Wednesday, December 31, 2008

U.S. auto sales post sharp decline Chrysler numbers down 53% in Dec.

From staff and wire reports • January 6, 2009

photo

Unsold Compasses and Grand Cherokees sit at a Chrysler/Jeep dealership in the west Denver suburb of Golden, Colo., recently. Chrysler said Monday that its December U.S. sales plunged 53 percent. The company blamed the tough economy.

Chrysler LLC's December U.S. sales plunged by more than half, and it sold 30 percent fewer vehicles in 2008, dwarfing the steep declines at the other major automakers as consumers remained uncertain about the economy and their jobs.

Chrysler said Monday its December sales dropped 53 percent because of the recession and fewer fleet sales, while Toyota Motor Corp. reported a 37 percent slide and Honda Motor Co. said its sales tumbled 35 percent.

Ford Motor Co.'s U.S. sales fell 32 percent in December. General Motors Corp. and Nissan Motor Co. both posted 31 percent declines.

Ford's sales for 2008 fell 21 percent from a year earlier, keeping the Dearborn automaker in third place in the U.S. auto sales race, falling behind Toyota for the second straight year.

Toyota's 2008 sales fell 16 percent to 2.22 million, compared with Ford's 1.98 million. Detroit-based GM's 2008 sales totaled 2.95 million, down 23 percent from the year before. Honda's 2008 sales fell 8 percent.

The auto Web site Edmunds.com predicted sales for the full year will total just over 13 million, down 18 percent from 2007 and the lowest level since 1992. Final industrywide results were expected later Monday.

Noel Daniels of the Gray-Daniels chain of car dealerships in Mississippi said the first half of 2008 "was great for us."

"Thank God for the first six months, because the last six months were as challenging" as any Daniels said he can remember.

Gray-Daniels closed Yazoo Motor Co. in December and will focus its energy on its Jackson-area dealerships. Daniels said sales in the last two weeks of December at those dealerships were encouraging, as even customers with less-than-ideal credit were able to secure financing.

Daniels says he's optimistic 2009 will be better for the industry than 2008, adding credit should be more readily available.

Paul Moak, who sells a number of brands in metro Jackson, said his dealerships saw mixed results in 2008. There were slight drops in sales of his Volvo and GM vehicles as well as used cars, but sales of Subarus and Hondas held steady from 2007, he said.

"Every year is different. Each year has its own challenges," he said.

Moak and Daniels agree that a newly elected president and members of Congress could bring about at least some economic recovery. Moak added gas price fluctuations throughout the year will influence greatly the number of cars sold and what types of vehicles people will want to buy.

Despite lower gas prices in recent months, Daniels said demand for more fuel-efficient vehicles will remain strong and will be a major focus of automakers' production plans.

Ford said it sold 138,458 light vehicles in December, down from 204,787 in the same month in 2007. The automaker doesn't see much hope for improvement in early 2009, but predicted a small uptick later in the year.

"We expect the first few months of 2009 to feel much like last three months of 2008," Emily Kolinski Morris, Ford's senior economist, said during a conference call with reporters and industry analysts.

GM sold 220,030 light vehicles in December compared with 319,837 a year earlier. The recent month's results were boosted by heavy sales incentives, including financing offers announced near the end of the month after the Treasury Department said it would give $5 billion in federal aid to GM's ailing financing arm, GMAC LLC.

Subaru of America Inc. said its U.S. sales crept higher in 2008, making the Japanese company likely to be the only major automaker with a yearly sales increase. Subaru's U.S. sales rose by 0.3 percent to 187,699 vehicles from 187,208 in 2007, as consumers snapped up its top-selling Forester and Impreza.

Chrysler's December sales totaled 89,813 vehicles, compared with 191,423 in the year-ago month. Despite the plunge, the recent month's sales represented a 5 percent increase over November levels. the Auburn Hills, Mich., carmaker said the December drop included a 63 percent decrease in fleet sales.

Aaron Bragman, automotive marketing research analyst for IHS Global Insight in Troy, Mich., said large incentives such as zero-percent financing and rebates will continue well into 2009 as automakers try everything they can to boost sales.

Full-size truck incentives ran from $7,000 to $8,000 in December.

"You look in the paper and the deals on brand new GM pickups are astonishing," Bragman said. "The discount that you get buys a heck of a lot of gasoline."

Hyundai Motor America is trying to woo buyers by promising to let them return cars free for up to a year if they lose their jobs and can't make the payments.

The "Hyundai Assurance Program" applies to customers stricken by misfortune outside of their control, such as losing their job, becoming disabled or losing their driver's license for medical reasons. It covers depreciation up to $7,500.

Similar bold moves might be necessary throughout the year. Global Insight predicts U.S. sales will drop from 13 million in 2008 to 10.3 million this year as the economy continues to sputter.

While that may bring deals for consumers, it's bad news for automakers. GM and Chrysler were forced to go to the government for loans to hold off bankruptcy, and Ford says it may need government money if sales don't recover in 2009.

But Bragman said the sales drops are not unique to the U.S.-based automakers and encompass the entire domestic market.

Toyota said it sold 141,949 vehicles in December, down from 224,399 a year earlier. Sales of the Prius hybrid dropped 45 percent as gas prices fell from their record highs in July. Toyota is scheduled to unveil an updated Prius at the North American International Auto Show in Detroit next week.

Toyota has retooled a plant it is building in north Mississippi to manufacture the Prius. It initially announced it would produce the Highlander SUVs. The Blue Springs plant was slated to go online in 2010. Toyota announced last month it is postponing the opening indefinitely.

