Free Republic

Link only, per FR copyright rules

Fiat's grand plan for Chrysler's revival sounds awfully familiar. Possible, but still a dream. Chrysler's five-year recovery plan announced Wednesday reveals some good news but a lot of dreams and promises of great improvements. The good news was how its cash had grown by $1.7 billion, to $5.7 billion at the end of September, plus $200 million in earnings before interest, taxes, depreciation and amortization. Of course, Chrysler got $12 billion in help from the government. The dreams involved about everything else: new products to come, new engines, new quality, new manufacturing processes, a doubling of sales per dealer, $3...

C4C Since “Cash For Clunkers” applied to Ford, GM and Chrysler. Why did Ford Motor Company post a ONE BILLION DOLLAR 3rd quarter PROFIT and GM and Chrysler post losses? It couldn’t be the autos since all models are about the same size, design and price. I believe it was the consumer buying more Fords as a REWARD for not taking TARP money and remaining a private company. The more units sold, the more profit. Consumer votes have been cast. Ford, GM and Chrysler have gone their separate ways. Now when GM and Chrysler look up they see the gutter...

China to launch case against U.S. Big Three automakers Doug Palmer Thu, Oct 29 08:37 AM China has told the United States it is launching a trade investigation that could lead to new import duties on autos and sports utility vehicles made by Chrysler, Ford and General Motors, a U.S. industry official said on Wednesday. The action comes as U.S. Commerce Secretary Gary Locke, Trade Representative Ron Kirk and Agriculture Secretary Tom Vilsack are in China for high-level talks aimed at resolving trade irritants between the two countries. President Barack Obama, who will visit China in mid-November, angered Beijing last...

Four months after exiting a U.S.-funded bankruptcy reorganization, Chrysler Group LLC is about to unveil a product roadmap that relies heavily on vehicles from Italian partner Fiat SpA while abandoning many of the U.S. car maker's own models. The plan, due to be revealed Nov. 4, involves the return of Fiat's premium, sporty Alfa Romeo brand to the U.S. starting in 2012, according to people briefed on the plans. Chrysler also will introduce to Americans the 500, Fiat's tiny car that is popular in Europe. The company meantime is preparing to phase out many of the company's current models, particularly...

As part of the Fiat - Chrysler alliance, the Italian carmaker will bring several new models in the United States but the 500 mini car will be the only one to be sold under the Fiat badge. The car is going to be produced by Chrysler in Mexico and, according to people close to the matter, the US-based former bankrupt automaker has already required suppliers to make sure that their parts are enough for around 100,000 Fiat 500. The Fiat 500 produced in Mexico will be sold in the US, Canada and South America, Bloomberg reported, with initial production goals...

Pay Czar Feinberg, Not Obama, Behind Decision to Slash Executive Pay White House pay czar Kenneth Feinberg did not seek President Obama's approval to order steep pay cuts from bailed-out executives. Thursday, October 22, 2009 White House pay czar Kenneth Feinberg was the driving force behind the move to order steep pay cuts from bailed-out executives, and did not even seek the president's approval before making his decision. The Treasury Department is expected to formally announce in the next few days a plan to slash annual salaries by about 90 percent from last year for the 25 highest-paid executives at...

Shockingly poor financial management at General Motors and Chrysler weakened their case for a federal bailout, but officials feared letting them collapse, the former head of a government auto task force said Wednesday. In a first-person account posted on Fortune magazine's Web site and in a Brookings Institution speech, Steven Rattner said he was alarmed by the "stunningly poor management" at the Detroit companies and said GM had "perhaps the weakest finance operation any of us had ever seen in a major company." GM's board of directors was "utterly docile in the face of mounting evidence of a looming disaster"...

[Full title was edited to comply with space requirements, here's unedited version:] "Well-Kept Media Secret: UAW Conceded No Base Pay, Health, or Pension Benefits in GM, Chrysler Bankruptcy Run-ups" A New York Times article by Nick Bunkley on Friday targeted for print on Saturday about the status of contract talks between Ford Motor Company and the United Auto Workers piqued my interest in a previously neglected but important matter. Ford and the UAW are apparently close to an agreement. In describing what Ford workers are being asked to give up, Bunkley wrote the following (bolds are mine throughout this post):...

