Fiat Chrysler Automobiles: Sales, Marketing, and Financial News
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Chrysler may match GM discounts if extended
Chrysler may match GM discounts if extended - - Reuters / June 29, 2005 - - Source: Automotive News
DETROIT -- Chrysler may match General Motors' offer giving all U.S. car buyers the same discounts its employees get if GM extends the promotion beyond next week, a newspaper said on Wednesday.
Citing sources familiar with the matter, the Detroit News said the U.S. arm of DaimlerChrysler had told its national dealer council on Tuesday it could make a similar offer as early as next Monday if GM extends its promotion through July.
GM, the world's largest automaker, has seen customer traffic soar since it announced the offer on June 1. The offer is due to end on July 5 but GM's North American marketing chief has been quoted as saying it might be prolonged.
Chrysler spokesman Jason Vines confirmed that the GM consumer incentives program was discussed with the dealer council, but he said the automaker would not necessarily follow in GM's footsteps.
"We're looking at every option," Vines told Reuters.
"We could announce a new (incentives) campaign as early as Friday or as late as Monday or Tuesday," he added. "What we don't want to do is match the fire sale mentality."
The success of the GM offer -- expected to be confirmed by June U.S. sales numbers on Friday -- is forcing rivals to take a look at how to defend share in the world's biggest and most fiercely competitive car market.
Dan Bedore, a spokesman at GM's crosstown rival Ford Motor Co., said "that's not in the works right now" when asked if the No. 2 U.S. automaker was considering matching the employee discount program.
"We are going to watch the market," he said.
Citing sources familiar with the matter, the Detroit News said the U.S. arm of DaimlerChrysler had told its national dealer council on Tuesday it could make a similar offer as early as next Monday if GM extends its promotion through July.
GM, the world's largest automaker, has seen customer traffic soar since it announced the offer on June 1. The offer is due to end on July 5 but GM's North American marketing chief has been quoted as saying it might be prolonged.
Chrysler spokesman Jason Vines confirmed that the GM consumer incentives program was discussed with the dealer council, but he said the automaker would not necessarily follow in GM's footsteps.
"We're looking at every option," Vines told Reuters.
"We could announce a new (incentives) campaign as early as Friday or as late as Monday or Tuesday," he added. "What we don't want to do is match the fire sale mentality."
The success of the GM offer -- expected to be confirmed by June U.S. sales numbers on Friday -- is forcing rivals to take a look at how to defend share in the world's biggest and most fiercely competitive car market.
Dan Bedore, a spokesman at GM's crosstown rival Ford Motor Co., said "that's not in the works right now" when asked if the No. 2 U.S. automaker was considering matching the employee discount program.
"We are going to watch the market," he said.
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Originally Posted by gavriil
Assuming this will be good on the SRT8 models, there goes the Mustang GTs crown on performance over price. You'll be able to get a 425HP monster for $25K 
Ooh...an SRT-4 at employee prices might make for a fun daily driver...
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From: Massachusetts
If it's anything like DCX's Affiliate Rewards Program, which I get through my company, then the excluded vehicles are: all SRT models, Dodge Sprinter, Dodge Viper, Dodge Magnum R/T, Chrysler 300C, and all Mercedes-Benz vehicles.
'Big Daddy Diggler'
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From: Yonkers NY
Originally Posted by gavriil
Assuming this will be good on the SRT8 models, there goes the Mustang GTs crown on performance over price. You'll be able to get a 425HP monster for $25K
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GM is threatening Chrysler to "take it back" **Vehicle Value Retention Issue**
Chrysler's recent TV commercial claims causing a stir at GM - - By JAMIE LAREAU | Automotive News and MARY CONNELLY | Automotive News - - Source: Autoweek
DETROIT -- In a terse exchange, General Motors is challenging the Chrysler group to "take it back." And Chrysler isn't budging.
In Chrysler's recent TV commercials featuring former Chrysler Corp. Chairman Lee Iacocca, the automaker says Chrysler vehicles retain their value better than GM or Ford vehicles.
GM says that's not true if measured on a nameplate-by-nameplate basis. GM wants the Chrysler group to change the spots and is threatening to take action if it doesn't.
"We strongly disagree with the claims made in the current Chrysler advertising regarding the projected retained value of its vehicles compared to GM," says GM spokesman Jeff Kuhlman. "We are exploring various courses of action and have expressed our concerns to Chrysler."
GM sent a letter to Chrysler protesting the claim in the Iacocca commercials that Chrysler group vehicles "are projected to retain their values better than GM or Ford."
Chrysler is refusing to change the commercials, says Mike Aberlich, a Chrysler group spokesman.
"We respectfully disagree and we have responded to them," Aberlich says.
'Lawyer to lawyer'
Chrysler received GM's letter on Wednesday, July 20. Chrysler responded Thursday, July 21, Aberlich says.
Asked who signed the letters, Aberlich said the missives were "lawyer to lawyer" communications.
In its letter, GM asked Chrysler to withdraw its claim, Aberlich says.
A source close to the situation says GM will see whether Chrysler will bow to the pressure and retract its claim before pursuing further action. The source, who would not elaborate on what that action might be, says Chrysler has manipulated the data.
