Allpar Forums banner

41 - 60 of 114 Posts

·
Registered
2014 Jeep Compass
Joined
·
421 Posts
Now ask yourself "Why did Daimler take over?"
Answer: Because independent Chrysler made money and had large cash reserves.
Now ask yourself "Why did Fiat come into the picture after 2008?"
Two reasons: 1) the economy failed and, despite strong new products, Chrysler was in financial trouble. However despite that Chrysler group had a new, hip image. 2) Chrysler Group, at the time, had paid too little attention to the products needed to carry through a high fuel price/poor economic conditions (gee that sounds familiar, a lineup too reliant on inefficient vehicles). Only the large cars and pickups were properly focused on. They omitted large segments that no one thought were crucial at the time. Cash for clunkers bypassed the vast majority of the Chrysler group vehicles..
Again, we are back to good business. If Tavares has too many brands to personally manage - delegate. Making excuses for doing nothing for years is a poor plan. That was FCA's MO the past several years, I hope it's not Stellantis'.
Other's make excuses for Fiat.
Other's say good business is a month and a half of a just recently finished merger with no product unveiled yet besides what came from pre-merger greenlights that the other side had no true say in.
 

·
Registered
Joined
·
1,510 Posts
Now ask yourself "Why did Daimler take over?"
Answer: Because independent Chrysler made money and had large cash reserves.
Now ask yourself "Why did Fiat come into the picture after 2008?"
Two reasons: 1) the economy failed and, despite strong new products, Chrysler was in financial trouble. However despite that Chrysler group had a new, hip image. 2) Chrysler Group, at the time, had paid too little attention to the products needed to carry through a high fuel price/poor economic conditions (gee that sounds familiar, a lineup too reliant on inefficient vehicles). Only the large cars and pickups were properly focused on. They omitted large segments that no one thought were crucial at the time. Cash for clunkers bypassed the vast majority of the Chrysler group vehicles..
Again, we are back to good business. If Tavares has too many brands to personally manage - delegate. Making excuses for doing nothing for years is a poor plan. That was FCA's MO the past several years, I hope it's not Stellantis'.
It is quite clear why 2009 happened.

What isn't as clear is why the management in 1998 didn't do what the management in 1987 did. When you are flush with cash you should be the one buying someone else. Chrysler should have bought Mitsubishi and Hyundai, not sold itself to Mercedes.
 

·
Registered
Joined
·
1,447 Posts
Bob Lutz and steve miller (cfo) tried to sell a temporarily cash rich chrysler to fiat group. Why? Because they knew Chrysler financial health was necessarily temporary: right until the next brutal-for-manufacturing-industry usa specific recession. Gianni Agnelli said no in the end. Why? Due to bloated healthcare and pension labour costs. Lutz, iaccoca and miller knew that chrysler did not have the geographical diversity andor the scale economies to survive the next recession. The eventual sale to someone was entirely inevitable: unfortunately it was to daimler. The 2008 crisis only confirmed this structural necessity in the usa auto industry (all 3 detroit firms were thrown into existential crisis.)

Sergio repeatedly warned about forgetting that basic lesson. Ie he too like lutz and miller was playing to thw rhythm of the next usa andor global recession. The slashing of net debt by rationing a lot of further higher risk investment and annuling or delaying programs etc was not geared to put liostick on a pig for a merger....it was to at least b able to survive the next recession. Which they explicitly said in investor concalls they expected to hit around....2020! That is why they started reducing incentive spending and fleet sales dependence in 2017/18 onwards. Meanwhile italy/europe was in a eurozone debt crisis etc long recession. Marchionne could have done a merger lucrative enough for himself and the agnellis anytime: hell he nearly went for a hostile debt funded takeover of gm and layer nearly did a BIG deal with no less that vw group, said no to psa a few times before the actual stellantis deal was actually done (remember they preferred renault above psa inirially.) Ie., they were managing brands product cadence un/investment exclusively for the next recession, not wanting a repeat of any of the symptoms of the usa auto industry malaise at the onset of recessions that had repeatedly happened on cue since 1980 : over capacity, over investment, over expensive staffing, over reliance on fleet sales, on heavy incentives and sub prime lending.

