2010 PT Cruiser Couture Edition

In dire need of fresh products to attract customers, but with nothing new to offer, the Chrysler Group is in sad shape. That desperation is all the more evident in recently updated product offerings unveiled this week across its Jeep, Dodge, Ram, and Chrysler lines.

Instead of bringing forth all new models or making significant mid-cycle changes, the product poor Chrysler Group is making do with what it has by offering new packages based on old themes. Long awaited all new models underpinned by Fiat technology are still more than a year away, but the automaker hopes that customers will flock to showrooms based on its repackaged offerings.

Will this move work or will it hurt Chrysler’s image?

The Chrysler Group recently separated its Ram truck line from Dodge, a curious move to say the least. All four brands are offering special or limited edition models many of which were announced yesterday in advance of next week’s North American International Auto Show (NAIAS) in Detroit. Supposedly, these “new” models will be on display when the show kicks off to media on Monday.

But the changes are mostly cosmetic including the Chrysler PT Cruiser Couture Edition, representing Chrysler’s feeble attempt to modify its woefully outdated retro model first introduced in 1999. That PT Cruiser, riding on the extinct Dodge Neon platform, was killed off by Chrysler and later resurrected by Fiat once Chrysler emerged from bankruptcy protection this past summer and was placed in Fiat’s arms. Fiat wanted to keep the PT Cruiser around given that the Chrysler Group’s small car line up had one car left: the Dodge Caliber.

Chrysler describes the latest limited edition PT Cruiser as offering a bold look featuring exterior changes such as “chromed body-side moldings, door handles, 16-inch polished aluminum wheels.” Inside, “chromed detail rings” and “all-new Radar Red leather or Dark Slate Gray seats” highlight this edition’s offerings. The car will go on sale later this quarter for $19,995.

Other changes include:

• The Dodge Caliber receives a redesigned interior.

• The Chrysler 300 gains a pair of new models – S6 and S8, vehicles featuring “blacked-out grilles with chromed surround and body-color fascia accents.”

• Jeep expands the lines of two of its models by introducing the Liberty Renegade as well as the Wrangler Islander and Wrangler Mountain editions, the latter sporting 32 inch tires.

• Dodge Nitro receives changes to sub-model names with Heat, Detonator and Shock emphasizing updates to exterior styling as well as standard equipment changes and a new safety package.

Other changes involve several Dodge models including Avenger, Journey, Challenger, and Viper, as well as for the Chrysler Town & Country.

If Chrysler can hold off for a year, the Fiat 500 will soon be available through select dealers followed by a bevy of new cars, riding on Fiat platforms. But with sales off by 36 percent last year and market share sinking rapidly, time is not on Chrysler’s side nor does it have new vehicles to sustain itself through what promises to be yet another challenging year.

Photo Credit & Source: Chrysler Group LLC

Old Meets New: 26 years of minivan building has yielded 12 million Chrysler, Dodge and Plymouth models. Along with the Ram truck, Chrysler's minivans are a money maker for the automaker.

The twin pillars holding up Chrysler these days are its burly Ram truck line and time honored minivans. That may not sound like much, but when you’re remaking yourself post-bankruptcy and lacking fresh product for consumption, you have to see what works. Pickup trucks remain popular and, surprisingly, the minivan market has bottomed out and stabilized giving industry leader Chrysler a chance to promote one of its chief money makers in the years ahead.

Still Leading The Market

Through September, Chrysler has sold more than 125,000 minivans and still controls 40% of the market with its Chrysler Town & Country and Dodge Grand Caravan models. The Honda Odyssey (now the best selling name plate) and Toyota Sienna have made significant in-roads and are considered to have higher quality ratings than the Chrysler products, but Chrysler is holding its own and looking to gain sales.

After a horrible summer when Chrysler filed for bankruptcy and shut down production in order to reduce inventory and slash expenses, the sales slide has stopped while minivan demand has risen. Indeed, in September Chrysler began to build minivans for overseas markets, equipping some with right hand drive and adding diesel engines (2.8L CRD).

