The New Chrysler-Fiat Group
Original article posted in MotorTrend.com
To prevent liquidation, Chrysler is anticipating a pending alliance with Fiat, which would relinquish ownership by 35 percent (with no money down), propelling the alliance to the sixth-largest automaker in the world, just behind Ford Motor Company.
Chrysler “revealed” that three models would be added to its scrapheap - the Dodge Durango and Chryslers Aspen and PT Cruiser.
The Fiat 500 likely will be added to the line-up as a showroom traffic-builder for Chrysler/Dodge/Jeep dealers. Additionally, Fiat and Alfa Romeo are planned for Chrysler’s North American plants.
Chrysler also plans to:
- Cut 13 shifts, total (up one from December 2)
- Cut 3000 additional jobs
- Seek an additional $2 billion in loan guarantees, totaling $9 billion
Like it or not, the Cadillac CTS coupe, 2011 Jeep Grand Cherokee, and Chrysler 300 have made their way into the reorganization plan of the U.S. Treasury.
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GM’s Bailout Strategy
Original article by Todd Lassa
GM presented its interim revitalization plan to Washington on February 17, revised downward from 12.5- to 13-million in the December 2 plan, forecasting break-even based on 11.5- to 12-million U.S. sales per year.
Hummer is done by next year if GM hasn’t signed a deal to sell it. Saab will be cut loose by January 1, 2010, and so the Swedish brand has filed for Chapter 11 bankruptcy. And unless its 400 dealers come forth with a plan for Saturn, that brand will join Oldsmobile in GM’s Graveyard of Divisions.
GM will cut its North American nameplate lineup from 48 down to 36 by 2012. Hummer (H2, H3), Saab (9-3, 9-5, 9-7x), and Saturn (Astra, Aura, Vue, Outlook, Sky) account for 10 of those 12 cuts. The Envoy makes 11, and the Pontiac G5 probably makes 12. The G6 sedan is likely dead, though the coupe and convertible versions do qualify as niche vehicles. The Buick Lucerne, Cadillac DTS, and STS all are likely to go away for a couple years until they’re replaced with a new full-size Buick and a converged DTS/STS.
GM also plans to:
- Reduce workforce by 47,000 globally, including 10,000 white collar (3,400 U.S. white collar)
- Close 14 North American factories by 2012, five more than in the December 2 plan
- Reduce U.S. dealers from 6,200 currently to 4,700 in 2012 and 4,100 in 2014
- Seek to convert bondholder debt and funding to autoworkers’ retirement health care funds into GM stock
- Seek up to $30 billion in federal loan guarantees, including funding already received, with repayment expected from 2012 to 2017
Saab is looking for funding, and plans to reemerge as an independent, Trollhättan-based automaker by the end of May. Saturn dealers were looking to find a buyer of their own, but the lesson we’ve learned in the last year is that we need less automotive capacity and fewer brands. Someone has got to go.
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