Chrysler, however, is sticking to its guns.
"The claim that we made was a Chrysler group weighted corporate average, and we stick by it," Aberlich says.
GM cited a nameplate-by-nameplate comparison in its letter to Chrysler, a Chrysler source says. Neither GM nor the source would not identify the vehicles cited.
According to year-to-date data from Automotive Lease Guide, a Santa Barbara, Calif., company that estimates residuals that are widely accepted by the industry, the projected residual value average for the Chrysler group is 41.8 percent after three years of use.
Ford's corporate average is 40.9 percent, and GM's is 39.8 percent, according to Automotive Lease Guide. Those figures, a percentage of the original sticker price, are sales-weighted to represent the accurate model shares within the brand.
Below average
The industry average is 44.3 percent. All three domestic makers fall short of industry leaders. According to Automotive Lease Guide, Honda has the highest residuals among nonluxury brands after three years, at 53 percent, trailed closely by Toyota at 52.8 percent.
Chrysler says that the weighted corporate average is valid and that GM uses it in its own ads.
"GM uses a weighted approach in some of its own advertising," the Chrysler source says. "In their truck ads, they use corporate average. That kind of average is common. Toyota and Honda are constantly using residual value claims."
GM's Kuhlman would not comment on GM's use of residuals in its advertising.
Since they debuted the second weekend in July, the three Iacocca commercials have contained a statement that the residual value claim is based on data provided by Automotive Lease Guide, Aberlich says.
Ford also takes issue with Chrysler's assertion. Ford's new products have high residuals, says Ford spokesman Dave Reuter.
"It doesn't surprise me at all that Chrysler is claiming better residuals than GM," Reuter says. "Everyone does better than GM, which has some of the poorest residuals in history."
In Chrysler's recent TV commercials featuring former Chrysler Corp. Chairman Lee Iacocca, the automaker says Chrysler vehicles retain their value better than GM or Ford vehicles.
GM says that's not true if measured on a nameplate-by-nameplate basis. GM wants the Chrysler group to change the spots and is threatening to take action if it doesn't.
"We strongly disagree with the claims made in the current Chrysler advertising regarding the projected retained value of its vehicles compared to GM," says GM spokesman Jeff Kuhlman. "We are exploring various courses of action and have expressed our concerns to Chrysler."
GM sent a letter to Chrysler protesting the claim in the Iacocca commercials that Chrysler group vehicles "are projected to retain their values better than GM or Ford."
Chrysler is refusing to change the commercials, says Mike Aberlich, a Chrysler group spokesman.
"We respectfully disagree and we have responded to them," Aberlich says.
'Lawyer to lawyer'
Chrysler received GM's letter on Wednesday, July 20. Chrysler responded Thursday, July 21, Aberlich says.
Asked who signed the letters, Aberlich said the missives were "lawyer to lawyer" communications.
In its letter, GM asked Chrysler to withdraw its claim, Aberlich says.
A source close to the situation says GM will see whether Chrysler will bow to the pressure and retract its claim before pursuing further action. The source, who would not elaborate on what that action might be, says Chrysler has manipulated the data.
Chrysler, however, is sticking to its guns.
"The claim that we made was a Chrysler group weighted corporate average, and we stick by it," Aberlich says.
GM cited a nameplate-by-nameplate comparison in its letter to Chrysler, a Chrysler source says. Neither GM nor the source would not identify the vehicles cited.
According to year-to-date data from Automotive Lease Guide, a Santa Barbara, Calif., company that estimates residuals that are widely accepted by the industry, the projected residual value average for the Chrysler group is 41.8 percent after three years of use.
Ford's corporate average is 40.9 percent, and GM's is 39.8 percent, according to Automotive Lease Guide. Those figures, a percentage of the original sticker price, are sales-weighted to represent the accurate model shares within the brand.
Below average
The industry average is 44.3 percent. All three domestic makers fall short of industry leaders. According to Automotive Lease Guide, Honda has the highest residuals among nonluxury brands after three years, at 53 percent, trailed closely by Toyota at 52.8 percent.
Chrysler says that the weighted corporate average is valid and that GM uses it in its own ads.
"GM uses a weighted approach in some of its own advertising," the Chrysler source says. "In their truck ads, they use corporate average. That kind of average is common. Toyota and Honda are constantly using residual value claims."
GM's Kuhlman would not comment on GM's use of residuals in its advertising.
Since they debuted the second weekend in July, the three Iacocca commercials have contained a statement that the residual value claim is based on data provided by Automotive Lease Guide, Aberlich says.
Ford also takes issue with Chrysler's assertion. Ford's new products have high residuals, says Ford spokesman Dave Reuter.
"It doesn't surprise me at all that Chrysler is claiming better residuals than GM," Reuter says. "Everyone does better than GM, which has some of the poorest residuals in history."
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From: Edmonton, Alberta
Originally Posted by Dan Martin
It was a pretty weak statement to begin with. It's not like any of the domestic brands are known for their resale value.
