Monday, August 31, 2009

United Way to get $525,000 from Chrysler PAC

Money in Chrysler's dormant political action committee fund totaling $525,000 will be donated to the United Way, The Detroit News has learned.
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Friday, August 28, 2009

Chrysler may be ending partnership in Dundee | Detroit Free Press |

Chrysler Group LLC has removed logos of Hyundai and Mitsubishi from the entrance of the Global Engine Manufacturing Alliance plant in Dundee, in an apparent move to end the four-year-old partnership and take full control of the factory.

Chrysler spokesmen declined to confirm that the partners' logos were removed or that the partnership is being dissolved. Hyundai and Mitsubishi also had no comment. But employees at the plant, who asked not to be named, said Chrysler executives have communicated their intent to end the alliance.
Chrysler may be ending partnership in Dundee | Detroit Free Press |

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Thursday, August 27, 2009

Chrysler absent from buzz on electric cars

Among Chrysler Group's toughest challenges in life after bankruptcy is changing the perception that it lags competitors in bringing affordable small or midsize hybrid electric vehicles to market.

Last September, Chrysler said the first of its battery-powered ENVI models, which contain a small gasoline engine, would reach showrooms by the end of 2010. Three other electric vehicles were to be introduced by 2013.

But today, it is unclear whether new CEO Sergio Marchionne, who has been actively revamping Chrysler's product plans, remains committed to that plan. Fiat, like many European automakers, including Chrysler's former owner, Daimler AG, has been more committed to diesels than hybrids or electric models....More

Big 3 sales fade as 'clunkers' wraps up

Low inventories cited in sinking U.S. share of incentive program

David Shepardson / Detroit News Washington Bureau

Washington -- The Detroit Three automakers' share of "cash for clunkers" sales fell sharply, compared to foreign nameplates, in the final week of the $3 billion incentive program.

General Motors Co., Ford Motor Co. and Chrysler Group LLC sold 38.6 percent, or about 266,000 of the nearly 700,000 clunker replacements. That's far below their combined 45.3 percent share of 2009 auto sales.

The U.S.-based companies said they were hampered by a comparative shortage of small, fuel-efficient vehicles that buyers were seeking and that the Asian automakers provided....Freep--More

Marchionne makes himself at home with new condo

Sergio Marchionne is a man with two jobs and now two homes on two continents.

The chief executive officer of Chrysler Group LLC in Auburn Hills and Fiat SpA in Turin, Italy, has purchased a condo in Metro Detroit, where he is spending a lot of time restructuring the ailing U.S. automaker.

Purchasing a place to call home in Birmingham can be seen as a commitment to the area as well as to the automaker, which was not the case with the last man whose job it was to turn Chrysler around.

Marchionne "needs to be visible," said David Cole, chairman of the Center for Automotive Research in Ann Arbor. "If he's going to be CEO, he needs to be here."

Nissan, Chrysler cancel deal | The Detroit News

Nissan Motor Co. and Chrysler Group LLC have dropped their plans to produce vehicles for each other.

The two automakers agreed early last year to pool their volumes in the full-size pickup and subcompact segments, but doubts about the projects arose after Chrysler teamed up with Italy's Fiat SpA.

"For the past several months, teams from both companies have been studying the viability of the projects in light of significant changes in business conditions since the projects were announced," the two automakers said in a joint statement.


"Today, it was decided it was in the best interests of both companies to end the projects."

Last year, before Chrysler joined forces with Fiat, it agreed to produce a full-size pickup for Nissan, while the Japanese automaker agreed to make two subcompacts for Chrysler.

But Fiat, a small car specialist, will provide Chrysler with small-car underpinnings and sell at least one of its own cars, the 500, in the United States.

Nissan, Chrysler cancel deal | | The Detroit News

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Wednesday, August 26, 2009

Sterling Heights may be leased from New Chrysler

(Bloomberg) -- Chrysler Group LLC, the U.S. automaker Fiat SpA controls, may delay closing the plant that makes its mid-size sedans for at least a year until the company creates new models, people familiar with the situation said.

The factory in Sterling Heights, Michigan, may be leased from Old Carco LLC, Chrysler’s predecessor now in bankruptcy, to keep making the Dodge Avenger and Chrysler Sebring after a production accord ends next year, said three people, who declined to be named because the matter isn’t final.

The potential delay reflects the difficulty the combined company faces in retooling existing factories and making new models. The plant is the only Chrysler site that manufactures - mid-size sedans, and the company hasn’t said whether it will shift production or phase out Avenger and Sebring.
Chrysler Said to Consider Keeping Plant Open for Mid-Size Cars -

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Monday, August 24, 2009

Fiat 500 to test Chrysler

Chrysler Canada Inc. plans to begin selling the Fiat 500 subcompact in early 2011, providing an early test of how the alliance between the two auto makers will address the most glaring problem at the No. 3 Detroit company: the collapse in sales of its passenger cars.
Fiat 500 to test Chrysler - The Globe and Mail

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Friday, August 21, 2009

Jim Press To Leave Chrysler

DETROIT -- Chrysler Group LLC Deputy Chief Executive Jim Press is planning to leave the auto maker before the end of the year, according to three people who have been informed of the plan.