Jim Lentz, president of Toyota Motor Sales USA, said he was optimistic hybrid sales would rebound.

"We're going to see fuel prices creep up a bit," he said. "I think the overall greening of America is going to see an increase in hybrid (sales) as well."

Fewer Recalls at Ford, Chrysler Improve Industry Total in 2008


WardsAuto.com, Dec 31, 2008 10:58 AM

GM’s total recall campaigns and affected vehicles represent industry highs in 2008, while Toyota suffers one of the largest year-over-year recall increases.

Auto History - 31 Dec

12.31.1890 - Don E. Ahrens of General Motors is born in Lodgepole, NE
12.31.1923 - Philip Eglin Benton, Jr. of Royal Dutch/Shell Group is born in Charlottesville, VA
12.31.1932 - Jose Joseph Dedeurwaerder of American Motors and Renault is born in Halle, Belgium
12.31.1948 - The first redesigned “second series” 1949 Plymouth is produced
12.31.1951 - The Henry J Vagabond is introduced

Wednesday, December 24, 2008

How Much Rent Does Chrysler Pay Cerberus?

By Robert Farago

President Bush has pledged $4b of your taxes to Chrysler. Ultimately, the money will be under the control of the ailing American automaker’s owners, Cerberus Financial. Despite the enormous call on the public purse to fund a company whose prospects are dimmer than a 70’s porno theater, the secretive private equity group that pulls ChryCo’s strings has not opened the company’s books to full public scrutiny. Fortunately, we have a little something called the free press (and I don’t mean you Freep) ready to poke its nose into the dealings of the company about to poke its nose into the federal trough. The Wall Street Journal [sub] reports that “Public documents filed in Oakland County, Mich. show a Cerberus subsidiary called Auburn Hills Owner, LLC, bought the 458-acre complex on Aug. 3, 2007, for $325 million. That same day, Cerberus completed the deal to take over 80.1% of Chrysler from Daimler.” While the Journal seems obsessed with the fact that ChryCo employees didn’t know that Chrysler proper doesn’t own the Auburn Hills campus, the accounting behind the transaction is more interesting…

“While trying to sell Chrysler, Daimler put a higher value on the property. The sales binder that Daimler showed to potential buyers of Chrysler said the headquarters had a book value of $800 million and that Daimler had received an offer of $1.2 billion for the complex in August 2006, according to people who have seen the two-inch thick prospectus.

“The city of Auburn Hills assessed the property’s value at just over $460 million last year, down from a peak of approximately $620 million in 2005… On the day the acquisition of Chrysler closed, Cerberus secured a loan of $225 million against the headquarters building from Citigroup Global Markets Realty Corp., public documents show.

“A person familiar with the matter said Cerberus used that money to pay part of the $325 million it owned [sic] Daimler for the building.”

The bottom line: Cerberus owns the property and Chrysler pays rent to cover the nut. What’s the nut? What’s the rent? Unknown. As “investors” in Chrysler, taxpayers should demand to know every detail of their business. What other skeletons lurk in Cerberus’ closet?

Chrysler appealing assessed value

Company seeks a 48 percent reduction

By KEN de la BASTIDE
Tribune enterprise editor

Chrysler Corp. is seeking to reduce the amount of property taxes it will pay this year for the two transmission plants on the north side of Kokomo.

Chrysler officials have filed an appeal of the assessed value of the two plants, which opened in 1998 and 2003, with Howard County Assessor Jamie Shepherd.

The two plants currently have an assessed value for 2007 taxes payable in 2008 of $106,542,000 for the 283.64-acre site and the buildings.

The company wants the assessed value reduced to $55 million. Shepherd said the plants have never been assessed at $55 million.

Shepherd said Chrysler is not appealing the personal property (equipment) in the two facilities or at the Kokomo Casting Plant and the Kokomo Transmission Plant.

“In the past, the assessor and company officials would do a walk-through of the plants and agree on a price per square foot,” she said. “We couldn’t get a walk-through this year.”

Shepherd said the county was close to reaching an agreement with Chrysler in which it would drop the appeal and a walk-through would take place in 2009. She said the person negotiating for Chrysler no longer works for the company.

The county, using state guidelines, has set the assessed value at $49.62 per square foot and Chrysler wants the assessed value set at $25.

“The assessed value of the two plants increased by less than 2 percent,” Shepherd said of the 2007 pay 2008 rate.

The county has hired R&E Research to perform an analysis of the data provided by Chrysler and the county.

“We need to know why Chrysler believes it should be the lower assessment,” Shepherd said. “The data they are using is comparable to sales in several other states, including Michigan, Illinois, Ohio and Nevada.”

Shepherd said Indiana uses a market-value comparison based on use of the industrial space and several other states use market-value based on an exchange. She said the two Indiana transmission plants were built and designed for the automotive industry.

Once the analysis is completed there will be a township conference to discuss the evidence presented by Chrysler and R&E Research.

“I would like to reach an agreement,” Shepherd said. “Chrysler is a big component of our community, beyond the payment of taxes.”

Shepherd said during the appeal process, Chrysler will pay taxes on the two plants based on the 2006 pay 2007 assessment.

“Once I received notice of the appeal, I discussed it with all county officials,” she said. “It would be a big loss of our tax base.”

Shepherd said companies across Indiana are filing appeals on their industrial space and precedents could be set that impact appeals in other counties.

2009 Dodge Challenger R/T Manual - Short Take Road Test

Tuesday, December 23, 2008 Leave a Comment

The R/T model trumps its SRT8 big brother in our book.