This is
but my dad was shocked when a two year old Civic was only a few thousand less than a brand new one. He said to me, "If you're gonna get one of those, you might as well just buy it new."Meanwhile, I see this ad in the paper:
1998 Pontiac Sunfire $1995
82000km, pw, pdl, ps, 5spd
and that's CDN dollars too!
Last edited by youngTL; Jul 26, 2005 at 02:03 PM.
'Big Daddy Diggler'
Joined: Jun 2001
Posts: 11,016
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From: Yonkers NY
Originally Posted by youngTL
The classic case of the pot calling the kettle black...
This is but my dad was shocked when a two year old Civic was only a few thousand less than a brand new one. He said to me, "If you're gonna get one of those, you might as well just buy it new."
Meanwhile, I see this ad in the paper:
1998 Pontiac Sunfire $1995
82000km, pw, pdl, ps, 5spd
and that's CDN dollars too!
This is
but my dad was shocked when a two year old Civic was only a few thousand less than a brand new one. He said to me, "If you're gonna get one of those, you might as well just buy it new."Meanwhile, I see this ad in the paper:
1998 Pontiac Sunfire $1995
82000km, pw, pdl, ps, 5spd
and that's CDN dollars too!
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DaimlerChrysler CEO Schrempp to Step Down
DaimlerChrysler CEO Schrempp to Step Down - - By Matt Moore, AP Business Writer - - Source: biz.yahoo.com
FRANKFURT, Germany (AP) -- DaimlerChrysler CEO Juergen Schrempp, architect of the controversial merger between Daimler-Benz and Chrysler Corp., will step down and turn the top job over to Chrysler head Dieter Zetsche, the company said Thursday.
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Zetsche will be replaced at Chrysler by current No. 2 Thomas LaSorda in changes that take effect at the end of the year. Chrysler executive Eric Ridenour will take LaSorda's place.
The news came as the world's fifth-largest automaker reported improved quarterly earnings and a slight rise in sales. DaimlerChrysler's shares jumped nearly 10 percent after the announcements. The stock traded at 39.80 euros ($47.72) by afternoon in Frankfurt.
Schrempp, who started with the company 44 years ago as an apprentice mechanic, designed the 1998 merger of Germany's Daimler-Benz and Detroit's Chrysler Corp. in an attempt to create a global auto giant. The merged company has struggled, first with heavy losses at the Chrysler division and now with weak earnings at its former cash cow, Mercedes.
Some investors have criticized Schrempp because the company's stock price has lagged since the merger. Comments he made about the deal in a newspaper interview also led to investor Kirk Kerkorian suing the company over the terms of the deal, a suit the billionaire lost earlier this year.
In a letter to employees, Schrempp said that "through our brand and product portfolio and our presence in more than 200 countries, we are uniquely positioned. Profits have risen steadily and we are on the way to reaching the goals set under my chairmanship."
"In view of this positive development, the board of directors of DaimlerChrysler and I agreed that the end of 2005 would be the best time for a change in leadership of the company."
Schrempp said during a conference call that he was leaving in good spirits.
"All in all I am satisfied with the advances made," he said. "Clearly DaimlerChrysler is not yet where it wants to be, although I am sure it will arrive. We are heading precisely in the right direction."
"On a personal note, I can assure you that I am a very happy man."
Zetsche, 52, has earned plaudits for his turnaround of Chrysler, which has bounced back on the strength of hot-selling new models such as the 300.
DaimlerChrysler said Schrempp, whose contract was valid through 2008, would leave at the end of the year and would draw no salary after the end of 2005.
The supervisory board and Schrempp "are in full agreement that the end of the year 2005 is the optimal time for a change in the leadership of the company," board Chairman Hilmar Kopper said. "The decisions of the supervisory board have been made unanimously after a thorough process."
Schrempp began as an apprentice mechanic in 1961. He has risen through management positions including the leadership of Daimler-Benz operations in South Africa, the United States and in Germany. He also served as chairman of Daimler-Benz Aerospace.
The news partly overshadowed DaimlerChrysler's release of second-quarter earnings, which came to 737 million euros ($884 million) compared with 577 million euros a year earlier. Its operating profit fell 20 percent to 1.67 billion euros from 2.09 billion euros.
Sales during the quarter rose slightly to 38.4 billion euros ($46.04 billion) from 37.07 billion euros.
The results were helped by a strong performance from the truck and bus unit, which offset narrower earnings in its luxury Mercedes Car Group unit.
The Mercedes unit posted a scant operating profit of 12 million euros ($14.39 million) for the quarter, a 98 percent drop from last year. Revenue was 12.4 billion euros ($14.87 billion), down 4 percent from 12.97 billion euros.
The company's Chrysler Group, however, showed a 4 percent gain with operating profit rising to 544 million euros ($652.26 million) from 521 million euros a year ago. Sales were down 1 percent to 13.03 billion euros ($15.62 billion) from 13.2 billion euros.
The number of Chrysler cars sold rose 4 percent to 812,200 from 781,400.
http://www.daimlerchrysler.com
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Zetsche will be replaced at Chrysler by current No. 2 Thomas LaSorda in changes that take effect at the end of the year. Chrysler executive Eric Ridenour will take LaSorda's place.