That recession happened exactly when they had anticipated it albeit via covid. 2020. And they did the merger, debt free and very profitable with no layoffs or shuttering of plants etc when? 2019/2020. That trillions of dollars of money printing AND fiscal stimulus has cushioned any blow to most corporations like fca or gm or ford was not because it could not b in any good capitalist or public faith known in advance and was not bankable. Ie marchionne was manging the rhythm of fca's economy exactly as lutz miller and even eaton thought they werè doing in bona fide: manage for the deep 'stress test by reality' of the next downturn/recession. "Earn your cost of capital...OVER the full business cycle not on an occassional every 3 or 5 year lucky basis!!
 

·
Super Moderator
Joined
·
37,852 Posts
Bob Lutz and steve miller (cfo) tried to sell a temporarily cash rich chrysler to fiat group. Why? Because they knew Chrysler financial health was necessarily temporary: right until the next brutal-for-manufacturing-industry usa specific recession. Gianni Agnelli said no in the end. Why? Due to bloated healthcare and pension labour costs. Lutz, iaccoca and miller knew that chrysler did not have the geographical diversity andor the scale economies to survive the next recession. The eventual sale to someone was entirely inevitable: unfortunately it was to daimler. The 2008 crisis only confirmed this structural necessity in the usa auto industry (all 3 detroit firms were thrown into existential crisis.)

Sergio repeatedly warned about forgetting that basic lesson. Ie he too like lutz and miller was playing to thw rhythm of the next usa andor global recession. The slashing of net debt by rationing a lot of further higher risk investment and annuling or delaying programs etc was not geared to put liostick on a pig for a merger....it was to at least b able to survive the next recession. Which they explicitly said in investor concalls they expected to hit around....2020! That is why they started reducing incentive spending and fleet sales dependence in 2017/18 onwards. Meanwhile italy/europe was in a eurozone debt crisis etc long recession. Marchionne could have done a merger lucrative enough for himself and the agnellis anytime: hell he nearly went for a hostile debt funded takeover of gm and layer nearly did a BIG deal with no less that vw group, said no to psa a few times before the actual stellantis deal was actually done (remember they preferred renault above psa inirially.) Ie., they were managing brands product cadence un/investment exclusively for the next recession, not wanting a repeat of any of the symptoms of the usa auto industry malaise at the onset of recessions that had repeatedly happened on cue since 1980 : over capacity, over investment, over expensive staffing, over reliance on fleet sales, on heavy incentives and sub prime lending.

That recession happened exactly when they had anticipated it albeit via covid. 2020. And they did the merger, debt free and very profitable with no layoffs or shuttering of plants etc when? 2019/2020. That trillions of dollars of money printing AND fiscal stimulus has cushioned any blow to most corporations like fca or gm or ford was not because it could not b in any good capitalist or public faith known in advance and was not bankable. Ie marchionne was manging the rhythm of fca's economy exactly as lutz miller and even eaton thought they werè doing in bona fide: manage for the deep 'stress test by reality' of the next downturn/recession. "Earn your cost of capital...OVER the full business cycle not on an occassional every 3 or 5 year lucky basis!!
Here's the problem. 2020 was not a traditional recession.
In fact, for many it wasn't a recession at all and some segments were even nearing boom levels. Look at the US housing market. Look at US home sales - UP in 2020. You can't find appliances because demand outstripped supply. You can't find contractors to work on your house because they are booked solid. I sold my Pittsburgh house in 3 days on the market during COVID for a prce higher than I ever thought I'd get after a bidding war.
Now if you were in the travel, entertainment, or restaurant industry (among others) it was more like a depression and those segments are not recovering quickly.