The most breathless talk about the Dodge Challenger tends to center around the letters S, R, and T, and the number 8. The high-po–est form of Dodge's muscle car was the only choice offered for the initial 2008 run, and while still fun, it made do with a five-speed slushbox. Things have changed for 2009 with the addition of a 5.7-liter Hemi R/T model and a manual-transmission option for both V-8 cars. After testing an R/T model, we'd be happy to sacrifice the S and 8 from the badge, especially since the R/T comes with a price tag that's roughly 11 grand less.

I'm So Happy, I Could Shift

Big news for the Challenger is that it's the first (modern) Hemi-powered Chrysler car with an optional manual transmission. We're already fans of the tried-and-true Tremec TR-6060 six-speed gearbox, which is used in the Viper and many of GM's high performers. The Challenger's pistol-grip shifter is canted toward the driver, and allows for quick shifts via relatively short throws. Clutch-pedal travel, however, is longish, with an engagement point near the top of its movement. We were also annoyed by the 1–4 skip-shift that forces a two-gear upshift under light acceleration at low speed in the name of fuel economy. (Aftermarket kits are thankfully available to bypass this bothersome "feature," but no one's figured out yet how to relocate the foot-operated parking brake.)

Keep Reading: 2009 Dodge Challenger R/T Manual - Short Take Road Test

12.24.1889 - Henry Grady Weaver, a draftsman with the Haynes Automobile Company in Kokomo, IN 1913-1916, Assistant General Manager of the Sun Motor Car Company in Elkhart, IN 1916-1917, and longtime General Motors Director of Customer Research, is born in Eatonton, GA
12.24.1904 - The (Societa Anonima) Fabbrica Automobili Isotta-Fraschini assumes the assets of the original 1900 Isotta-Fraschini organization 12.24.1920 Automobile parts manufacturer Chester E. Clemens dies near Madison, OH at age 57 12.24.1930 - The unique Rolls-Royce Phantom 1 with custom “windblown” coupe body by Brewster is completed and delivered to owner Tommy Manville
12.24.1949 - Racer Warwick Brown is born in Sydney, NSW, Australia

Chrysler LLC's Street and Racing Technology (SRT) Selects Alcoa's Dura-Bright(R) Technology for Dodge Viper and Jeep(R) Grand Cherokee

Tue Oct 21, 11:52 AM
      Alcoa Automotive Wheels, a division of Alcoa Wheel and Transportation        Products, announced today that it has been awarded platform placement of        Dura-Bright® technology wheels with Chrysler        LLC’s Street and Racing Technology (SRT)        engineering organization.
Enlarge Photo

(Business Wire)

CLEVELAND--(BUSINESS WIRE)--Alcoa Automotive Wheels, a division of Alcoa Wheel and Transportation Products, announced today that it has been awarded platform placement of Dura-Bright® technology wheels with Chrysler LLC’s Street and Racing Technology (SRT) engineering organization. Two new wheels within the Chrysler SRT family, including both Dodge and Jeep® platforms, will begin placement with the 2009 model year.

“Our innovative Dura-Bright® technology has enjoyed commercial success for many years in the heavy duty truck market and more recently with leading Global automobile manufacturers. We are honored that Chrysler’s SRT organization has recognized that this wheel surface innovation can add value and product differentiation through easy to clean maintenance benefits extended to their new vehicle owners,” said Kevin Kramer, President, Alcoa Wheel and Transportation Products.

Chrysler’s SRT organization has selected the patented surface treatment for the standard 5-spoke wheel fitted to the Dodge Viper SRT10 coupe and roadster. Alcoa forged wheels treated with Dura-Bright® technology allow Viper owners to maintain their sports cars appearance with minimal maintenance effort. Vehicles fitted with aggressive brake packages, like the Dodge Viper SRT10, typically generate a high level of brake dust. Viper owners will now be able to maintain the appearance of their vehicle with less effort to keep their wheels cleaner with Dura-Bright® technology.

Chrysler’s SRT organization has also selected Dura-Bright® technology for fitment on Jeep Grand Cherokee SRT8. Owners will appreciate the exclusive wheel surface treatment to easily clean away brake dust, dirt and road grime whether they use the vehicle for on-road or off-road performance.

Alcoa began supplying one-piece forged aluminum SRT wheels on the Dodge Viper SRT10 in 2002. The company has supplied wheels for all SRT8 fitments, including Chrysler 300C, Dodge Challenger, Dodge Charger, Dodge Magnum and Jeep Grand Cherokee since 2004. 2009 will signal the first applications of Dura-Bright® technology to the Chrysler SRT organization. Look for “db” engraved on Dodge Viper SRT10 and Jeep Grand Cherokee SRT8 wheels, to identify them as being specially treated with Alcoa’s patented Dura-Bright® technology.

Along with the benefits of easy to clean Dura-Bright® technology, all SRT wheels by Alcoa are forged from one piece of aerospace grade 6061-T6 aluminum. The forging process aligns the grain of the metal producing a strong and durable wheel with light weight benefits to enhance vehicle performance and fuel economy. Forged aluminum wheels by Alcoa are typically twice as strong while reducing weight by over 20 percent as a comparable cast aluminum wheel.

All aluminum wheels for Chrysler’s SRT organization are forged at Alcoa’s Cleveland (Ohio) Works Plant. For more information, visit www.strongwheels.com.