The news came as the world's fifth-largest automaker reported improved quarterly earnings and a slight rise in sales. DaimlerChrysler's shares jumped nearly 10 percent after the announcements. The stock traded at 39.80 euros ($47.72) by afternoon in Frankfurt.
Schrempp, who started with the company 44 years ago as an apprentice mechanic, designed the 1998 merger of Germany's Daimler-Benz and Detroit's Chrysler Corp. in an attempt to create a global auto giant. The merged company has struggled, first with heavy losses at the Chrysler division and now with weak earnings at its former cash cow, Mercedes.
Some investors have criticized Schrempp because the company's stock price has lagged since the merger. Comments he made about the deal in a newspaper interview also led to investor Kirk Kerkorian suing the company over the terms of the deal, a suit the billionaire lost earlier this year.
In a letter to employees, Schrempp said that "through our brand and product portfolio and our presence in more than 200 countries, we are uniquely positioned. Profits have risen steadily and we are on the way to reaching the goals set under my chairmanship."
"In view of this positive development, the board of directors of DaimlerChrysler and I agreed that the end of 2005 would be the best time for a change in leadership of the company."
Schrempp said during a conference call that he was leaving in good spirits.
"All in all I am satisfied with the advances made," he said. "Clearly DaimlerChrysler is not yet where it wants to be, although I am sure it will arrive. We are heading precisely in the right direction."
"On a personal note, I can assure you that I am a very happy man."
Zetsche, 52, has earned plaudits for his turnaround of Chrysler, which has bounced back on the strength of hot-selling new models such as the 300.
DaimlerChrysler said Schrempp, whose contract was valid through 2008, would leave at the end of the year and would draw no salary after the end of 2005.
The supervisory board and Schrempp "are in full agreement that the end of the year 2005 is the optimal time for a change in the leadership of the company," board Chairman Hilmar Kopper said. "The decisions of the supervisory board have been made unanimously after a thorough process."
Schrempp began as an apprentice mechanic in 1961. He has risen through management positions including the leadership of Daimler-Benz operations in South Africa, the United States and in Germany. He also served as chairman of Daimler-Benz Aerospace.
The news partly overshadowed DaimlerChrysler's release of second-quarter earnings, which came to 737 million euros ($884 million) compared with 577 million euros a year earlier. Its operating profit fell 20 percent to 1.67 billion euros from 2.09 billion euros.
Sales during the quarter rose slightly to 38.4 billion euros ($46.04 billion) from 37.07 billion euros.
The results were helped by a strong performance from the truck and bus unit, which offset narrower earnings in its luxury Mercedes Car Group unit.
The Mercedes unit posted a scant operating profit of 12 million euros ($14.39 million) for the quarter, a 98 percent drop from last year. Revenue was 12.4 billion euros ($14.87 billion), down 4 percent from 12.97 billion euros.
The company's Chrysler Group, however, showed a 4 percent gain with operating profit rising to 544 million euros ($652.26 million) from 521 million euros a year ago. Sales were down 1 percent to 13.03 billion euros ($15.62 billion) from 13.2 billion euros.
The number of Chrysler cars sold rose 4 percent to 812,200 from 781,400.
http://www.daimlerchrysler.com
:gheyfight:
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Originally Posted by biker
Any changes like this won't be seen in cars for at least 3-4 years.
I'd say more like 6-8 years. Because what's coming in 3-4 has already been decided.
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Cordes Wants Out of Mercedes? - - Source: The Car Connection
Another resignation may accompany that of Juergen Schrempp from DaimlerChrysler. A Reuters report says that Eckhard Cordes, the head of the Mercedes Car Group, may also tender his resignation to the board of supervisors for the German automaker. Cordes, appointed last year to the Mercedes post, was passed over to succeed Schrempp in favor of Chrysler Group CEO Dieter Zetsche. The report, ascribed toGermany's Manager Magazin, says that Cordes has offered his resignation because he feels he has lost the confidence of the board of directors. Zetsche replaces Schrempp on January 1, 2006.
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Originally Posted by gavriil
Schrempp began as an apprentice mechanic in 1961. He has risen through management positions including the leadership of Daimler-Benz operations in South Africa, the United States and in Germany. He also served as chairman of Daimler-Benz Aerospace.
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What should Dieter Zetsche's top priorities be?
Question of the day - - Automotive News / August 02, 2005 - - Source: Automotive News
Attendees at the Management Briefing Seminars were asked:
What should Dieter Zetsche's top priorities be when he takes over as CEO of DaimlerChrysler?
"His priority should be to go back to the roots of Mercedes-Benz in the development strategy. Mercedes-Benz was always good when an engineer was in charge. They should go back and make Mercedes the best, most solid engineered cars in the world."
Peter Hofbauer
Executive vice president of research and development, FEV Engine Technology
“Continue the momentum of their new products. Their products are different, they stand out, they are very appealing to many people."
Patricia Dilger
Director of sales for Automotive and Industrial Equipment Vertical, Microsoft Corp.
"Product is the key, obviously. We see from our initial product quality and initial dependability studies that Mercedes-Benz quality is getting better, and Dieter needs to keep his eye on the ball there too.