If Sergio was so smart about recessions, then why did he not design a more recession proof lineup for FCA in the US? A true recession across the economy would see the greatest retraction in the segments Sergio doubled down on - muscle cars, large SUVs, luxury (and even basic) pickup trucks.
The 2008 recession showed that buyers flocked to more traditional, economical vehicles. Actually even back to sedans, if only temporarily.
 

·
Registered
Joined
·
13,692 Posts
Bob Lutz and steve miller (cfo) tried to sell a temporarily cash rich chrysler to fiat group. Why? Because they knew Chrysler financial health was necessarily temporary: right until the next brutal-for-manufacturing-industry usa specific recession. Gianni Agnelli said no in the end. Why? Due to bloated healthcare and pension labour costs. Lutz, iaccoca and miller knew that chrysler did not have the geographical diversity andor the scale economies to survive the next recession. The eventual sale to someone was entirely inevitable: unfortunately it was to daimler. The 2008 crisis only confirmed this structural necessity in the usa auto industry (all 3 detroit firms were thrown into existential crisis.)

Sergio repeatedly warned about forgetting that basic lesson. Ie he too like lutz and miller was playing to thw rhythm of the next usa andor global recession. The slashing of net debt by rationing a lot of further higher risk investment and annuling or delaying programs etc was not geared to put liostick on a pig for a merger....it was to at least b able to survive the next recession. Which they explicitly said in investor concalls they expected to hit around....2020! That is why they started reducing incentive spending and fleet sales dependence in 2017/18 onwards. Meanwhile italy/europe was in a eurozone debt crisis etc long recession. Marchionne could have done a merger lucrative enough for himself and the agnellis anytime: hell he nearly went for a hostile debt funded takeover of gm and layer nearly did a BIG deal with no less that vw group, said no to psa a few times before the actual stellantis deal was actually done (remember they preferred renault above psa inirially.) Ie., they were managing brands product cadence un/investment exclusively for the next recession, not wanting a repeat of any of the symptoms of the usa auto industry malaise at the onset of recessions that had repeatedly happened on cue since 1980 : over capacity, over investment, over expensive staffing, over reliance on fleet sales, on heavy incentives and sub prime lending.

That recession happened exactly when they had anticipated it albeit via covid. 2020. And they did the merger, debt free and very profitable with no layoffs or shuttering of plants etc when? 2019/2020. That trillions of dollars of money printing AND fiscal stimulus has cushioned any blow to most corporations like fca or gm or ford was not because it could not b in any good capitalist or public faith known in advance and was not bankable. Ie marchionne was manging the rhythm of fca's economy exactly as lutz miller and even eaton thought they werè doing in bona fide: manage for the deep 'stress test by reality' of the next downturn/recession. "Earn your cost of capital...OVER the full business cycle not on an occassional every 3 or 5 year lucky basis!!
First, fleet sales are back to over 20%. The good thing that Marchionne did has been undone. Perhaps blame Manley, but the reason is weak product lineups that have not sold at retail.

Second, the company repeated one of the biggest mistakes of the past.....too much reliance on SUVs and pickup sales. By putting all their eggs into the Jeep/Ram basket, they are vulnerable at a time of rising fuel prices. The new Grand Wagoneer may be a great vehicle, but it might be stillborn in a market that seeks fuel economy.

Third, the company never fixed another one of the biggest mistakes of the past....poor quality, reliability and customer service. Marchionne had 10 years to move the company in a positive direction on these, but he did not. Margins and the next merger were more important.

Compare a press conference with Sergio to one with Tavares. Sergio talks mostly to the financial markets. Tavares talks about running a company. It is a huge difference and details a big shift. We hope it will be positive.
 

·
Registered
Joined
·
1,236 Posts
Which again shows that the FCA platform focus was impractical. They always ended up creating a new platform out of the old one. They would do better starting fresh each time and trying to share what they can share.

