This story illustrates that Chrysler will not survive selling rolling coffins badged as Fiat-500's because the buying public in the US and Canada do not want micro cars.
And it's too bad that Chrysler has only trucks and SUV's to offer, and
not any decent sedans. My 11.5 year old Chrysler 300m is doing fine,
still on it's original factory battery no less, but I'd like to buy a
I'd like to buy the 300N, an LH-based concept car that Chrysler showed
during the '2000 auto show circuit, a car that Daimler made sure would
never see the light of day as they raped Chrysler nearly to death for 7
years and practically destroyed it (Daimler did nothing to import and
sell Chrysler-made vehicles into Europe, for example).
Last Updated: May 24. 2011 1:02AM
Henry Payne/ The Michigan View.com
Chrysler and the White House will celebrate the Detroit icon's $5.9
billion repayment of government loans Tuesday in a ceremony that will be
hailed by both sides for the same reason: The government bailout had
become a liability for both entities.
In fact, government-free Chrysler is hardly off the debt hook, but is
simply refinancing its debt with private rather than public
debt-holders. For its part, the U.S. government will still have a 6.6
percent equity stake in Chrysler (and the Canadian federal and Ontario
provincial gov't will still have something like 2 percent - a detail
omitted by Henry Payne, the author of this story) - but by removing
itself as the company's loan shark, the White House can boast of the
unpopular bailout's success in returning taxpayer loans 6 years ahead of
schedule. That's an important sound-bite in an election year.
But there is one inconvenient truth you won't hear at the Sterling
Heights, Mich. ceremony: Chrysler wouldn't be here had it not defied its
green White House masters. Chrysler's return to profitability is a
direct result of the fabulous success of its SUVs.
The White House hand-picked Fiat to shepherd (if not out-right own)
Chrysler out of bankruptcy in June, 2009 because of Barack Obama's
obsession with remaking Detroit's automakers in the image of their
European peers. Convinced that Americans craved small cars to fight the
warming scourge, the president demanded Fiat bring its best-selling 500
Eurobox to the States as part of the acquisition deal. Obama was
convinced that Fiat could reform the immoral, gas-swigging,
SUV-dependent Chrysler (but Fiat will more than likely destroy Chrysler
in the process, which will no doubt end with the sale of RAM and Jeep to
The exact opposite occurred.
Two years later, the little 500 is about to go on sale in dealer
"boutiques" - but it is the resurgence of America's appetite for trucks
that has brought Chrysler back from the dead. Chrysler Group reported
sales were up 17 percent to 1.1 million vehicles in 2010 on the strength
of its wildly popular, redesigned Jeep Grand Cherokee and Dodge Durango
SUVs. For CEO Marchionne, the SUVs success in the U.S. market has been
a revelation and he is planning to expand the SUV lineup into Europe
with Alfa Romeo and Maserati-badged trucks. Marchionne is no starry-eyed
green - he has realized that trucks like the Cherokee typically rake in
twice the per-vehicle profit of cars (thus the beleaguered company's
speedy repayment of U.S. loans).
Chrysler's truck sales - largely ignored by Obama's green media parrots
- has also been good to UAW workers as Chrysler's Detroit assembly plant
is now at full, three-shift capacity.
But there is one more inconvenient truth: Chrysler has been here before.
After it repaid its 1980s loans under the legendary hand of Lee Iacocca,
Chrysler was unable to diversify into smaller vehicles. Today, as the
truck boom fades before the specter of $4-a-gallon gas, Chrysler is
still heavily dependent on truck sales.
Chrysler is back. But is it just 1980s déjà vu all over again?
- posted 9 years ago