John Tewes
Spokesman, J.D. Power and Associates
What should Dieter Zetsche's top priorities be when he takes over as CEO of DaimlerChrysler?
"His priority should be to go back to the roots of Mercedes-Benz in the development strategy. Mercedes-Benz was always good when an engineer was in charge. They should go back and make Mercedes the best, most solid engineered cars in the world."
Peter Hofbauer
Executive vice president of research and development, FEV Engine Technology
“Continue the momentum of their new products. Their products are different, they stand out, they are very appealing to many people."
Patricia Dilger
Director of sales for Automotive and Industrial Equipment Vertical, Microsoft Corp.
"Product is the key, obviously. We see from our initial product quality and initial dependability studies that Mercedes-Benz quality is getting better, and Dieter needs to keep his eye on the ball there too.
John Tewes
Spokesman, J.D. Power and Associates
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Patricia is soooo trying to be politically correct! Phew!
The R&D guy gives the answer from his world's point of view. We're engineers and we want to be in charge making the product!
And the JD Power guy talks about quality. Same as above.
Yet no one wants to think outside the box.
The R&D guy gives the answer from his world's point of view. We're engineers and we want to be in charge making the product!
And the JD Power guy talks about quality. Same as above.
Yet no one wants to think outside the box.
I feel the need...
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From: Motown
Chrysler Repairman Zetsche Now Must Fix Mercedes: Doron Levin
2005-08-08 02:06 (New York)
(Commentary. Doron Levin is a Bloomberg News columnist.
The opinions expressed are his own.)
By Doron Levin
Aug. 8 (Bloomberg) -- Dieter Zetsche was called upon to do
what many said was impossible five years ago: Fix the mess his
boss at DaimlerChrylser AG created when he bought the smallest
of Detroit's carmakers, Chrysler Corp.
He succeeded beyond expectations, knocking cross-town
rivals General Motors Corp. and Ford Motor Co. back on their
heels with snazzy designs like the Chrysler 300. He got the
finances right too, using new models and cost-cutting to help
the Chrysler division post more than a half-billion dollar
profit in the latest quarter.
Zetsche collected his reward last month when he was picked
to replace Chief Executive Officer Juergen Schrempp, 60, and
patch up another problem, this time at headquarters in
Stuttgart. Management is in disarray. Mercedes, the most-storied
name in German automotive history, is beset by poor quality and
dismal financial results. U.S. investigators have opened a probe
of bribery allegations.
``With Lexus, BMW and everyone moving up into luxury
vehicles, Mercedes was standing still,'' said David Cole, head
of the Center for Automotive Research in Ann Arbor, Michigan.
``Then they tried to force an awful lot of technology too
quickly.''
Replacing Schrempp
The trouble that Zetsche, 52, faces at Mercedes when he
takes over for the retiring Schrempp in January could be even
more difficult than what he faced at Chrysler. There, employees
were expecting an authoritarian tyrant. Instead, they were
disarmed by his open, genial style and willingness to listen.
In Stuttgart he'll confront a company beset by factional
politics. Eckhard Cordes, head of the Mercedes Group and a rival
of Zetsche's, tendered his resignation upon learning of
Schrempp's retirement and Zetsche's promotion. Cordes sold
company stock valued at 3.66 million euros ($4.47 million) in
the days following the July 28 announcement of Zetsche's
promotion. DaimlerChrysler still hasn't announced formally that
Cordes is leaving.
In April, 2004 Cordes, Schrempp and a third member of the
company's management board, Ruediger Grube, lost in a showdown
over Schrempp's desire to invest more money in ailing Mitsubishi
Motor Corp., 12 percent owned by DaimlerChrysler. Zetsche
opposed the investment.
Schrempp already had been under fire from German investors
because of poor financial and lagging stock performance. The
loss to Zetsche over the Mitsubishi investment signified his
diminishing power and sapped his authority.
Soap Opera
Last year, Schrempp raised eyebrows when he reversed his
earlier promotion of Wolfgang Bernhard, to run the Mercedes
Group. Bernhard, who had been Zetsche's No. 2 in the U.S.,
subsequently left DaimlerChrysler, paving the way for Cordes at
Mercedes.
Bernhard, now head of the Volkswagen unit at Volkswagen AG,
had opposed Schrempp and the Mitsubishi investment. He also
offended veteran Mercedes workers and the metalworkers' union by
promising a shakeup that would improve Mercedes's quality and
efficiency. Now he's a competitor with knowledge of
DaimlerChrysler's playbook.
Adding to Zetsche's headaches, DaimlerChrysler said in
filings in late July that it has been cooperating with a U.S.
Department of Justice probe into allegations that certain
Mercedes employees had bribed foreign officials.
In March, the company recalled 1.3 million Mercedes cars,
the biggest recall ever. Cordes and other Mercedes executives
earlier had said that quality problems were resolved.
Losing Power
In a J.D. Power & Associates reliability study of three-
year-old cars released in June 2004, Mercedes ranked 29th out of
37 brands and behind such makes as Mercury and Mazda.