Tuesday, December 23, 2008

12.23.1904 - Hon. C. S. Rolls contracts with Royce, Ltd. to take all automobiles of 2-cylinders/10 hp through 6-cylinders/30 hp manufactured by the latter company
12.23.1922 - Salmson #001, rebodied after a racing accident, is sold in England
12.23.1939 - Edmund Coleman Craft of the Borg-Warner Corporation is born in Plainfield, NJ
12.23.1956 - Racer Michele Alboreto is born in Milan, Italy
12.23.1971 - Alessandro Cagno, winner of the first Targa Florio, dies at age 88

Dec. 22 letter from Bob Nardelli to Chrysler employees

Dear Employees,

As this eventful year draws to a close, I'd just like to take a moment and once again express my personal appreciation and thank you for your commitment and dedication to Chrysler LLC. Reflecting back on the year, I'm sure we can all agree that this one stands out for the extraordinary challenges we faced, as well as for the many accomplishments we can look back on.

We are grateful to the U.S taxpayers and the U.S. Treasury Department that they will provide a loan to Chrysler to help bridge the current financial crisis. And we appreciate that the Government of Canada and the Government of Ontario have offered to provide financial assistance as well to protect Canadian manufacturing. This support underscores their confidence in Chrysler's plan for future viability and their recognition of the importance of the automotive industry to North America.

Despite the difficult economic conditions and financial crisis we faced this year, we continued to make significant progress in improving the fundamentals of our business, while strengthening our focus on customer first and quality period.

We continued to invest in and deliver great new products, launching the crossover Dodge Journey, the exciting Dodge Challenger and Challenger SRT8, the Liberty re-launch and the all-new Dodge Ram, which has received glowing accolades from the media, including a nomination for North American Truck of the Year. We also celebrated the 25th anniversary of our invention of the minivan, which still wears the crown as the world's best-seller.

Chrysler's ongoing commitment to safety is evident in government ratings.

For the 2009 model year, more than 88 percent of Chrysler vehicles achieved NHTSA's highest possible rating - five stars for frontal crash tests.

Eighty-six percent of Chrysler vehicles achieved the Government's highest rating for side-impact protection.

We continue to boost the fuel economy of our vehicles. For the 2009 model year, 73 percent of our products offer improved mileage compared with 2008 models, with six vehicles offering 27 mpg or better highway fuel economy:

the Caliber, Patriot, Compass, Sebring, Sebring Convertible and Avenger.

And in September, we shocked the industry with the unveiling of our ENVI family of all-electric and range-extended electric vehicles, a major step on the path to national energy security and reduced environmental impact.

We will put our first electric-drive vehicle into production for North America by 2010 with three additional models by 2013.

Our long-range product plan is robust, realistic and green. The plan features 24 major launches from 2009 through 2012. Many of you had the opportunity last week to attend the future products open house in the Design Dome and saw the all-new versions of key models such as the Chrysler 300, Dodge Durango, Dodge Charger, Jeep Grand Cherokee, our electric vehicle prototypes and the sketches of other products like a new fuel-efficient small car. You also had a chance to see the tremendous strides we are making in the quality of our interiors, which will have a major impact on pleasing our customers, as well as the latest generation of our uconnect family of consumer technologies for in-vehicle information, communications and entertainment. Our future plans also include a hybrid Ram truck.

We made steady progress in productivity and quality this year. According to the Harbour Report, we have increased our manufacturing productivity by 32 percent over the past seven years and now equal Toyota as the most productive automaker in North America as measured by hours of assembly per vehicle. Due to a focused product quality improvement effort during the past year, we've seen our warranty claim rates drop by 29 percent and the improvement trend continues.

Since the economic downturn began in 2007, we have faced this harsh reality and consistently acted quickly to reduce operating costs, adjust production schedules and prioritize product investment to mitigate the effects of this historic recession and financial crisis. We've taken out 1.2 million units of capacity, eliminated 12 production shifts and closed two manufacturing plants. We've reduced our fixed costs by $2.4 billion. The difficult restructuring, combined with the recent retirements and voluntary terminations, has reduced Chrysler employment by 32,000 since 2007. We've all said good-bye to many colleagues and friends who have served Chrysler so well over the years.

However, these and other difficult but necessary actions have positioned Chrysler to begin 2009 as a leaner, more efficient and focused organization characterized by fewer layers of management with broader spans of control.

We have a realistic and achievable plan to turn Chrysler around and return the company to profitability. With the government bridge loan forthcoming, we'll have the financial backing to implement that plan. In the weeks ahead we will continue to work with all of our stakeholders to achieve the shared sacrifice that we need in order to achieve long-term viability.

Throughout the government loan request process, I've received many letters, calls and e-mails of support from our extended Chrysler family, our customers and many Americans who support the automotive industry. To show our appreciation, we will be placing an advertisement in several national newspapers today, thanking America for investing in Chrysler. A link to a copy of the advertisement is attached.

In closing, I wish you and your loved ones the happiest of holiday seasons.

Enjoy your family time together, wherever your travels may take you. I look forward to rejoining you in January to take on 2009 with a resolve to return our business to profitability and viability.

God Bless you all. Best wishes and warmest regards,

Bob

Jim Press says Chrysler could be America's Benz, BMW



What American automaker best matches up with the uber-machines from the Germans? Lincoln... no, probably not. Cadillac? Getting warmer. How 'bout Chrysler, asks ChryCo. co-Prez Jim Press. After a quick review of Chrysler's current line-up, we're not really buying the comparison; but it's fun to dream, so we'll bite. The Sebring is roughly the size of the C-Class and 3 Series, but it's driving the wrong wheels to go head-to-head with BMW and Mercedes-Benz, so that would need a complete rework, to say the least.