DETROIT – In a stunning shake-up, Chrysler Group LLC appointed new chief executives for its Chrysler and Dodge brands as the heads of each line resigned. Peter Fong, chief of the Chrysler brand, resigned for personal reasons and Michael Accavitti, head of the Dodge brand, left for personal reasons, the Auburn Hills, Mich., auto maker said Monday. Mr. Fong will be succeeded by Fiat SpA veteran Olivier Francois. The changes mean the introduction of another Fiat executive into the Chrysler ranks. Mr. Francois serves as head of the Lancia brand for Fiat Group Automobiles, a position he will retain. He...

Reviewing September's detailed sales results in the car business carried at the Wall Street Journal, three things stick out immediately: The awful performance at General Motors -- down 45% from September 2008. Chrysler's even worse performance -- down "only" 42% from September 2008, but a mind-boggling 61% from September 2007 (62,197 in 2009, 156,799 in 2007) Ford's tiny decline of only 6% from a year ago, despite the end of the Cash For Clunkers program in August. No other major maker had a year-over-year September decline that was even half of that seen at GM or Chrysler. Yet the...

U.S. auto sales tumbled by 23 percent in September as showrooms emptied after the government-funded boom from the "cash for clunkers" program, with General Motors Co and Chrysler hardest-hit. Sales for General Motors Co and Chrysler -- the two U.S. automakers struggling to regain momentum after emerging from bankruptcy -- dropped by 45 percent and 42 percent, respectively. Ford -- the only U.S. automaker to have avoided bankruptcy -- managed to hold its sales decline to 5 percent from a year earlier despite low inventories and reduced incentives for car shoppers. Automakers had braced for a sharp pullback in September...

Chrysler thinks its future may be in a new lineup of smaller cars based on models from Italian partner Fiat. The question is how to make them for Americans put off by stiff suspensions, firm seats and - perish the thought - not enough cupholders. The problem is further complicated because Americans generally are plumper and taller than Western Europeans, and they're used to driving fatter and longer cars. It's a dilemma faced by nearly all automakers as they try to hold down development costs by tailoring cars to sell around the globe. But at no company is the problem...

DETROIT — The old Chrysler — the automaker’s leftover assets that remain in bankruptcy court — lost $344 million in July, and the company continues negotiating with the U.S. Treasury over a new schedule for repaying $3.3 billion in loans that are technically in default. The July loss, reported in a bankruptcy filing, was down sharply from a $10.2 billion loss reported for June. That large loss reflected the government-financed sale of the automaker’s most viable assets to Chrysler Group LLC. That new Chrysler company is owned 20 percent by Fiat, 67.7 percent by the UAW’s Voluntary Employee Beneficiary Association...

Governments and schools across Michigan are bracing for the possible loss of millions of dollars in tax revenue as General Motors Co. and Chrysler Group LLC argue that they should pay less in property taxes... More at link.

Chrysler Group LLC Deputy Chief Executive Jim Press appears to have fallen victim to the same financial crisis that pushed the auto maker into bankruptcy earlier this year, according to documents filed in a Michigan county court. Mr. Press, who was kept on in senior management after Fiat SpA took control of Chrysler in June, owes $947,410 in back taxes to the federal government and has defaulted on $609,286 he owes Western Federal Credit Union, according to the documents filed in Oakland County. In a letter last November to the Manhattan Beach, Calif.-based credit union, Mr. Press said he was...

NEW YORK (CNNMoney.com) -- The situation at recently rescued Chrysler Group is even more dire than first thought, the CEO of Italy's Fiat -- which came to the aid of the U.S. automaker -- said Wednesday. "We were surprised by how little had been done in the past 24 months," Sergio Marchionne told reporters in Frankfurt, Germany. Chrysler will present a revised business plan in November, Marchionne told reporters.

New York - Chrysler Financial employees traveling on business can no longer be reimbursed for lunch on trips that don't require an overnight stay. If flying on business, they must travel coach if the flight is less than four hours. Tips to baggage handlers shouldn't exceed $2 per bag. The $4 cost of an in-flight movie? Not reimbursable. The company's new expense rules, posted on its website Friday, are among a handful of policies that have been made public so far as hundreds of companies receiving federal rescue funds scramble to meet a deadline Monday to put in place policies...