Mr. Press, a former star at Toyota Motor Corp., was the sole member of Chrysler's top executive ranks to be retained after the company emerged from a federally funded bankruptcy in June. He was kept on as a special adviser to Sergio Marchionne, who now serves as CEO of both Chrysler and its partner, Fiat SpA.

.Mr. Press, 62 years old, is expected to leave Chrysler by the end of November, according to one of the people informed of the plan.

Chrysler spokesman Gualberto Ranieri declined to comment. A spokeswoman for the U.S. Treasury, which brokered the Fiat alliance as part of the government's bailout of Chrysler, also declined comment.

Wednesday, August 19, 2009

Chrysler's Creditors Sue Daimler Over Transfers Before 2007 Sale

David McLaughlin

Chrysler's creditors say German auto maker Daimler AG intentionally defrauded them through a restructuring of Chrysler on the eve of its 2007 sale.

In a new lawsuit filed against Daimler, the creditors offer new details about their claims that Daimler stripped Chrysler of billions of dollars in assets for its own benefit before unloading the struggling U.S. auto maker.

"These exchanges enriched Daimler at the expense of the many Chrysler creditors who now are unable to look to these assets to satisfy their claims," the creditors said in the complaint.

The lawsuit, filed with the U.S. Bankruptcy Court in Manhattan Monday, comes after a judge ruled last Thursday that committee representing Chrysler's unsecured creditors could sue Daimler in an effort to increase their recovery from Chrysler's bankruptcy case.

A Daimler spokeswoman, Julia Engelhardt, said the claims in the lawsuit "are without merit."

"We will vigorously defend ourselves against these claims, which we believe are completely baseless," she said.

Creditors say that in early 2007, as Chrysler struggled under a heavy debt load and falling auto sales, Daimler faced the risk that it could be on the hook for billions of dollars in Chrysler obligations, including $17.5 billion for retiree health benefits and $5 billion in unfunded pension costs.

To avoid this risk, Daimler decided to unload Chrysler, which it bought in 1998. But before doing that, creditors say, it orchestrated the restructuring plan in the spring of 2007.

Under the plan, Daimler transferred valuable Chrysler assets to other Daimler-controlled entities. It also left assets in the group of Chrysler companies but separated them so they were no longer subject to claims from creditors, making them more valuable.

The lawsuit says the "most egregious" of these steps came when Daimler transferred Chrysler's most valuable business - its U.S. and Canadian financing subsidiaries - to a new Chrysler holding company.

By becoming a sister company of Chrysler rather than a subsidiary, the finance arm escaped potential creditor claims, according to the lawsuit. As a result, Daimler got a "substantially better price" for Chrysler when it sold an 80% stake to Cerberus Capital Management in 2007 for $7.4 billion.

After filing for bankruptcy in April, the bulk of Chrysler assets were sold to a new company owned by Fiat SpA, the U.S. and Canadian governments and the United Auto Workers union.

Besides Daimler, the lawsuit names four former members of Chrysler's board of directors. The complaint seeks unspecified damages.

Lawyers for the creditors committee say any proceeds from the lawsuit would go to paying off creditors, a group that includes the U.S. government and secured lenders that received $2 billion from the bankruptcy sale, giving them a recovery of about 29 cents on the dollar.

Monday, August 17, 2009

Chrysler to make Fiat in Mexico: report

NEW YORK (Reuters) - 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 currently makes the Dodge Journey crossover and PT Cruiser, is an attractive home for the 500 because cars could be exported to South and Central America where the Fiat brand is popular, the Journal reported.

Fiat acquired a 20 percent stake in Chrysler and entered into agreements to give it access to Fiat technology and platforms. Chrysler filed for bankruptcy in April.

Chrysler representatives were not immediately available for comment

Friday, August 7, 2009

Fiat to takeover historic carmaker Bertone to design future cars for Chrysler

MILAN (AP) — The Italian automaker Fiat on Thursday won a bid to take over the bankrupt Italian car company Bertone, which will help design cars for the U.S. automaker Chrysler, the Italian Economic Development Ministry said.

Fiat, which owns a controlling stake in Chrysler, has pledged to invest euro150 million over the next three years in Bertone, representing the best offer for investors, the ministry said.

Bertone has specialized designing cars over its 97-year history for such brands as Fiat, Ferrari, Alfa Romeo and Lamborghini.

"The sale to Fiat guarantees the future of a historic Piemontese company. In fact, the plan foresees the reabsorption of 1,137 workers, who will be gradually reinserted into their jobs, and the integration with Chrysler for the production in Italy of some models for the American auto company," Economic Development Minister Claudio Scajola said in a statement.

Fiat took a 20-percent controlling stake in Chrysler in June, and its CEO Sergio Marchionne is running both automakers. The deal was based on the transfer to Chrysler of clean-engine and small-car technology, but Marchionne has recently said that he underestimated the value of Chrysler technology, knowledge and platforms for Fiat.

Among the models designed by Bertone are the Opel Astra, Alfa Romeo 2600 Sprint, the Fiat Punto Cabriolet and the BMW Garmisch 2200Ti, the forerunner of the BMW 5-series.

Bertone filed for bankruptcy protection in 2007, and stayed away from the Geneva Auto Show last year for the first time in more than 50 years due to its financial constraints.