Chrysler leads Detroit 3 in Japan sales

Chrysler Group outsold Ford and General Motors in Japan last year, showing the most growth of the American automakers.

4,871 Chrysler, Dodge, Jeep and Ram vehicles were registered, compared to 3,469 Fords and 2,966 General Motors cars and trucks. Jeep was the top-selling U.S. brand for December, and was just 315 sales behind Ford for the year.

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Chrysler leads Detroit 3 in October sales gains

With a 27.0% increase in October sales, Chrysler had no trouble beating its crosstown rivals: Ford sales rose 6.2% while General Motors sales were up a scant 1.8% last month. As expected, neither Toyota nor Honda was able to match their numbers from last October but Toyota sales were strong enough to put it back in the No. 3 sales position for the month. Chrysler’s more than 165,000 sales ahead of Honda, so fourth looks pretty safe for the year.

The seasonally adjusted annualized rate (SAAR) came in at 13.26 million units, well ahead of last October’s 12.18 million and the highest reading since February of this year. A lot of industry watchers were hoping for a SAAR in the range of 13.4-13.5 million, but it wasn’t in the cards.

Chrysler was especially strong in cars sales in September; they accounted for 28.5% of all Chrysler’s sales, an unusually high number for the gang in Auburn Hills.

Chrysler minivan sales tanked last month: Of the four major players, the Caravan was third and the Town & Country was fourth. The Caravan still clings to a 975-unit lead in year-to-date sales.

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GM-UAW Contract Highlights

With more negotiations between Chrysler and the United Auto Workers still to come, the terms of the new agreement between General Motors and the UAW have been made public. The entire contract runs 422 pages, but the UAW highlighted the new benefits for its membership.

Jobs, investment and products: Spring Hill, Tennessee – two mid-size vehicles; Warren, Michigan – new transmission program; Romulus, Michigan – new engine program; Wentzville, Missouri – full shift added and new mid-size pickup program; Saginaw, Michigian – castings for next generation engine program; Fort Wayne, Indiana – next generation full-size pickup; compact vehicle at a yet-to-be determined plant. (The Shreveport, Louisiana, plant that produces GM’s mid-size pickups is still scheduled to close next year when the Colorado and Canyon are discontinued. The Janesville, Wisconsin plant remains on standby.)

• Since the bankruptcy, GM committed $4.6 billion in investment and new products creating 11,800 jobs. In this agreement, we won commitment to create or retain an additional 6,400 jobs, which is $2.5 billion of investment, including a major victory of bringing in product from Mexico. Additionally, the joint teams identifi ed 760 more potential jobs and 1,400 new jobs for UAW-represented suppliers. This will total approximately 20,000 new jobs since bankruptcy.

Pay, bonuses, benefits:

• $5,000 lump sum upon ratification for all employees.

• $1,000 Inflation Protection lump sums in 2012, 2013 and 2014.

• New annual profit-sharing program with greater transparency and a minimum payment of $3,500 in 2012 for 2011 profits based on first half reported figures.

• $250 yearly award for meeting quality targets.

• Wage increases for Entry-Level (Tier II) workers: Group B $15.78 to $19.28 at end of the agreement. (Chrysler currently pays these workers $14.89/hour)

• Unlimited $25 office visits, annual physicals, no cost increases in prescription drugs.

• SUB (Supplemental Unemployment Benefit) pay replenished.

• $10,000 bonus for eligible employees who retire in next two years. Additional $65,000 bonus for skilled trades who retire/voluntarily quit between Nov. 1 and March 31.

• Skilled trades: 1,300 new apprentices, tooling allowances increased, and return displaced skilled trades from production to their skilled trades classifications. Bidding of both exited skilled trades and janitor work when third-party contracts expire.

• Sourcing moratorium remains intact.

• Reinstated pay-in-lieu vacation provisions.

• $30,000 modified enhanced relocation, with return home rights.

• Global unions information sharing forum established.

The new contract continues to allow locals to strike over local issues, so long as the union provides five days’ notice. This is the same provision the UAW local at the GEMA plant used to authorize a strike over the rotating shifts.

UAW president Bob King has already said it is unlikely that the UAW will be able to secure an identical agreement from Chrysler. The union plans to “tweak” the terms to meet the realities at Chrysler and Ford.

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Crown Vic’s demise might not boost Charger police sales – yet

Analysis by Bill Cawthon

The Ford plant in St. Thomas, Ontario, will close next month, ending production of the Crown Victoria, the car that has been the 800-pound gorilla in police fleet sales since Chevrolet dropped the full-size Caprice after the 1996 model year. While Chevy offered the downsized Impala and Tahoe and Chrysler countered with the Intrepid and Charger Pursuit, the Crown Vic accounted for 70-80 percent of police sales year in and year out.

However, even with the Crown Vic out of the picture, it might be a while before Dodge or Chevy see many significant new orders. The reason is that law enforcement agencies are hedging their bets by ordering extra Fords. As of the end of July, Ford had sold 35,203 Crown Victorias, up 63.8% from the first seven months of 2010. For the month of July, Ford sold nearly five thousand police-only Crown Vics; that’s more sales than the Taurus, which will provide the underpinnings for the next generation of Ford cruisers. By contrast, Chevrolet sold 90 of their new, Australian-built Caprice Police Patrol Vehicle (PPV) bringing the year-to-date sales to 155 since deliveries began in May.