Overseas Market Gains

Outside of North America the “Chrysler Grand Voyager” is available in more than eighty countries, with 21,513 units sold abroad in 2008 alone. To date, more than 12 million Chrysler, Dodge and Plymouth (Voyager) minivans have been built, with the Windsor, Ontario factory producing today’s models and is currently the only Chrysler plant where all three shifts are in operation.

According to The Detroit News, minivans will continue to hold three to four percent of the car market through 2016, as demand for crossovers continues to rise while SUV sales slide. Fortunately for Chrysler, no new minivans are entering the market this year, although Ford will lead the charge with the C-MAX in 2011, a mini minivan from Europe. Around that same time, GM will roll out the Chevrolet Orlando, a mini minivan based on the Chevy Cruze platform.

Smaller Chrysler Vans

Down the line, Chrysler will likely produce a smaller van to compete in the smaller van segment, using a Fiat platform to underpin the body. For now, Chrysler and Dodge dealers will need to work diligently to market what they have, giving the edge to Dodge which has both the Grand Caravan and its line of Ram pickup trucks to draw crowds and to bolster company sales.

Daimler once gave serious consideration to bringing the Imperial back, but scrapped those plans. Fiat wants to elevate Chrysler to battle Lincoln and Cadillac, but me thinks that someone is wearing rose colored eyeware.

Chrysler is in a lot worse shape than anyone at Fiat imagined. At least that’s what several auto pubs are telling us following an announcement from Sergio Marchionne, the erstwhile Mopar savior, stating the same. For those of us who have been following Chrysler in its many different iterations (Chrysler Corporation, DaimlerChrysler, Chrysler LLC and Chrysler Group LLC) that news isn’t surprising at all.

What is surprising is the long range plans Fiat has for Chrysler, Dodge and Jeep. Jeep will continue doing what it does best and that is being Jeep – no surprise there. Dodge will see its muscle car image transform from brute force to driving dynamics. In other words, if Dodge had something equal to Ford’s EcoBoost technology, we might see smaller, yet powerful engines underneath the hood…not much of a surprise there either.

Chrysler Steps Up?

The big surprise is how Fiat SpA envisions the Chrysler brand to look down the road. Fiat would like Chrysler to be a “notch above Lincoln, a notch above Cadillac” which, on the surface, is a ridiculous statement. Chrysler can barely compete with Buick whose own efforts to move upmarket are well underway. Cadillac has the CTS line, which can compete against the best of Europa, while the 2010 SRX is a compelling new crossover designed to burnish the brand’s image. Eventually, a replacement for the STS and DTS will be on the market and, someday, a much improved Escalade will roll out. If the Chevy Volt succeeds, Cadillac will also get a Voltec model. Don’t forget the gorgeous CTS coupe.

I can’t see Chrysler having a shot at upending Cadillac. Not now. Not ever.

A few years back I would have said Lincoln was an attainable goal given the wholesale neglect of the brand by Ford for many years. Now that Aston Martin, Jaguar, Land Rover and soon Volvo will be out of the way, Lincoln will get some loving and eventually should give Cadillac a nice run for top American luxury line billing. The MKZ has improved, the MKS is a decent American full size luxury sedan, while the MKT is competitive with what Europa makes. Look for Ford to update or replace the Navigator and the MKX while the aged Town Car will keep fleet sales humming for a few more years.

Moon Shot Mentality

The thinking at Fiat is reminiscent of the Apollo moon shot program which aggressively set standards for the US to reach the moon by the end of the 1960s. That goal was reached against all odds, nevertheless the resources of the US government working with ardent lunar devotees ensured its success. Chrysler won’t have the same federal support with this program and the company no longer has the staff to bring about luxury products let alone push the Chrysler brand upmarket.

Likely, the recent sermonizing by Fiat was merely eyewash to give people something to hang onto. Fiat realizes that Chrysler is in much worse shape than they thought, a true calamity that will be hard enough to salvage let alone advance. Sure, I wish the best for Chrysler and Fiat, but global competition and economic realities will likely dictate the fast reordering marketplace.

See Also — Is There An Imperial In Chrysler’s Future?