The 300C is a very nice car with an appropriate engine up front, rear-wheel drive and a relatively attractive price compared to the Germans. That could work, but it's clear that Chrysler would need to pump lots more money into the car to keep it up to date with it's competition from Germany. Minivans don't equate very well to any Germanic rivals, especially since the R-Class from MB has been a major disappointment.

One possible area that Chrysler has over its supposed competition is trucks. The new '09 Ram may be a major step up from its predecessor, but we're not so sure we're ready to call it the Mercedes-Benz of pickups, which is pretty much how Press says he sees it. We're all for the idea of an American competitor for Mercedes and BMW, and we'd love to see the Pentastar emerge from its financial problems a leaner, more focused manufacturer. Still, we wonder if Chrysler should set its sights on cross-town rival Cadillac before jumping all the way to Germany.

Monday, December 22, 2008

http://www.thescoop-cg.com/wp-content/uploads/us-senate-viablity-plan.pdf

Message from Bob Nardelli

calendar (1K) Posted Monday, Dec 22, 2008 at 4:32 pm in Messages From Our Leaders

Dear Employees,

As this eventful year draws to a close, I’d just like to take a moment and once again express my personal appreciation and thank you for your commitment and dedication to Chrysler LLC. Reflecting back on the year, I’m sure we can all agree that this one stands out for the extraordinary challenges we faced, as well as for the many accomplishments we can look back on.

We are grateful to the U.S taxpayers and the U.S. Treasury Department that they will provide a loan to Chrysler to help bridge the current financial crisis. And we appreciate that the Government of Canada and the Government of Ontario have offered to provide financial assistance as well to protect Canadian manufacturing. This support underscores their confidence in Chrysler’s plan for future viability and their recognition of the importance of the automotive industry to North America.

Despite the difficult economic conditions and financial crisis we faced this year, we continued to make significant progress in improving the fundamentals of our business, while strengthening our focus on customer first and quality period.

We continued to invest in and deliver great new products, launching the crossover Dodge Journey, the exciting Dodge Challenger and Challenger SRT8, the Liberty re-launch and the all-new Dodge Ram, which has received glowing accolades from the media, including a nomination for North American Truck of the Year. We also celebrated the 25th anniversary of our invention of the minivan, which still wears the crown as the world’s best-seller.

Chrysler’s ongoing commitment to safety is evident in government ratings. For the 2009 model year, more than 88 percent of Chrysler vehicles achieved NHTSA’s highest possible rating - five stars for frontal crash tests. Eighty-six percent of Chrysler vehicles achieved the Government’s highest rating for side-impact protection.

We continue to boost the fuel economy of our vehicles. For the 2009 model year, 73 percent of our products offer improved mileage compared with 2008 models, with six vehicles offering 27 mpg or better highway fuel economy: the Caliber, Patriot, Compass, Sebring, Sebring Convertible and Avenger. And in September, we shocked the industry with the unveiling of our ENVI family of all-electric and range-extended electric vehicles, a major step on the path to national energy security and reduced environmental impact. We will put our first electric-drive vehicle into production for North America by 2010 with three additional models by 2013.

Our long-range product plan is robust, realistic and green. The plan features 24 major launches from 2009 through 2012. Many of you had the opportunity last week to attend the future products open house in the Design Dome and saw the all-new versions of key models such as the Chrysler 300, Dodge Durango, Dodge Charger, Jeep Grand Cherokee, our electric vehicle prototypes and the sketches of other products like a new fuel-efficient small car. You also had a chance to see the tremendous strides we are making in the quality of our interiors, which will have a major impact on pleasing our customers, as well as the latest generation of our uconnect family of consumer technologies for in-vehicle information, communications and entertainment. Our future plans also include a hybrid Ram truck.

We made steady progress in productivity and quality this year. According to the Harbour Report, we have increased our manufacturing productivity by 32 percent over the past seven years and now equal Toyota as the most productive automaker in North America as measured by hours of assembly per vehicle. Due to a focused product quality improvement effort during the past year, we’ve seen our warranty claim rates drop by 29 percent and the improvement trend continues.

Since the economic downturn began in 2007, we have faced this harsh reality and consistently acted quickly to reduce operating costs, adjust production schedules and prioritize product investment to mitigate the effects of this historic recession and financial crisis. We’ve taken out 1.2 million units of capacity, eliminated 12 production shifts and closed two manufacturing plants. We’ve reduced our fixed costs by $2.4 billion. The difficult restructuring, combined with the recent retirements and voluntary terminations, has reduced Chrysler employment by 32,000 since 2007. We’ve all said good-bye to many colleagues and friends who have served Chrysler so well over the years.

However, these and other difficult but necessary actions have positioned Chrysler to begin 2009 as a leaner, more efficient and focused organization characterized by fewer layers of management with broader spans of control. We have a realistic and achievable plan to turn Chrysler around and return the company to profitability. With the government bridge loan forthcoming, we’ll have the financial backing to implement that plan. In the weeks ahead we will continue to work with all of our stakeholders to achieve the shared sacrifice that we need in order to achieve long-term viability.

Throughout the government loan request process, I’ve received many letters, calls and e-mails of support from our extended Chrysler family, our customers and many Americans who support the automotive industry. To show our appreciation, we will be placing an advertisement in several national newspapers today, thanking America for investing in Chrysler. A link to a copy of the advertisement is attached.

In closing, I wish you and your loved ones the happiest of holiday seasons. Enjoy your family time together, wherever your travels may take you. I look forward to rejoining you in January to take on 2009 with a resolve to return our business to profitability and viability.