To improve Mercedes quality, Zetsche will have to promote
techniques developed by companies such as Toyota Motor Corp.
aimed at finding and correcting the root causes of defects -- an
approach at odds with the more traditional method of inspecting
and repairing defective vehicles before they leave the plant.
He'll also have to promote improved coordination with
suppliers such as Robert Bosch Gmbh of Stuttgart, whose parts
are found in most German-made models and have been responsible
for a number of recalls and production slowdowns.
Beyond the quality issues, Mercedes' vaunted position atop
the world of luxury cars has been challenged, as competitors
such as Bayerische Motoren Werke AG -- once a maker of sports
sedans -- have elbowed their way in to the category and stolen
sales.
Maybach Flop
Mercedes's attempt to enhance its image with the ultra-
luxury Maybach sedan, with a starting list price of $325,000,
has been a disappointment. Mercedes sold about 500 Maybachs last
year and 67 in the first quarter of 2005. At the other end of
the spectrum, the automaker's Smart small car has been a market
and financial disappointment.
DaimlerChrysler is spending 1.2 billion euros to overhaul
Smart and has said it expects the brand to break even by 2007, a
projection greeted with skepticism among analysts.
Thus, the eventual selection of a new Mercedes chief will
be critical. Zetsche himself is likely to assume the duties as
head of the Mercedes Group, which includes Smart, at least
temporarily. But it isn't a position he can hold forever with so
many other trouble spots calling for his attention.
It wouldn't be too big a surprise if he's the one
introducing the new Mercedes S Class next month at the auto show
in Frankfurt.
How this line fares will be a harbinger of Mercedes's
prospects. The S Class, rather than the Maybach, is the brand's
top model, and often embodies advanced technology and design
later found in other models. The current S Class starts at
$64,900 and goes up to about $128,000.
The S Class, indeed all of DaimlerChrysler, needs every bit
of magic Zetsche can summons.
2005-08-08 02:06 (New York)
(Commentary. Doron Levin is a Bloomberg News columnist.
The opinions expressed are his own.)
By Doron Levin
Aug. 8 (Bloomberg) -- Dieter Zetsche was called upon to do
what many said was impossible five years ago: Fix the mess his
boss at DaimlerChrylser AG created when he bought the smallest
of Detroit's carmakers, Chrysler Corp.
He succeeded beyond expectations, knocking cross-town
rivals General Motors Corp. and Ford Motor Co. back on their
heels with snazzy designs like the Chrysler 300. He got the
finances right too, using new models and cost-cutting to help
the Chrysler division post more than a half-billion dollar
profit in the latest quarter.
Zetsche collected his reward last month when he was picked
to replace Chief Executive Officer Juergen Schrempp, 60, and
patch up another problem, this time at headquarters in
Stuttgart. Management is in disarray. Mercedes, the most-storied
name in German automotive history, is beset by poor quality and
dismal financial results. U.S. investigators have opened a probe
of bribery allegations.
``With Lexus, BMW and everyone moving up into luxury
vehicles, Mercedes was standing still,'' said David Cole, head
of the Center for Automotive Research in Ann Arbor, Michigan.
``Then they tried to force an awful lot of technology too
quickly.''
Replacing Schrempp
The trouble that Zetsche, 52, faces at Mercedes when he
takes over for the retiring Schrempp in January could be even
more difficult than what he faced at Chrysler. There, employees
were expecting an authoritarian tyrant. Instead, they were
disarmed by his open, genial style and willingness to listen.
In Stuttgart he'll confront a company beset by factional
politics. Eckhard Cordes, head of the Mercedes Group and a rival
of Zetsche's, tendered his resignation upon learning of
Schrempp's retirement and Zetsche's promotion. Cordes sold
company stock valued at 3.66 million euros ($4.47 million) in
the days following the July 28 announcement of Zetsche's
promotion. DaimlerChrysler still hasn't announced formally that
Cordes is leaving.
In April, 2004 Cordes, Schrempp and a third member of the
company's management board, Ruediger Grube, lost in a showdown
over Schrempp's desire to invest more money in ailing Mitsubishi
Motor Corp., 12 percent owned by DaimlerChrysler. Zetsche
opposed the investment.
Schrempp already had been under fire from German investors
because of poor financial and lagging stock performance. The
loss to Zetsche over the Mitsubishi investment signified his
diminishing power and sapped his authority.
Soap Opera
Last year, Schrempp raised eyebrows when he reversed his
earlier promotion of Wolfgang Bernhard, to run the Mercedes
Group. Bernhard, who had been Zetsche's No. 2 in the U.S.,
subsequently left DaimlerChrysler, paving the way for Cordes at
Mercedes.
Bernhard, now head of the Volkswagen unit at Volkswagen AG,
had opposed Schrempp and the Mitsubishi investment. He also
offended veteran Mercedes workers and the metalworkers' union by
promising a shakeup that would improve Mercedes's quality and
efficiency. Now he's a competitor with knowledge of
DaimlerChrysler's playbook.
Adding to Zetsche's headaches, DaimlerChrysler said in
filings in late July that it has been cooperating with a U.S.
Department of Justice probe into allegations that certain
Mercedes employees had bribed foreign officials.