Built by Daimler for Chrysler, the Dodge Sprinter will soon be no more. Instead, select Mercedes dealers will soon begin to sell Daimler's line of commercial vehicles in the US.

Daimler, Chrysler battle continues….

The DaimlerChrysler marriage is over, but the animosity continues. Late last month, Chrysler sued Daimler for breach of contract, alleging that the German automaker wasn’t living up to its obligations as agreed to with the Old Chrysler business and assumed by the New Chrysler. Additionally, Chrysler charged that Daimler was attempting to extort from Chrysler monies for a diesel engine that Daimler agreed to cancel months earlier.

My, what sharp words!

Daimler apparently has decided to strike back, discontinuing supplying Chrysler with its Dodge Sprinter vans, its line of commercial vehicles. Introduced through Dodge dealers for 2003, the Sprinter replaced Chrysler’s aging full sized vans a segment that the American automaker will now have to exit due to the Daimler cancellation.

The Sprinter Returns To Mercedes

Mercedes-Benz USA, LLC announced earlier this week that they would “assume responsibility for the sales, marketing, distribution and service of Mercedes-Benz and Freightliner Sprinter commercial vehicles in the United States.” To that end, a wholly owned subsidiary of Daimler AG was being formed a company to be called Daimler Vans USA, LLC.

The Dodge Sprinter is currently sold through 400 Dodge dealers, but will instead be sold as either a Mercedes or Freightliner product beginning next year. Originally introduced in the US as a Freightliner model in 2001, the vehicle will be sold through select Mercedes dealers.

Fiat Vans To Replace Daimler

For its part, Chrysler Group LLC (the new Chrysler) says that the termination was mutually agreed upon as Chrysler is currently in deep talks with Fiat’s Iveco to supply commercial vehicles (CV) to the US including the Fiat Ducato and the Iveco Daily. Fiat owns a 20% stake in Chrysler, but effectively oversees the US automaker’s business.

To date, more than 130,000 Sprinters have been sold in the US with approximately 100,000 sold through Dodge dealers. Built in Germany, but assembled in South Carolina, the CV is likely to see some changes to it before it goes on sale next year. Currently, the model is available in three body styles and two vehicle lengths and is powered by a 3.0L diesel V6 engine.

No Love Lost

So, what’s next in the Chrysler-Daimler battle? Chrysler continues to accuse Daimler of stripping billions of assets from the automaker before its sale to the Cerberus Capital Management, L.P. Group in 2007. Cerberus is no longer involved with Chrysler, having forfeited its 80.1 percent stake in the automaker when the company declared bankruptcy this spring while Daimler had sold its 19.9 percent stake in Chrysler earlier.

Source: Mercedes-Benz USA

See Also — Ford To Counter The Dodge Sprinter

When Nissan and Chrysler began to make agreements with each other early on in 2008, I thought that their pending arrangements would be good for both companies. Taking Japan’s #3 automaker and putting it with America’s #3 automaker in order to build or share select models and parts seemed like a good idea to me. With Nissan being part of the Renault-Nissan juggernaut and Chrysler freed up from its awful relationship with Daimler, the move was well timed too.

The Ties That Unbind

Fast forward a full year and the global automotive landscape has changed sharply. Suddenly, China is the largest car market in the world, GM and Chrysler have been ushered through bankruptcy, Tata Motors now owns Jaguar and LandRover, while Mahindra & Mahindra will soon be selling its vehicle in the US market. Oh, by the way, Fiat now controls Chrysler which is yet another significant change.

The Nissan-Chrysler partnership came about shortly after Cerberus Capital Management, LP wrested control of Chrysler from Daimler in late 2007. By Spring 2008, the first product tie-ins between Nissan and Chrysler were announced and included the following arrangements:

• Nissan agreed to build a small car for Chrysler which was to be sold throughout much of Latin America. That model, supposedly a compact, would have helped Chrysler expand its reach in a booming, yet competitive market.

• Nissan agreed to supply the platform and quite possibly the entire body which was to replace the midsize Dodge Avenger and Chrysler Sebring sedans. That car was to be built at a Tennessee factory by Nissan for Chrysler.