God Bless you all. Best wishes and warmest regards,

Thursday, December 18, 2008

This Day in Auto History:

12.22.1896
Fahrzeug-Fabrik Eisenach, an ancestor of BMW, is organized
12.22.1920
Genevieve Marguerite Delcuze, the second wife of Ettore Bugatti, is born in Courbevoie, France
12.22.1931
Noel Goutard, Chairman of the French automobile parts manufacturer Valeo SA, is born in Casablanca, Morocco
12.22.1952
Johan Jan Beeckmans of ITT Automotive Inc. is born in Antwerp, Belgium
12.22.1962
Francis B. Davis, Chairman of the United States Rubber Company 1929-1949, dies in Wilmington, DE at age 79

Chrysler Financial May Curb Loans as Dealers Tap Cash (Update2)

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By Greg Bensinger and Mike Ramsey

Dec. 17 (Bloomberg) -- Chrysler LLC’s credit arm said it may temporarily halt the loans used by dealers to buy vehicles as the retailers pull money from an account that helps finance their borrowing.

Losing access to the lending, known as floorplan, from Chrysler Financial would be a blow to dealers struggling with a 28 percent plunge in 2008 U.S. sales. Dealers put money into the account to pay off loans early. They get a 2 percent bonus if the cash stays in the fund for a set period of time, while still being able to pull it out and make scheduled repayments instead.

Almost $60 million a day is flowing from the account, a rate “that is troubling,” Chrysler Financial Chief Executive Officer Thomas Gilman wrote to dealers on Dec. 12. More withdrawals may “force us to suspend wholesale financing.”

“All the dealers got scared when Chrysler started talking about bankruptcy in front of Congress, and they pulled their money out,” said Dick Mullen, a Chrysler dealer in Southold, New York. “If a dealer can’t get floorplan from Chrysler there’s almost nowhere else to turn. It’ll be a disaster.”

Withdrawals from the fund have totaled more than $1.5 billion since July, Gilman wrote. That adds to the cash squeeze at Chrysler and Chrysler Financial, which are both owned by New York-based buyout firm Cerberus Capital Management LP.

“Chrysler Financial finances 75 percent of all vehicles shipped to U.S. dealers and will continue to support our dealer body with uninterrupted wholesale financing,” Amber Gowen, a company spokeswoman, said today.

Pressure on Chrysler

Chrysler is being pressed by a small number of suppliers for payment in advance as it seeks federal assistance to avoid running out of cash as soon as year’s end, people familiar with the matter said last week. Auburn Hills, Michigan-based Chrysler has said it needs $4 billion to operate to March 31.

Gilman said Chrysler Financial has been in talks for more than a month with the U.S. Treasury Department and the office overseeing the Troubled Asset Relief Program to help “break the logjam” in the market for so-called asset-backed securities such as car loans.

That may help Chrysler Financial “in the form of liquidity to fund wholesale and retail loans,” Gilman wrote.

Auto lenders raise capital by issuing securities backed by car loans, enabling them to offer more credit.

Separately, Chrysler said yesterday it joined a financing program with about 2,500 credit unions to offer low-cost auto loans to buyers in 12 states. Under the program, consumers are eligible for rebates of as much as $1,000.

The credit unions have said they have pledged as much as $12 billion to the program, which runs to June 30. U.S. industrywide auto sales fell 16 percent through November.

Ontario leader says more auto bailouts to come

Associated Press, 12.17.08, 12:44 PM EST

pic

Canada's potential $2.8 billion rescue package for the U.S.-based automakers is just the first of what could be several payments, Ontario Premier Dalton McGuinty says.

McGuinty said Wednesday the 3.4 billion Canadian dollars promised jointly by Ottawa and Ontario to the Detroit Three is simply a lifeline to sustain the industry. General Motors Corp. (nyse: GM - news - people ), Chrysler LLC and Ford Motor Co. (nyse: F - news - people ) all have large operations in Ontario.

McGuinty warns it's too early to speculate on how high the aid could go because the province is still assessing documents and plans.

His comments come one day after Economic Development Minister Michael Bryant called the possible loss of the auto industry in Ontario a "doomsday scenario" that cannot come to pass. Canada could lose more than 580,000 jobs within five years if Detroit's Three automakers go out of business, according to a Ontario government commissioned report.

Last week, Ottawa and Ontario announced they would provide the equivalent of 20 percent of whatever emergency aid Washington provides - a figure proportional to the number of vehicles produced in Canada.

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Bush administration officials were still evaluating options and attempting to avoid a disorderly bankruptcy of the companies. Congress failed a week ago to reach consensus on a $14 billion aid package for struggling GM and Chrysler.

But the Canadian aid for the automakers won't come until the U.S. makes its plans known.

Governments in Canada have helped the U.S automakers before. Ottawa and Ford Motor Co. announced in September that a new research center for environmentally friendly technologies will be launched in a government partnership that includes up to 80 million Canadian dollars ($66 million) in government funding.

Ontario has helped the auto sector with a 500 million Canadian dollar ($413 million) fund that was designed to attract and keep jobs in the province.

Canada is attractive to the U.S. automakers because the government provides universal health care to all Canadians, unlike in the U.S. where the automakers subsidize workers' health care tabs.