A Congressional oversight panel warns taxpayers are facing huge losses on the government’s $81 billion auto industry bailout. Elizabeth Warren, the panel’s chair, discusses the findings. * The report said that a $5.4 billion portion of the $10.5 billion owed by Chrysler is “highly unlikely” to be repaid. * Full recovery of the $50 billion sunk into GM would require the company’s stock to reach unprecedented heights. * The report also recommended that the Treasury Department provide a legal analysis justifying the use of financial rescue funds for the automakers. * In all, the government has invested $74 billion in...

Taxpayers face losses on a significant portion of the $81 billion in government aid provided to the auto industry, an oversight panel said in a report to be released Wednesday. The Congressional Oversight Panel did not provide an estimate of the projected loss in its latest monthly report on the $700 billion Troubled Asset Relief Program. But it said most of the $23 billion initially provided to General Motors Corp. and Chrysler LLC late last year is unlikely to be repaid. "I think they drove a very hard bargain," said Elizabeth Warren, the panel's chairwoman and a law professor at...

A few weeks ago, Government Motors dropped a public relations bomb when new chief Fritz Henderson announced that the forthcoming Chevy Volt would get an astonishing 230 miles per gallon (that's 98 kilometers per liter, for our metric-system friends). We'll stop short of calling it a fabrication and instead chalk it up to a classic apples-to-oranges comparison. After all, the Volt will be powered more by coal than by oil. United States EPA mileage guidelines are based on a bunch of hypothetical “typical” driving patterns. And the makers of conventional and plug-in hybrid cars are lobbying hard to change those...

Link only

... Having aggressively, even promiscuously, blurred the distinction between public and private sectors with improvised and largely unauthorized interventions in the economy, will [President Obama and other statists] ever countenance a retreat of the state? Or do they have an aspiration that they dare not speak? Do they hope that state capitalism will be irreversible — that wherever government has asserted the primacy of politics, the primacy will be permanent? They say not, but they say many things that they probably do not believe. (That a government-run "public option" health insurance would not extinguish or even harm private insurance; that...

Politicians are putting pressure on private-sector opponents Government coercion is becoming standard operating procedure in the nation's capital. The White House threatened financial institutions with ruin by selectively enforcing regulations unless they agreed to take government bailout money. Similar threats were used to force financial institutions to let the government own part of their stock. Those same institutions were forced to take losses on the bonds they held in General Motors and Chrysler. It was only a matter of time until similar intimidating behavior was employed in the health care debate.

Chrysler Group LLC Deputy Chief Executive Jim Press is planning to leave the auto maker by November, according to three people who have been informed of the plan. Press, 62, was the only member of Chrysler’s senior leadership team to remain with the company after a fast-track bankruptcy under the supervision of the U.S. Treasury.

In the late 1970s, as the federal government arranged to bail out Chrysler, not-yet-famous economist Alan Greenspan warned the problem “was not that it would fail, but that it would succeed.” And it did, thus paving the way for more bailouts, including (again) Chrysler. But the first Chrysler bailout was just one company, one time. The rolling series of financial bailouts over the past year -- Fannie Mae and Freddie Mac, AIG and Citibank, General Motors and Chrysler, etc. -- have not yet succeeded or failed. But they’ve raised a new moral hazard. These days, having invested so much in...

As the Chrysler Group pulls itself out of bankruptcy, some of the replacement parts for its cars are still hard to come by, causing headaches for people trying to find them for cars in need of repair.

Now that Barack Obama has gotten GM Chairman Rick Wagoner out of the way, he is confident that GM is on the way to unimaginable success. The government has given GM and Chrysler $65.1 billion in bailout money, which is only appropriate. I mean, “millions” is so 90’s… To promote the sales of GM vehicles, Obama says it will be the government that will now stand by your GM car warranty. And the taxpayers all get a lube job. Your future GM owner’s manual will come with a disclaimer: “Close enough for government work.” I don’t know why everyone is...

NEW YORK — Chrysler Group LLC is planning to build the Fiat 500 small car at a plant in Mexico, according to a report published Monday. The automaker could also build an engine for the 500 at a plant in Trenton, Michigan, and is weighing building another compact car similar to the 500 in the U.S., according to The Wall Street Journal, which cited anonymous sources familiar with the matter. Chrysler spokesman Gualberto Ranieri declined to comment Monday.