• Chrysler agreed to supply the truck platform expected to underpin the next generation Nissan Titan, the automaker’s full sized truck. Based on the Ram platform, Nissan would use many Dodge components and quite possibly become the basis for the next generation Armada (big SUV).

Don’t Count Everything Dead Yet

The first two agreements are dead for the simple reason that Fiat will supply everything that Chrysler lacks going forward. However, the Dodge Ram-Nissan Titan deal could still come through especially since that plan wasn’t expected to begin until 2011.

Volume for the Titan is considered to be too low to justify making an all new model, thus Nissan will likely still need a partner or kill the model which is something the automaker insists won’t happen. Chrysler is the logical choice, so don’t kill this partnership off completely. At least just not yet.

Source: The Detroit News

See Also — Nissan, Chrysler Fuse Partnership

Chrysler's beloved panel truck -- the PT Cruiser -- will not be riding off into the sunset...yet. Fiat intervention will extend the Cruiser's life, perhaps all the way through 2010 at that.

With a show of hands, how many of you thought that Chrysler wouldn’t ever restart production after shutting everything down on April 30th thanks to it bankruptcy filing? I’ll put my hand half way up because I expected that Chrysler would be around in some fashion, but I hadn’t expected that they’d be producing cars again so soon.

Just one week after emerging from bankruptcy protection and selling its assets to Fiat SpA, the newly minted Chrysler Group LLC is back in action. What’s more, the Dodge Viper, the sports car brand that was supposed to have been sold months ago, is leading the charge as the Conner Avenue facility in Detroit has already resumed production. Seven additional plants are scheduled to be back online on June 29th.

Though the seven plants – Sterling Heights Assembly Plant, Warren Truck Assembly Plant, St. Louis North Assembly Plant, Toledo Supplier Park, Brampton Assembly Plant, Windsor Assembly Plant and Toluca Assembly Plant – should be up and running as planned, they’ll be shut down for two weeks beginning July 13th, as part of previously announced summer breaks. A follow up announcement regarding additional plant restarts is expected.

Chrysler PT Cruiser Lives On

Having first rescued the Dodge Viper, Fiat apparently has rescued the Chrysler PT Cruiser, a retro-styled sedan based on the defunct Dodge Neon platform. Like Viper, Chrysler has tried to sell the PT Cruiser, with rumors that a Chinese firm might be interested in acquiring the model line.

Introduced for the 2000 model year, the PT Cruiser is expected to soldier on until December 2010 when the Toluca, Mexico plant where it is built will be retooled to produce the Fiat 500 and one other Fiat model according to Automobile magazine. By then, the truly aged PT Cruiser will be eleven years old, about double the life cycle for today’s models.

What Fiat Wants, Fiat Gets

The life extensions for both the Viper and the PT Cruiser reflects Chrysler’s new realties – whatever CEO Sergio Marchionne wants, is what he’ll get. That may mean that whatever other plans Chrysler has announced over the past six months to a year will get reviewed, possibly reversed. In addition, new product roll out and production planning will likely change, as Chrysler comes under the firm control of Fiat.

I’ll bet you that Chrysler’s relationship with Fiat will be vastly different than the bitter relationship that they had with Daimler. Let’s see some hands if you agree!

Sources: Chrysler Group LLC and Automobile Magazine

See Also — Cerberus Denies Interest In Selling Chrysler Piecemeal

Adding insult to injury, Devon Motorworks appears to have made a $5.5 million offer for the Dodge Viper, well below the $10 million fire sale price that Chrysler LLC has reportedly been asking for its iconic sports car line. Based in Grand Rapids, Michigan, Devon Motorworks is building its own supercar based on, you guessed it, the platform underpinning the Viper.

According to an article published in Wednesday’s issue of The Wall Street Journal,  Devon made a May 15th offer to purchase the Viper brand and to lease the Detroit assembly plant that builds the car until December. Devon must still demonstrate its financial wherewithal in order to have its bid considered but it isn’t known whether they have done so or not.

Lots Of Tire Kickers, No Serious Buyers

Chrysler LLC continues to insist that a number of parties have expressed interest in the Dodge Viper, but no one has approached the ten million dollar figure that Chrysler is asking.