This Day in Auto History:

12.18.1898
Theodor Parsons Hall, develop of the Hall flying automobile, is born in Wallingford, CT
12.18.1919
Racer Henri Fournier dies in Paris, France at age 48
12.18.1941
Racer Wayne Baker is born
12.18.1955
Racer Ted Musgrave is born in Franklin, WI
12.18.1991
Racer George Abecassis dies in Ibstone, Buckinghamshire, England at age 78

2008 Dodge Challenger SRT8 HHP/BES 426 1/4 mile Drag Racing timeslip specs 0-60

1/4 Mile ET: 11.791
1/4 Mile MPH: 117.380
1/8 Mile ET: 7.570
1/8 Mile MPH: 92.300
0-60 Foot ET: 1.709
Temperature F: 0.0
Density Altitude (DA): DA Calculator
Timeslip Scan: Dodge Challenger SRT8 Timeslip Scan
Car Make: Dodge
Car Model: Challenger SRT8
Car Type: HHP/BES 426
Car Year: 2008
Driver: Trojan
E-Mail: Private
Videos: Challenger-SRT8 Videos
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2008 Dodge Challenger SRT8 HHP/BES 426

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Chrysler shutdown to idle 46,000 for month

A signal of dire future if no auto aid comes?

BY JUSTIN HYDE and KATIE MERX • FREE PRESS BUSINESS WRITERS • December 18, 2008

Chrysler LLC announced Wednesday it would shutter all 30 of its factories for one month and idle 46,000 workers, while General Motors Corp. said it was delaying a key supply plant for the Chevrolet Volt, as both attempted to avoid imminent collapse while the Bush administration pondered a rescue.

Chrysler's move signals the first of a cascade of dire actions that will result if the automakers don't receive government aid, a person close to the situation said. Following a 47% decline in sales last month, some Chrysler plants are to be closed until February.

The Wall Street Journal reported late Wednesday that merger talks involving GM and Chrysler had resumed. The talks were suspended in late October when the Bush administration expressed reluctance to provide money for a merger that could result in thousands of jobs lost.

But the Journal said Chrysler's majority owner, Cerberus Capital Management, under pressure from some members of Congress to put more money into Chrysler, restarted the talks and indicated willingness to surrender part of its stake in the company.

Chrysler and GM have said they need at least $8 billion by the end of the month to avoid bankruptcy and at least $14 billion to get through the first quarter.

"It's clear that the automakers are in a very fragile financial condition, and they're taking steps to deal with it," said White House spokeswoman Dana Perino. "We're aware of their financial situation and are considering possible policy options to provide assistance in an appropriate way. As we've said, a disorderly collapse of the auto industry should be avoided."

While President George W. Bush and other officials have promised to act since the Senate blocked a rescue last Thursday, auto dealers and other industry supporters say the wait is damaging the rest of the economy.

"Manufacturing makes up the backbone of this economy, and that backbone is being broken," said Sen. Debbie Stabenow, D-Mich. "This administration must act now to preserve the middle class and protect our economy."

"Time is of the essence," said Annette Sykora, chairwoman of the National Automobile Dealers Association. "A lot of people are depending on the White House to provide the bridge loans to prevent a collapse of the auto industry. We need action now."

Chrysler said Wednesday that it would double a planned shutdown of all 30 North American plants from nearly two weeks to one month -- starting Friday through Jan. 19 -- citing sluggish sales. Chrysler said a lack of consumer credit had kept even willing buyers from closing on sales over the past couple of months.

"The dealers have stated that they have lost an estimated 20% to 25% of their volume because of this credit situation," the company said in a statement.

Chrysler spokeswoman Shawn Morgan said the Windsor minivan plant and Detroit's Conner Avenue sports car assembly plants are to be closed for the entire month of January. Both Toledo Jeep plants are to be closed until Jan. 26.

Chrysler's plants typically are shut down from Christmas Eve through New Year's Day. This year, they already were scheduled to be idled from Dec. 22 through Jan. 2.

Workers are to be considered laid off for the additional two to four weeks their plants are shut down.

"It comes as no surprise to me," said Eddie Gordish, a skilled trades worker at Jefferson North Assembly in Detroit. "All of a sudden, everything seems so crazy, so dire."

Meanwhile, GM said it was temporarily halting work on a new engine plant in Flint that is slated to build four-cylinder engines for the Chevrolet Volt electric vehicle and Chevrolet Cruze compact car. GM said the move did not change the deadline for building the Volt in late 2010, and would save money on construction materials in the near-term.

"It's temporarily on hold as we assess our cash situation," said GM spokeswoman Sharon Basel. "I don't think it's a surprise that we're studying and reviewing everything given the position we're in."

Ford Motor Co., which isn't seeking immediate federal aid, also said Wednesday that it would add an extra week to its two-week holiday shutdown at 10 North American plants, with the exception of two plants, which build the F-150 pickup.

GM announced plans to build the $349-million engine plant in Flint in September and told Congress it was spending $758 million on developing the Volt and its engine technology through 2012.

Both the Volt and the Cruze, a sedan expected to get 40 miles per gallon, have been touted by GM as examples of its commitment to more fuel-efficient models. The delay by GM follows word from Toyota Motor Co. on Monday that it was halting work on a Mississippi factory that would have built a new version of the Toyota Prius hybrid.

"These delays due to a cash crunch make it clear that without federal investment, the green revolution could come to a screeching halt," said U.S. Rep. John Dingell, D-Mich. "The sooner we get this bridge loan to Detroit, the better chance we have of getting more green cars into showrooms quickly."