Quattroporte and Ghibli were based on LX platform, but deviated sharply from it (while still sharing some actual parts and assemblies).
Compass/Renegade/500X were based on Small platform, but deviated sharply from it.
Minivan was based on CUSW, but deviated sharply from it (while still sharing quite a bit of actual hard parts and assemblies).
CUSW was based on C-EVO, but deviated sharply from it.
Grand Commander was based on CUSW, but deviated sharply from it.

I wouldn't be too surprised if the Wagoneer made some serious changes to DT... but then, I wouldn't be surprised if it didn't... those Rams are pretty plush and ride nicely.

PS> Quality will be the making or breaking of the Wagoneer, long term, IMHO. If it succeeds, I think Renegade and Compass need to quietly vanish, or Compass needs to be substantially upgraded. Then having Chrysler versions would be handy.

PPS> I wonder about the viability if they did something like this in the USA:

CHEROKEE BASED
1) Jeep Cherokee: Trailhawk version only, best engine for off-road use only
2) Chrysler Saratoga (or whatever): FWD or AWD, choice of engines, luxury appointments, smooth ride, no off-road pretensions at all
3) Dodge Monaco (or whatever): sport-tuned AWD only, most powerful possible engine (e.g. 2.0 turbo hybrid), firm and sporty ride, no off-road pretensions at all

I think that's how Peugeot works in Europe, no? And it's how Chrysler used to work, only not quite as well differentiated, because they did it all with trim and sheet metal. I'm proposing the same basic platform and architecture and mostly the same parts, but tuned for brand strengths. There's some overlap but the Jeep is the only off-road-capable model, so the Saratoga and Monaco (names solely for illustration) would have different body panels and such to slash weight. No need for incredible torsional strength, it's not going off-road. Dodge is firm-riding and sporty in feel — tuning! springs, shift patterns, computer programming handles much of that. Chrysler is softer.... like Spirit R/T vs Acclaim.
Not exactly. Chrysler also offered the best engines/powertrains and finest/newest accessories. Until the late 50's and through the 60's Chrysler had the premium version of everything. Only towards the end of the 60's did Chrysler begin sharing the technology across all brands. Plymouth and Dodge had their own motors in the 50's, Chrysler shared with Imperial and (I think) De Soto. The Chrysler/Dodges you are probably most familiar with are the 70's onward years when Chrysler really did just become a trim level for many years, in the same way Cadillac, Oldsmobile and Buick, became trim levels of Chevrolet/Pontiac. I think you are correct though, to limit models and spec to specific trims. We won't see full line Brands again so better to have each Brand offer some uniqueness specific to it.
 

·
Administrator
1974 Plymouth Valiant - 2013 Dodge Dart - 2013 Chrysler 300C
Joined
·
36,192 Posts
Not exactly. Chrysler also offered the best engines/powertrains and finest/newest accessories. Until the late 50's and through the 60's Chrysler had the premium version of everything. Only towards the end of the 60's did Chrysler begin sharing the technology across all brands. Plymouth and Dodge had their own motors in the 50's, Chrysler shared with Imperial and (I think) De Soto. The Chrysler/Dodges you are probably most familiar with are the 70's onward years when Chrysler really did just become a trim level for many years, in the same way Cadillac, Oldsmobile and Buick, became trim levels of Chevrolet/Pontiac. I think you are correct though, to limit models and spec to specific trims. We won't see full line Brands again so better to have each Brand offer some uniqueness specific to it.
I think you're off by a few years regarding when Chrysler stopped sharing engines. Yes, the Hemi was unique to Chrysler (Dodge and DeSoto did have their own Hemis), but the B engines were corporate from the start, and they replaced the Hemis. The transmissions were all shared, the bodies were all basically the same design in different lengths, axles were always shared, etc. Technology was always shared across the board when possible, e.g. electronic ignition; standard alternators started on the lowest priced cars in 1960. But that's really not arguing too much with you, it's a matter of three to five years. Newport was the first B-body Chrysler, I think - I could be wrong - and Cordoba was the first Chrysler originally meant to be a Plymouth and shared almost 100% with Dodge.