Many automotive enthusiasts are stunned by the low asking price for the Viper, but given the current state of affairs for the global automotive industry it would seem that most automotive assets would fetch far less money today than they would have as recently as a year ago. That’s bad news for Ford which is trying to sell off Volvo and for GM who is looking to sell off Saab, Hummer and Saturn while finding an investor for Opel.

Devon GTX To Tackle “The Ring”

Scott Devon created Devon Motorworks which hopes to release the Devon GTX in the near future. Designed by Daniel Paulin, a Swedish automotive designer whose clients include Hyundai, Tata Motors and Volvo Trucks, the GTX will attempt to break the world lap record at the famous Nürburgring “The Ring” track in Germany this July. Le Mans, European FIA and GT2 World Champion and Trans-Am winner Justin Bell will be behind the wheel of the GTX when it makes its way around the German track.

Scott Devon, the owner of Devon Motorworks, also owns Cole’s Quality Foods Inc., a company who makes frozen breads, cheesticks, pizza sticks and bread sticks.  In addition, Devon Motorworks produces an electric bike that comes with a portable battery pack and can travel as fast as 60 mph.

Chrysler LLC is expected to emerge from bankruptcy within the next few days which means that its business will be sold to a group of automotive investors led by Italy’s Fiat SpA group.  It’ll be up to them to decide what to do with the Viper, but my thinking is that the company which builds Ferrari, Maserati and Alfa Romeo performance cars may still see some value in keeping the Viper within the Dodge fold.

Last summer Chrysler LLC mentioned that its iconic sports car, the Dodge Viper, was up for sale. No, not just one car but the entire model line, the tooling and the factory in Detroit where the Viper is built. Back then, some were speculating that Viper could raise perhaps as much as a few hundred million dollars for Chrysler who was putting the model up for sale even before the big financial meltdown of September 2008.

Well, the people reporting at The Detroit Bureau (an excellent online publication by the way) have shared that Chrysler’s asking price for the Viper is a measly ten million dollars. That’s right: low enough for a bunch of us auto enthusiasts to pool our money together to buy Viper ourselves. Had we known, we might have submitted our own bid.

Fire Sale Price For Automotive Assets

Perhaps most surprising of all is that even at this fire sale price, there hasn’t been a single party to express interest in Viper. Gosh, let’s get ten people together to scrounge up $100,000 each and offer Chrysler an even one million dollars to take Viper off of their hands! No thanks.

As The Detroit Bureau mentioned, none of this bodes well for other automotive assets on the market, namely GM’s Saab, Hummer and Saturn brands. Moreover, with Volvo up for sale, you have to wonder if Ford would get anything near the five or six billion dollars they want for the Swedish make. In my opinion, if Ford is able to do so they should simply hang on to Volvo and ride out the depressed market.

What Is The Value Of Car Assets?

Perhaps most interesting of all is this point — exactly what is the federal government funding when it comes to helping Chrysler and General Motors? When all is said and done tens of billions will be expended to move Chrysler to Fiat and hundreds of billions to lift General Motors out of its own ditch. Perhaps the feds have overestimated each company’s actual value?

No demand for the Viper actually plays into the fed’s hands when it comes to settling Chrysler and GM’s debt as pertaining to its bondholders. Holders of Chrysler and GM debt are not happy to get what amounts to be just pennies on the dollar for their investments, but with the federal government as the only party interested in shoring up the two companies, whatever they end up getting will be more than what these assets are probably really worth which is as close to no value whatsoever.

See Also — Dodge Viper, The Heart And Soul Of Dodge

I just didn’t have it in me yesterday to tune into the Chrysler LLC conference call which followed the company’s dealership cut announcement earlier that morning. I followed some of the action on Twitter and then looked around locally to see who got whacked in the Raleigh, NC area where I live.

Turns out that at least 25 dealerships in the two Carolinas got hit, including Southern States Dodge in Raleigh, Johnson Chrysler-Dodge-Jeep in Durham, Goldsboro Chrysler-Dodge-Jeep and Williamson Motors in Clinton according to WRAL.com. I can’t say that any of thee surprised me, given that I pretty much know which dealerships near me seem to have the size to survive. Still, I am sure that it was a shock to dealership employees and owners that Chrysler LLC would be giving them the heave-ho.