Wednesday, December 17, 2008

(Possible) China Buyout Watch: Chrysler And Great Wall

By Bertel Schmitt
December 17, 2008 -

Two weeks ago, Chrysler terminated its joint venture talks with Chery. This doesn’t stop Chrysler from talking to the Chinese. The talks go in two directions: One, Chrysler needs low cost cars, and the Chinese have them. Two, Chrysler is looking for a buyer, and a Chinese company may just have mercy and cash and take Chrysler off the sweaty hands of Cerberus. Hell, you never know. Now, Chrysler has been spotted chatting up Great Wall Motors, Gasgoo reports. Great Wall is known for its large portfolio of SUVs and MPVs. They also got into hot legal waters with Fiat who claimed that Great Wall’s Peri (called Jing Ling in China) is a copy of Fiat’s Panda. A court in Turin said Fiat is right and Great Wall is wrong. A copyright claim in China is slowly grinding through the wheels of the Chinese courts.

According to Gasgoo, Philip Murtaugh, Chrysler Asia CEO, went to inspect Great Wall Motor’s facility last week to look into the code-named CH041 model and CH031 hatchback, which could be the A-class model Chrysler needs. Murtaugh was supposedly satisfied with the two models. Great Wall Motor said the two parties will launch “CH031″ first if the projects fare well. The two automakers are still in talks and nothing is definite yet, said Great Wall Motor. If the models see the light of mass production, they will go on sale in overseas markets with the Chrysler label. A Chrysler China executive said Chrysler was in - duh - “a transitional period.” They might need Great Wall, one way or the other.

Chrysler latest Trademarks

Serial Number Reg. Number Word Mark Check Status Live/Dead
1 78976488 3030758 U C O N N E C T TARR LIVE
2 78976487 3024822 UCONNECT TARR LIVE
3 78975421 2857019 WHERE ADRENALINE AND TECHNOLOGY MEET TARR LIVE
4 78972570
EXTRA CREDIT TARR LIVE
5 78971401
COMPLETERENTAL TARR LIVE
6 78951523
STARPARTS LITE TARR LIVE
7 78938650
SNAKESKIN TARR LIVE
8 78938042
TRAILHAWK TARR LIVE
9 78920255
ROLLOVER MILES TARR LIVE
10 78920215
DODGE CREW TARR LIVE
11 78918584
DISCIPLINED PIZZAZZ TARR DEAD
12 78907664
GREAT RIVER ROAD TARR DEAD
13 78907244 3354295 MYGIG TARR LIVE
14 78907048
LATITUDE TARR LIVE
15 78907019
LIBERTY LATITUDE TARR LIVE
16 78877458 3420519 NASSAU TARR LIVE
17 78866661
TOMAHAWK TARR LIVE

Chrysler LLC Latest Patents

1 D581,326 Full-Text Vehicle hood
2 D580,312 Full-Text Vehicle grille
3 7,448,357 Full-Text Air induction system and assembly method for an intake manifold with a single shaft and sensor for activating air control valves
4 D579,839 Full-Text Vehicle side mirror
5 D579,832 Full-Text Vehicle hood
6 7,445,751 Full-Text Creep resistant magnesium alloy
7 7,445,237 Full-Text Air bag vent
8 7,445,236 Full-Text Venting canister for airbag system
9 7,444,845 Full-Text Retainer for a door lock
10 7,440,833 Full-Text Clutch fill volume learning strategy for transmission control
11 D578,436 Full-Text Automobile body
12 7,434,646 Full-Text On-demand four wheel drive system
13 D577,841 Full-Text Vehicle headlamp
14 7,429,058 Full-Text Passenger airbag door
15 7,426,701 Full-Text Interactive drill down tool
16 7,424,925 Full-Text Hybrid vehicle with integral generator for auxiliary loads
17 D576,529 Full-Text Vehicle rear bumper
18 D576,524 Full-Text Automobile body
19 7,424,344 Full-Text HVAC control using modulated evaporator outlet temperature
20 7,422,130 Full-Text Retractable cross rail for vehicle roof rack
21 D576,090 Full-Text Vehicle front fender
22 7,421,325 Full-Text Automatic transmission calibration method
23 7,418,950 Full-Text Fuel pump and tank assembly for an automotive vehicle
24 D575,701 Full-Text Vehicle hood
25 D575,697 Full-Text Vehicle rear bumper
26 D575,696 Full-Text Vehicle front bumper
27 D575,695 Full-Text Vehicle rear bumper
28 D575,694 Full-Text Vehicle front bumper
29 7,416,510 Full-Text Control of a vehicle powertrain with multiple prime movers
30 7,416,247 Full-Text Retractable vehicle roof system
31 7,416,242 Full-Text Reinforcement plate
32 7,416,235 Full-Text Dual sliding center console
33 7,416,211 Full-Text Safety system for an automobile
34 7,415,954 Full-Text Rocker shaft arrangement for an engine
35 7,415,903 Full-Text Method and system for an impact sled footwell intrusion test
36 7,415,872 Full-Text Method and code for determining characteristic of road surface beneath moving vehicle
37 7,413,259 Full-Text Hub and extension arrangement for an axle having dual wheels
38 7,413,231 Full-Text Truck cargo bed management system
39 7,413,229 Full-Text Holder for an electronic device
40 7,413,211 Full-Text Deactivation arrangement for a vehicle park assist system
41 D574,298 Full-Text Automobile body
42 7,406,845 Full-Text Steering column lock assembly and method of operating the same
43 D573,507 Full-Text Automobile body
44 D572,640 Full-Text Vehicle hood
45 D572,638 Full-Text Vehicle front bumper
46 D572,392 Full-Text Vehicle headlamp
47 D572,183 Full-Text Vehicle front fender
48 D572,179 Full-Text Vehicle grille
49 7,393,043 Full-Text Method and system for determining full open position of a power liftgate
50 7,393,036 Full-Text Slide out cargo floor