Maybe it would have worked if they'd made Dodge truck only; then they'd have Plymouth and Chrysler. But they chose in the 1960s to not have separate Plymouth dealers, after kicking the idea around a while. (They were separate before the Depression.)

Plymouth at Chrysler/Imperial dealers meant that you would not get Cadillac levels of service - you'd get Plymouth service from your Cadillac priced car. Dodge at separate dealers eventually became "Dodge has to have one of everything the corporation offers." But if the presidents had taken a hard line, combined dealerships would never have been the solution. (Actually, I could see Dodge/Plymouth dealerships. But if Chrysler was ever to be a serious upscale competitor, they could not share with Plymouth, and if Dodge was going to share with Plymouth, Chrysler could not be there either. )

The sensible approach would have been Plymouth in one dealership with Dodge trucks, and Chrysler off by itself.
 

·
Registered
Joined
·
1,510 Posts
I think you're off by a few years regarding when Chrysler stopped sharing engines. Yes, the Hemi was unique to Chrysler (Dodge and DeSoto did have their own Hemis), but the B engines were corporate from the start, and they replaced the Hemis. The transmissions were all shared, the bodies were all basically the same design in different lengths, axles were always shared, etc. Technology was always shared across the board when possible, e.g. electronic ignition; standard alternators started on the lowest priced cars in 1960. But that's really not arguing too much with you, it's a matter of three to five years. Newport was the first B-body Chrysler, I think - I could be wrong - and Cordoba was the first Chrysler originally meant to be a Plymouth and shared almost 100% with Dodge.

Maybe it would have worked if they'd made Dodge truck only; then they'd have Plymouth and Chrysler. But they chose in the 1960s to not have separate Plymouth dealers, after kicking the idea around a while. (They were separate before the Depression.)

Plymouth at Chrysler/Imperial dealers meant that you would not get Cadillac levels of service - you'd get Plymouth service from your Cadillac priced car. Dodge at separate dealers eventually became "Dodge has to have one of everything the corporation offers." But if the presidents had taken a hard line, combined dealerships would never have been the solution. (Actually, I could see Dodge/Plymouth dealerships. But if Chrysler was ever to be a serious upscale competitor, they could not share with Plymouth, and if Dodge was going to share with Plymouth, Chrysler could not be there either. )

The sensible approach would have been Plymouth in one dealership with Dodge trucks, and Chrysler off by itself.
B body started with '62 Dart/Polara/Fury/Savoy/Belvedere. Cordoba was the first B body Chrysler, and the first postwar midsize Chrysler.
C body started with '65 Polara/Monaco/Fury/Chryslers. Newport was basically a Polara with a 3" longer wheelbase.
 

·
Administrator
1974 Plymouth Valiant - 2013 Dodge Dart - 2013 Chrysler 300C
Joined
·
36,192 Posts
Good correction on Newport. Still, Newport is usually held up as the first Dodge-overlap Chrysler, due to the price point. The decision for the Cordoba made perfect sense at the time, don't get me wrong. But again, the idea that Chrysler got the best first ... I don't know where the reality point of that is, other than the Hemi V8 and ... well, not fuel injection.
 

·
Registered
Joined
·
1,510 Posts
Good correction on Newport. Still, Newport is usually held up as the first Dodge-overlap Chrysler, due to the price point. The decision for the Cordoba made perfect sense at the time, don't get me wrong. But again, the idea that Chrysler got the best first ... I don't know where the reality point of that is, other than the Hemi V8 and ... well, not fuel injection.
Anti lock brakes before Mercedes. Stuff like that.
 

·
Administrator
1974 Plymouth Valiant - 2013 Dodge Dart - 2013 Chrysler 300C
Joined
·
36,192 Posts
Anti lock brakes before Mercedes. Stuff like that.
Weren't those on Imperial when it was a separate brand?