One Quarter Of All Dealerships Must Close

All told, some 789 dealers will be shut down by Chrysler no later than June 9th, removing 25% of its total. Operating under federal bankruptcy protection, Chrysler is allowing dealers to appeal although for the lowest volume dealerships a stay of execution seems unlikely.

Yesterday morning, Chrysler filed paperwork with the U.S. Bankruptcy Court seeking to reject certain U.S. dealer agreements, and a list of U.S. dealer agreements to be assigned to the buyer of its business assets. Those dealerships who pass muster will become part of Chrysler’s pending alliance with Fiat once the sale is complete.

In response to the pending closure and loss of jobs, Chrysler shared the following announcement:

“We are in the process of revitalizing Chrysler’s business to succeed as a viable enterprise under new ownership in the future,” said Jim Press, Vice Chairman and President. “The unprecedented decline in the industry has had a significant impact on our sales and forced us to reduce production levels to better match the needs of the market. With the downsizing of operations after the sale and reduction of plants and production, similar reductions must be made to the size of the dealer body. We appreciate the support of our dealers and regret this painful action. We wish market conditions made it possible to keep everyone.”

Company Sets Up A Special Website

To help shepherd Chrysler through bankruptcy, the company has set up a special website, ChryslerRestructuring.com, to disseminate information about the changes coming forth.  On that site visitors can pull up key documents, review filed claims & schedules and see other details related to the bankruptcy filing.

Source: Chrysler LLC

Perhaps the most glaring sign demonstrating just how desperate the automaker is, Chrysler is putting as much as $6000 in cash incentives on most of its new 2009 vehicles. The incentives, which began yesterday and continue through June 1, 2009, are the steepest and most wide ranging yet for the beleaguered automaker, a company currently under bankruptcy protection and seeking to emerge leaner and part of Fiat’s global network within the next few months.

Save Big Bucks On Your Favorite Ride

At stake for the Chrysler, Jeep or Dodge shopper is $4000 consumer cash; $1000 in loyalty cash for current Dodge, Jeep and Chrysler owners; and an additional $1000 if buyers decide to finance their purchase through participating credit unions. This could mean that the buyer of a 2009 Dodge Caliber SXT Sport Appearance with an MSRP of $19,610 may be able to get that car for just $13,610 with all incentives included.

Chrysler says that more than 1,500 credit unions in all 50 states are participating in what is called the “Invest in America” program, a plan offering qualified credit union members low-rate financing on new vehicle purchases  as well as that $1000 cash bonus.

Chrysler Loses Billions, Files For Bankruptcy Protection

Bankrupt Chrysler LLC lost billions of dollars in 2008, but because the company was part of a private equity firm, Cerberus Capital Limited, LP during that time, it wasn’t required to share financial data. Some reports have pegged Chrysler’s 2008 losses at $8 billion while others have said that they were as high as $17 billion which may have included factoring in loss revenue due to a precipitous drop in sales.

Right now, Chrysler has shut down most of its factory network in a bid to reduce inventory and to trim model lines. The plan has Chrysler restarting factory production when it emerges from bankruptcy, an ambitious plan that the Obama administration hopes will be completed within sixty day’s of its April 30th filing.

The American Taxpayer’s Gift To Chrysler

Buried inside of the bankruptcy filing was a notation that Chrysler would NOT repay more than seven billion dollars in monies lent by American taxpayers since late last year. Specifically, the automaker would be forgiven the $4 billion bridge loan offered by the Bush administration at year end 2008, a related $300 million fee on that loan as well as the $3.2 billion in financing approved by the Obama administration to help see the automaker through bankruptcy.

Like it or not, Chrysler is the automaker’s version of AMTRAK, a government supported subsidiary that the Obama administration hopes to unload on Fiat this summer. Next up is GM whose own restructuring is certain to make Chrysler’s arrangement look like child’s play.

Related Reading — Dodge Viper: End of the Road?