This isn’t new; the same thing happened when Chevrolet quit building the last Caprice. Back then, fleet buyers stocked up and there was even a factory-aided rebuild program to help law enforcement agencies keep their big Chevys on the beat a while longer.

Police Departments don’t like to have to change cars; it costs them money for new maintenance contracts or for parts for those agencies that service their own vehicles. It can also cost money to retrain maintenance staffs and, in the case of a significantly different vehicle, could even require more training for patrol officers. All at a time when government agencies are strapped for cash.

However, in time it should work out in favor of Dodge and Chevrolet. For all the advantages that Ford is touting for the new Police Interceptor, some agencies are already dismissing it. The new front-wheel-drive Taurus cop car is going up against two V8-powered, rear-wheel-drive competitors in a market that wants V8-powered, rear-wheel-drive cars. With the gap between the last deliveries of the Crown Vic and the first deliveries of the Police Interceptor, Dodge and Chevrolet will have a golden opportunity to make their cases. The Charger Pursuit has had better police sales than the current Impala, but the new Caprice PPV racked up some fairly impressive numbers in the Michigan State Police tests. The Charger Pursuit’s main strength at this point is the fact it has a track record and is in use by more fleets but Chrysler may want to see what it can do to tweak some of the Charger’s numbers

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Fiat buys stake in VM Motori

Fiat Powertrain has purchased half of VM Motori SpA, which supplies engines for some European Chrysler vehicles, from Penske.

General Motors has owned the other half of VM Motori since 2007. GM and Fiat Powertrain released a statement saying that they would jointly manage VM Motori and continue existing contracts and relationships.

VM Motori has a reputable, advanced line of diesels, in sizes that appear to complement the existing Fiat diesel lines.

GM and Fiat have worked together in the past, and both currently sell cars in Europe from a shared platform, according to globalauto.org (the SCSS B cars, including Fiat Punto, Linea, and Doblo, Alfa Mito, Opel-Vauxhall Corsa, Citroen Nemo, Peugeot Bipper, and others).

(Thanks, forum member patromigh).

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Akerson offers excuses: Marchionne offers products

News analysis by Bill Cawthon

Dan Akerson, CEO of General Motors, finally revealed a nasty little secret: GM is about a year behind in its new product development schedule. Those who have been looking behind the curtain at GM’s announcements over the past couple of years were aware that the Volt was about the only thing the General had in the hopper. The Sonic is a revamped Aveo and the “new” Cruze is new to us, but it’s old news to just about anybody else in the world. Though both are (or will be) built at GM’s Lordstown, Ohio, plant, both the Sonic and Cruze are products developed by Daewoo with some input from Opel.

The Buick Verano, released with all the hype one would expect, is a reskinned Cruze with a shiny new badge. GM’s upcoming Chevrolet Caprice Police Pursuit Vehicle is another derivative of the Holden that was last sold here as the Pontiac G8.

Akerson blames the fact that development spending was slashed during GM’s dance through the bankruptcy courts, and says the General won’t be back on target until 2012-2013.

Could it have been that, since emerging from bankruptcy, Mr Akerson’s predecessors were too busy playing musical chairs with management, and he’s been too busy trying to figure out how to get himself bigger executive bonuses while freezing pay for workers?

Maybe a trip over to Auburn Hills or a quick stop at the Chrysler exhibit would help put things in perspective. Or they might thoroughly embarrass him.

When Chrysler entered bankruptcy, it had little in the new product pipeline. Bled by Daimler and gutted by Cerberus, there weren’t even enough people to mount a credible new product development program. Chrysler was in such bad shape, the mental midgets of the financial world were suggesting it merge with GM.

In spite of this, Sergio Marchionne, his executive team and a lot of Chrysler employees put 16 substantially improved or new vehicles on the stand at this year’s North American International Auto Show. Vehicles that are finalists for North American Truck of the Year, that are getting great reviews, that, if there is any justice in the universe, will have new customers adding Chrysler, Dodge, Fiat, Jeep and Ram to their new vehicle shopping lists. We’re talking results, not excuses.

Marchionne hung out the help-wanted sign; he’s adding engineers and production shifts. 5,000 more people work at Chrysler now than did a year ago. A Chrysler plant scheduled for closure has a new lease on life.

And he’s done all this while running two car companies and dealing with unions far more hardcore than the the United Auto Workers and a government that sides with them. He shut down a plant in Sicily and made it stick. Within the US, he’s pushed quality standards higher than they’ve been in years — overcoming objections from executives used to pushing numbers and returning “stop the belt” capability to the line workers.

This, even though Akerson’s supposedly a problem-solving All-American engineer worth, according to the board of drones at GM, a $9 million compensation package including $1.7 million in cash. Marchionne’s a Canadian-Italian lawyer and all he’s gotten from Chrysler is $600,000 worth of shares he can’t even sell for three years. (Marchionne’s Fiat compensation package is about $6.5 million, including bonuses. That’s still less than packages given to Akerson and Alan Mulalley at Ford – and they’re only running one car company each).

It’s true a lot of what Chrysler is showing was pretty much in place before Marchionne entered the scene. But what’s making the difference (better interiors, better materials, refined products, and the night-and-day replacements for the Avenger and Sebring) has happened since Chrysler emerged from bankruptcy. And this is what’s new at Chrysler while so much is still the same at General Motors.

Perhaps the stark differences between GM’s product portfolio and Chrysler can be summed up by examining the true goals of the people running the show. General Motors’ goal was an initial public offering; Chrysler’s goal was a future.

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