In March, the company recalled 1.3 million Mercedes cars,
the biggest recall ever. Cordes and other Mercedes executives
earlier had said that quality problems were resolved.
Losing Power
In a J.D. Power & Associates reliability study of three-
year-old cars released in June 2004, Mercedes ranked 29th out of
37 brands and behind such makes as Mercury and Mazda.
To improve Mercedes quality, Zetsche will have to promote
techniques developed by companies such as Toyota Motor Corp.
aimed at finding and correcting the root causes of defects -- an
approach at odds with the more traditional method of inspecting
and repairing defective vehicles before they leave the plant.
He'll also have to promote improved coordination with
suppliers such as Robert Bosch Gmbh of Stuttgart, whose parts
are found in most German-made models and have been responsible
for a number of recalls and production slowdowns.
Beyond the quality issues, Mercedes' vaunted position atop
the world of luxury cars has been challenged, as competitors
such as Bayerische Motoren Werke AG -- once a maker of sports
sedans -- have elbowed their way in to the category and stolen
sales.
Maybach Flop
Mercedes's attempt to enhance its image with the ultra-
luxury Maybach sedan, with a starting list price of $325,000,
has been a disappointment. Mercedes sold about 500 Maybachs last
year and 67 in the first quarter of 2005. At the other end of
the spectrum, the automaker's Smart small car has been a market
and financial disappointment.
DaimlerChrysler is spending 1.2 billion euros to overhaul
Smart and has said it expects the brand to break even by 2007, a
projection greeted with skepticism among analysts.
Thus, the eventual selection of a new Mercedes chief will
be critical. Zetsche himself is likely to assume the duties as
head of the Mercedes Group, which includes Smart, at least
temporarily. But it isn't a position he can hold forever with so
many other trouble spots calling for his attention.
It wouldn't be too big a surprise if he's the one
introducing the new Mercedes S Class next month at the auto show
in Frankfurt.
How this line fares will be a harbinger of Mercedes's
prospects. The S Class, rather than the Maybach, is the brand's
top model, and often embodies advanced technology and design
later found in other models. The current S Class starts at
$64,900 and goes up to about $128,000.
The S Class, indeed all of DaimlerChrysler, needs every bit
of magic Zetsche can summons.
Thread Starter
Moderator Alumnus
Joined: Oct 2000
Posts: 16,399
Likes: 8
From: Washington DC (NOVA)
Zetsche to head Mercedes and DaimlerChrysler
Zetsche to head Mercedes and DaimlerChrysler - - Reuters / August 18, 2005 - - Source: AUtomotive News
FRANKFURT -- Chrysler group CEO Dieter Zetsche, set to run parent DaimlerChrysler on Jan. 1, 2006, will take charge of its struggling Mercedes Car Group on Sept. 1, DaimlerChrysler said on Thursday.
Current Mercedes chief Eckhard Cordes, who was passed over in the race for the group chief executive job, is leaving the world's fifth-biggest carmaker at the end of August at his own request, the Stuttgart-based company said in a statement.
Under the accelerated switchover, Daimler said Chrysler group COO Tom LaSorda will move up to CEO on Sept. 1, four months earlier than first planned.
Zetsche's taking control of Mercedes had been well flagged in the German media, but may last far longer than the time it would take simply to find a permanent replacement for Cordes.
"It can be somewhat longer term, perhaps even more than a year," a company source said on condition of anonymity, but he added a search was already on for an internal successor.
Zetsche, 52, "wants to stabilize the situation at Mercedes. He wants to restore calm. He wants to tackle the challenge of (loss-making minicar unit) Smart and the whole quality issue and wants to continue on the path that has been started down," the source said.
Cordes, 54, took over at Mercedes in October after heading the commercial vehicles business. He quit when the carmaker picked Zetsche last month to replace Juergen Schrempp, who shocked markets with news that he would leave at year's end.
Respected for engineering a successful turnaround at Chrysler, the walrus-moustached Zetsche inherits a problem child in Mercedes, which is battling to restore its traditional role as the company's cash cow. The company has forecast a slight rise in 2005 unit sales at Mercedes Car Group -- which includes the Mercedes-Benz, Smart and Maybach limousine brands -- as it rolls out new models.
Grappling with the strong euro, model changeovers, hefty losses at Smart and costs of fixing embarrassing quality problems at Mercedes-Benz, the unit plunged to a first-quarter operating loss of 954 million euros ($1.17 billion) -- its first red ink since an annual loss in 1993.
It returned to a small operating profit of 12 million euros in the second quarter despite taking more charges to restructure Smart, the urban minicar that has lost money since its debut in 1998.
The profit collapse prompted a new efficiency drive that aims to boost earnings at the division by more than 3 billion euros and restore an operating margin of 7 percent by 2007.
Current Mercedes chief Eckhard Cordes, who was passed over in the race for the group chief executive job, is leaving the world's fifth-biggest carmaker at the end of August at his own request, the Stuttgart-based company said in a statement.
Under the accelerated switchover, Daimler said Chrysler group COO Tom LaSorda will move up to CEO on Sept. 1, four months earlier than first planned.