Chrysler Group is planning to produce Fiat SpA's (FIA.MI) Fiat 500 subcompact at a Chrysler plant in Mexico, the Wall Street Journal reported, citing people familiar with the matter. Chrysler is also considering what other Fiat models to introduce to the U.S. market, under directions from its Italian partner, the paper reported on its website on Sunday. Plans also include making a small Fiat engine for the 500 at a Chrysler plant in Trenton, Michigan, and building a Fiat-derived compact car slightly larger than the 500 in the United States, a source told the paper. The Toluca, Mexico plant, which...

"Maybe what we should have done was not bought it," said Steve Feinberg, co-founder of hedge fund Cerberus Capital Management, in regard to his firm's ill-fated 2007, $7 billion purchase of Chrysler.

According to Democrats.com, Obama has pressured these companies into pulling their ads from FOXnews. Let's boycott these wimps and let them see that losing the mainstream dollar hurts more than losing the radical left dollar: Campbell Soup Chrysler General Motors Kellogg Kraft Foods Lawyers.com Nestle Pfizer Proctor & Gamble Progressive Insurance

WASHINGTON (Reuters) - President Barack Obama said on Wednesday that General Motors Co GM.UL and Chrysler Group were companies worth saving, but he expects both to repay their government loans. In a speech on the economy, Obama defended the decision for the government to extend GM and Chrysler roughly $64 billion in direct aid and facilitate their bankruptcies this spring. "If GM and Chrysler were willing to do what was necessary to make themselves competitive and if taxpayers were repaid every dime they put on the line, it was a process worth supporting," Obama said in Raleigh, North Carolina. "We...

WASHINGTON (AP) -- The head of the White House's auto task force is warning Congress against a House-approved plan to restore General Motors and Chrysler dealerships being closed by the car companies' bankruptcies.

The House passed a Treasury appropriations bill last week that includes an amendment reversing President Obama on the closure of nearly 800 Chrysler car dealerships and more than 2,000 GM dealerships. The amendment sponsor was Republican Steve LaTourette of Ohio. 215 Democrats and 4 Republicans voted for the overall package. Bipartisanship! The most snort-worthy reaction from the White House: The White House said Wednesday it strongly opposes the measure, arguing it would “set a dangerous precedent, potentially raising legal concerns, to intervene in a closed judicial bankruptcy proceeding on behalf of one particular group.”

It seems Obama's star power is fading rapidly. The Treasury Appropriations bill was passed 219-209 yesterday in the House. The roll call shows that the 219 is 215 dems and 4 pubs. Tucked away in the bill is a provision that is a bit of extortion: No money can be used to obtain a financial ownership in any car manufacturer if that manufacturer deprives a car dealer of its economic right under its dealer agreement.

WASHINGTON (AP) -- A House committee asked the Obama administration Friday to release documents on the federal bailouts of General Motors Co. and Chrysler Group LLC, seeking more details on decisions that led to the auto industry bankruptcies. "They negotiated, they reviewed and they approved every aspect of the Chrysler and General Motors reorganization," Rep. Spencer Bachus, R-Ala., said of the White House. "We don't know how the president's auto task force reached its conclusion." The resolution, proposed by House Republican Leader John Boehner, R-Ohio, underscored lingering resentment in Congress over the government's work to push GM and Chrysler into...

WASHINGTON - A spending bill passed by the U.S. House would force General Motors and Chrysler to restore franchise agreements with approximately 3,000 dealerships. Dealers across the country were cut loose as part of restructuring plans approved by bankruptcy courts. Meanwhile, the House Financial Services committee is seeking documents from the Obama administration on the "bailouts of General Motors and Chrysler.” Lawmakers have questions about how the President's auto task force reached its decisions to send the auto companies into bankruptcy.

Chrysler is building cars again. The problem is, they're the same cars Chrysler was building before it collapsed. Many of these -- like the Sebring and Avenger -- have been obviously uncompetitive for years. Others -- like the PT Cruiser -- are completely out of date. (The PT's basic chassis dates back to the 1990s-era Dodge Neon.) Thousands of them, built pre-bankruptcy, remain sitting on storage lots all around the country. Yet Chrysler is cranking up to build more of them. And the government is paying Chrysler to do this. More accurately, the American taxpayer is providing the financing to...

Almost every bankruptcy expert The Am Law Daily talks to agrees that the super-fast General Motors and Chrysler bankruptcies diverted from traditional bankruptcy law because of the government's huge role in each case and the danger liquidation might have posed to the broader economy. What they don't agree on is whether the cases set a meaningful precedent for future judges. "What happened in GM and Chrysler is so outrageous and so illegal that until March of this year, nobody even conceptualized it," says Lynn LoPucki, a bankruptcy expert at UCLA Law School. "Wouldn't almost every company like to get out...

