I could pay Maximum Bob's salary instead of Dieter's. Put that on Dieter's list of accomplishments. He has made something that would have been impossible 5 years ago possible.

Keep that new 300C polished for me. And SINCERELY, good luck!

I've been a stockholder of Chrysler since 88 and now DC. I've followed the corporation pretty closely. I've read all in Business Week, Forbes, and Fortune. I'd wager I know a little more about Chrysler's finances than you.

And he said Chrysler had "lost its way" prior to the merger.

Kind of like Henry Ford, or Stempel at GM?

And lack of promotion. For years, Chrysler has advertised little but its trucks. That started long before the merger.

Not necessarily. The Mercedes E320 wagon, for example, has more cargo space than most SUVs.

It's crude, it doesn't rev, it's noisy, it's slow...

You do realize this is his "opinion" piece, do you not?

Misleading. Chrysler was hurting and going to hurt a lot more. It was the least efficient of the Big 3 -- most employees per car, most man-hours per car. It had no international presence to cushion downturns in the US economy. It had pretty much stopped plowing revenue back into R & D, instead using it to make the balance sheet look good (as you fell for).

Lose billions of dollars every year and you need new management.

Because Americans sold off their Chrysler stock and so have less vote. At the merger, Americans owned around 50% of DC stock. Now it's down to around 20%. You don't have much of a voice when that's the case. You want more Americans in control -- buy DC stock.

"Spiraling operating costs" -- what I mentioned.

Sure, when it was up against Civics and Corollas of 1980s vintage. Now it sucks big time compared to them.

As I said, you wouldn't like anything that doesn't have an ohv V8 with a 4-bbl carburetor and a live rear axle.

Like what? They're still a major shareholder in EADS, the defense consortium that controls Airbus, Eurofighter, and Eurocopter. They've integrated AMG, McLaren, and Ilmor into their operations. What have they botched? Adtranz is the only one I can think of.

Now for botched acquisitions, how about Chrysler's buying Lamborghini and selling it for less than they bought it for? Or Gulfstream? Or their 15% of Maserati?

No, they settled out of court.

They are "god bless America" made it. Buy it! Don't buy from Jap or Chink!

I see it as a good thing, actually. Daimler-Benz owning a *US* company as opposed to Volvo, BMW(still can't believe they let GM buy them out), and so on being bought up by U.S. companies. There has to be some antitrust legislation against GM and Ford buying out half a dozen competitors.

You'd think going from a Chrysler made product to a Mercedes made product would be seen by him as a huge step forward, much as Ford's buying out Jaguar was.

When Chrysler became a division of a German company it's stock had to come off the S&P 500. Because many or most institutional investors have holdings based on the S&P, they had to sell DCX to re-align their portfolios.