Zetsche's taking control of Mercedes had been well flagged in the German media, but may last far longer than the time it would take simply to find a permanent replacement for Cordes.
"It can be somewhat longer term, perhaps even more than a year," a company source said on condition of anonymity, but he added a search was already on for an internal successor.
Zetsche, 52, "wants to stabilize the situation at Mercedes. He wants to restore calm. He wants to tackle the challenge of (loss-making minicar unit) Smart and the whole quality issue and wants to continue on the path that has been started down," the source said.
Cordes, 54, took over at Mercedes in October after heading the commercial vehicles business. He quit when the carmaker picked Zetsche last month to replace Juergen Schrempp, who shocked markets with news that he would leave at year's end.
Respected for engineering a successful turnaround at Chrysler, the walrus-moustached Zetsche inherits a problem child in Mercedes, which is battling to restore its traditional role as the company's cash cow. The company has forecast a slight rise in 2005 unit sales at Mercedes Car Group -- which includes the Mercedes-Benz, Smart and Maybach limousine brands -- as it rolls out new models.
Grappling with the strong euro, model changeovers, hefty losses at Smart and costs of fixing embarrassing quality problems at Mercedes-Benz, the unit plunged to a first-quarter operating loss of 954 million euros ($1.17 billion) -- its first red ink since an annual loss in 1993.
It returned to a small operating profit of 12 million euros in the second quarter despite taking more charges to restructure Smart, the urban minicar that has lost money since its debut in 1998.
The profit collapse prompted a new efficiency drive that aims to boost earnings at the division by more than 3 billion euros and restore an operating margin of 7 percent by 2007.
Thread Starter
Moderator Alumnus
Joined: Oct 2000
Posts: 16,399
Likes: 8
From: Washington DC (NOVA)
Chrysler betting on new SUV lines, report says
Chrysler pinning hopes on new SUV lines, report says - - Reuters / September 26, 2005 - - Source: Automotive News
NEW YORK -- The Chrysler group is making a big bet on SUVs at a time when rising gasoline prices have focused attention on fuel efficiency, the Wall Street Journal reported on Monday.
The newspaper said Chrysler is preparing five all-new SUVs for launch over the next few years as part of a product offensive that will also include a two-door Challenger sports coupe to compete with Ford Motor Co.'s Mustang, according to dealers and consultants briefed on the company's plans.
The new SUVs mostly fall in the small and mid-sized categories that have continued to sell well despite rising gasoline prices that have hurt demand for larger SUVs, the newspaper said.
It said DaimlerChrysler's supervisory board is set to see a presentation of some or all of the SUVs and a half dozen or so redesigns of existing Chrysler Group models at a dinner meeting Tuesday night at the U.S. unit's design center in Auburn Hills, Mich.
The plan is still subject to change, the newspaper said.
The newspaper said Chrysler is preparing five all-new SUVs for launch over the next few years as part of a product offensive that will also include a two-door Challenger sports coupe to compete with Ford Motor Co.'s Mustang, according to dealers and consultants briefed on the company's plans.
The new SUVs mostly fall in the small and mid-sized categories that have continued to sell well despite rising gasoline prices that have hurt demand for larger SUVs, the newspaper said.
It said DaimlerChrysler's supervisory board is set to see a presentation of some or all of the SUVs and a half dozen or so redesigns of existing Chrysler Group models at a dinner meeting Tuesday night at the U.S. unit's design center in Auburn Hills, Mich.
The plan is still subject to change, the newspaper said.
Senior Moderator
Joined: Jul 2003
Posts: 21,672
Likes: 1
From: Toronto
Chrysler Group to Give Free Gas With Car
Chrysler Group to Give Free Gas With Car
Thursday November 17, 3:10 pm ET
DETROIT (AP) -- DaimlerChrysler AG's Chrysler Group said Thursday it will give two years of free gas to customers who buy a 2005 or 2006 vehicle before Jan. 3, following announcements of new discounts by rivals General Motors Corp. and Ford Motor Co.
Chrysler will also kick in two years of free scheduled maintenance and increase the warranty on mechanical parts to five years or 60,000 miles. Chrysler now offers a three-year, 36,000-mile warranty. The offer, called the "Miles of Freedom" plan, begins Monday.
http://ca.us.biz.yahoo.com/ap/051117...ives.html?.v=4
Thursday November 17, 3:10 pm ET
DETROIT (AP) -- DaimlerChrysler AG's Chrysler Group said Thursday it will give two years of free gas to customers who buy a 2005 or 2006 vehicle before Jan. 3, following announcements of new discounts by rivals General Motors Corp. and Ford Motor Co.
Chrysler will also kick in two years of free scheduled maintenance and increase the warranty on mechanical parts to five years or 60,000 miles. Chrysler now offers a three-year, 36,000-mile warranty. The offer, called the "Miles of Freedom" plan, begins Monday.
http://ca.us.biz.yahoo.com/ap/051117...ives.html?.v=4
Fahrvergnügen'd
Joined: Mar 2001
Posts: 13,494
Likes: 1,569
From: Maryland
Originally Posted by AsianRage
That's a great deal. Charger ST8 + Unlimited Gas = 
Still it's probably another $2k in free gas