There is a groundswell of disdain for the federal bailouts of General Motors and Chrysler, even as polls show that a growing "Buy American" sentiment is boosting sales for the only Detroit automaker that avoided bankruptcy and federal rescue - Ford. GM and Chrysler say some buyers are coming back to support them, even trading in their Mercedes for Chevrolets. But it is bailout opponents who are the most visible - and audible. Conservatives thunder that the country has taken a socialist route with President Obama at the wheel. "I won't buy a socialist car," columnist and radio talk-show host...

Chrysler Group LLC, which emerged from bankruptcy last month by selling most of its assets to a company led by Italy's Fiat Spa (FIA.MI), completed its board of directors with the appointment of five new members on Sunday. The Fiat tie-up was a key step in the Italian carmaker's ambitious plan to create a global player to ride out the worldwide auto sales downturn. In addition to Fiat, Chrysler Group LLC is owned by a union-aligned trust and the U.S. and Canadian governments in taking over the best parts of Chrysler. The automaker's nine-member board has three directors appointed by...

U.S. sales at Ford and Chrysler last month offered sharply different views on the downtrodden U.S. market for cars and trucks, while General Motors Corp. held its own even though it entered bankruptcy protection.

Bankruptcy experts Mark Roe and David Skeel, law professors at Harvard and the University of Pennsylvania, have written a paper assessing the Chrysler bankruptcy—very negatively. It hasn’t been published yet, but it’s available here to Social Science Research Network subscribers; I’m working off an emailed copy. [snip] Roe and Skeel note that the bankruptcy judge didn’t use—or even mention—the ordinary requirements of creditor priority in § 1129 of the bankruptcy code. “The requirement in § 1129 (a)(8) tghat each class of creditors consent or receive full payment wasn’t used. A market test wasn’t used. There was no judicial valuation of...

"They're on you day and night. Their oversight is just too extreme," said former Chrysler CEO Lee Iacocca.

Today, Rep. Jim Sensenbrenner, R-Wis., the top Republican on the Judiciary Committee, wrote Atty. Gen. Eric Holder to ask if bailed-out, taxpayer-owned carmakers General Motors and Chrysler are breaking any laws by continuing to lobby the federal government while owned by the federal government, Sensenbrenner's office has told me. Specifically, Sensenbrenner singled out GM's and Chrysler's membership in the U.S. Climate Action Partnership, a coalition of Fortune 500 companies and environmental non-profits dedicated to lobbying for federal restrictions on greenhouse gas--specifically, the sort of cap-and-trade scheme at the heart of the Waxman-Markey bill currently before the House. A quote from...

Several weeks ago President Obama pilloried holders of Chrysler debt who refused to take a deal for less than they had expected as secured creditors of the company, famously dismissing them as "a small group of speculators." Bloomberg reported that he also questioned their motives, saying that, "A group of investment firms and hedge funds decided to hold out for the prospect of an unjustified taxpayer-funded bailout." Among other things, Obama tried to cast the conflict as a moral issue, in effect suggesting that bondholders were greedy and threatening the jobs of hardworking Americans with unfair demands and a lack...

Please FReep This Poll.

Jim Press, Chrysler's charismatic deputy chief executive, went to Capitol Hill last week and spoke solemnly about the "very difficult decision" of terminating 789 of the automaker's dealers across the country. He assured members of a House committee that the company's executives had "taken every step to make this a soft landing for the dealers involved" and promised to help them as much as possible. *snip* "You have two choices," Press told the group, according to reports. "You can either help us or burn us all down." Many dealers would long remember the warning that followed to those who refused...

In assessing Team Obama’s semi-nationalization of the auto industry, a slight alteration of the famous verse by Elizabeth Barrett Browning encapsulates my reaction: “How do I [not] love thee? Let me count the ways.” 1) The government takeover is unconstitutional. The Constitution authorizes Uncle Sam to “regulate commerce,” not to own and manage it. Even before the formal coup, Obama had already fired GM’s former CEO. Now, Team Obama intends to dictate to GM what kinds of cars it must build. Of course, the federal government is already well on its way to nationalizing the financial industry, the home mortgage...