1971 Imperial, which I think was still its own brand, though I might be wrong.

Fuel injection: 1958, launched on all brands at once.

 

·
Registered
Joined
·
13,692 Posts
I am not sure that they need to go after Mercedes, BMW and Audi.

I think those companies are caught in the middle. They are trying to reach down into the volume market and up into the luxury market.

I think there is nothing wrong with flanking them from both sides using the mass market brands on the bottom to just reach into their territory and using Maserati from the top reaching down into the top of their territory.
 

·
Registered
Joined
·
1,510 Posts
I am not sure that they need to go after Mercedes, BMW and Audi.

I think those companies are caught in the middle. They are trying to reach down into the volume market and up into the luxury market.

I think there is nothing wrong with flanking them from both sides using the mass market brands on the bottom to just reach into their territory and using Maserati from the top reaching down into the top of their territory.
They are reaching down into near luxury (premium) for CAFE reasons in the US. They always had something there in Europe. Mercedes and BMW don't have to reach up, they are up. Audi is weaker in this regard.

Yes, Chrysler should be hitting A3/A4/Q3, A/CLA/GLA/GLB and X1/X2 from below, Maserati from above. A frontal assault on Mercedes/BMW by Alfa is a suicide mission.
 

·
Administrator
1974 Plymouth Valiant - 2013 Dodge Dart - 2013 Chrysler 300C
Joined
·
36,192 Posts
I am not sure that they need to go after Mercedes, BMW and Audi.

I think those companies are caught in the middle. They are trying to reach down into the volume market and up into the luxury market.

I think there is nothing wrong with flanking them from both sides using the mass market brands on the bottom to just reach into their territory and using Maserati from the top reaching down into the top of their territory.
Exactly. Maserati is an underused resource right now. I have no idea why SM chose to resurrect Alfa when Maserati could have gone after the Mercedes S-Class. I think it's much harder to go after the BMW market. Audi is already there, for one thing. Also, while ordinary people tend to like luxury cars, they don't like truly sporty cars as much - too much work to drive. I noticed they sandpapered the Giulia's sporty edges to get the Stelvio. The Quattroporte was just a pleasure to drive. Think of a 300C or Charger or Challenger, but better in every way (other than brute force from the 392 or Hellcat).

Which leaves Alfa and Lancia with something of a roving brief. Assuming they survive.
DS with sexier names.
 

·
Registered
Joined
·
125 Posts
Exactly. Maserati is an underused resource right now. I have no idea why SM chose to resurrect Alfa when Maserati could have gone after the Mercedes S-Class. I think it's much harder to go after the BMW market. Audi is already there, for one thing. Also, while ordinary people tend to like luxury cars, they don't like truly sporty cars as much - too much work to drive. I noticed they sandpapered the Giulia's sporty edges to get the Stelvio. The Quattroporte was just a pleasure to drive. Think of a 300C or Charger or Challenger, but better in every way (other than brute force from the 392 or Hellcat).



DS with sexier names.
And where exactly does DS fit in? As far as I can see it's yet another pretend posh brand with no place to go. It's also a real insult to use DS for a brand when one recalls the superb, indeed legendary Citroen DS/ID.
 

·
Administrator
1974 Plymouth Valiant - 2013 Dodge Dart - 2013 Chrysler 300C
Joined
·
36,192 Posts
And where exactly does DS fit in? As far as I can see it's yet another pretend posh brand with no place to go. It's also a real insult to use DS for a brand when one recalls the superb, indeed legendary Citroen DS/ID.
DS exists. I would figure that DS will get a version of the Giulia and Stelvio (if that makes sense); the DS cars will be sold as Lancias in Italy, virtually unchanged; and retuned to become Alfa Romeos and possibly Chryslers. That is my guess.

Peugeot has NO problem with the old "retune, restyle, resell" system. (Nor does VW, for that matter, with Skoda, Seat, VW, and Audi).
 
41 - 60 of 114 Posts
Top