• Sep 15, 2006
The Chrysler Group is stepping in line with Ford today, which earlier announced more buyouts for Blue Oval workers, plant closings and that it won't see a profit in North America until 2009 at the earliest, to announce that it has increased the amount it expects to lose in the third quarter by almost $1 billion to a total of $1.5 billion. Citing a laundry list of reasons mirroring those that also caught Ford by surprise, including high fuel prices, lack of a competitive small vehicle lineup and high legacy costs, Chrysler states that it will take the hit this quarter but is "striving" to achieve a profit in Q4. The automaker will have eight new vehicles out by year's end to help achieve that aim, including the new Dodge Caliber, Jeep Patriot and Compass, and Chrysler Sebring. We wish 'em the best of luck.

[Source: DaimlerChrysler]


I'm reporting this comment as:

Reported comments and users are reviewed by Autoblog staff 24 hours a day, seven days a week to determine whether they violate Community Guideline. Accounts are penalized for Community Guidelines violations and serious or repeated violations can lead to account termination.


    • 1 Second Ago
  • 24 Comments
      • 8 Years Ago
      "The automaker will have eight new vehicles out by year's end to help achieve that aim, including the new Dodge Caliber, Jeep Patriot and Compass, and Chrysler Sebring."

      Wow, that's exactly the trio I and other American consumer will be drooling over for decades to come. Good luck Chrysler indeed.
      • 8 Years Ago
      The Big 3's problem is the free trade (NAFTA) and all foreign competition tax the vehicles heavy so their countries people can't afford American made products. Just look at all the jobs that left to foreign countries for cheaper labor and they don't have to worry about the EPA in those places. It's time to go back to the old slogan "BUY AMERICAN"
      • 8 Years Ago
      Looks to me like DC is sending a message to UAW!!!!!
      • 8 Years Ago
      I believe that Honda did extend the warranty for Canadians who bought their vehicles in Canada. What they probably do not offer is any warranty--extended or otherwise--on Canadian-market vehicles bought by Americans.

      The issue here is gray market traficking in automobiles. The reason that every auto manufacturer--not just Honda--cares about borders is that they cannot adjust prices to match exchange rates because exchange rates change too often and because consumers would get upset if vehicle prices were as volatile as exchange rates. They'd have to reprint the stickers at least monthly. In terms of profits per vehicle, manufacturers tend to lose money from this system, but the general demand for price stability requires it.

      As a result, prices can be very different on different sides of the border. Right now Canadians are whining about how much cheaper most cars are in the U.S. Five years ago Americans were doing the same about Canadian prices. Frankly, the Canadians have no business whining, as in the long-run the policy benefits them. The extra they're paying now (compared to U.S. prices; nothing extra in their own currency) is much smaller than the savings they enjoyed for years (again compared to U.S. prices).

      Because manufacturers incur losses when they don't change prices with exchange rates, they want to limit the impact of this policy to the people it is intended to benefit: the people who are paid in the same currency in which the vehicle is priced. One way they do this is by refusing to honor the warranty on gray market vehicles.

      Anyone who bought one of these gray market vehicles saved a bunch of money at the time. As they say, there's no such thing as a free lunch.

      Bottom line: Honda's policy is far from unique, and it had no impact on Canadians. Instead, it affected Americans who tried an end run around the system.

      You might argue that people should be able to buy a vehicle from wherever and have the warranty honored wherever. But if this was allowed to happen freely, manufacturers would be forced to float prices with exchange rates, and the advantage would disappear. So nothing would ultimately be gained by this.
      • 8 Years Ago
      "lack of a competitive small vehicle lineup"

      Well, duh! The Dodge Caliber (and its sister's Jeep Compass and Patriot) aren't exactly "small". The car is sized between a compact and a mid-size car, and looks like a mini-minivan. They need a small car, with 4-doors, not 5.
      • 8 Years Ago
      Vie hav vays of making you buy und Compass.
      • 8 Years Ago
      I was just on the phone with Chrysler Customer Care a couple weeks ago explaining to the guy why they keep losing market share i.e. because of how they handle problems like the one I was having with my wife's car.

      His eventual line, and he said I could quote him on this: "It's not my job to use common sense. It's my job to follow company policy."

      Chrysler's cars probably do have more problems than others. But the gap in absolute terms isn't huge. The real problem is in how they handle product issues. The strategy has long been to lose a customer (perhaps for life) whenever this will save them a couple hundred bucks.

      They're not alone in this. Ford definitely has the same problem. One of my panel members recently told me that a Ford dealer made him pay for new trunk lid struts on a three-month-old Ford Five Hundred. Why? They're apparently a wear item. Risk losing a customer over $50? Sure, there are still a few more out there.

      I live near Detroit, and part of me will always root for these guys. The other part of me knows they deserve pretty much everything that comes to them. In the end the two roughly balance out.
      • 8 Years Ago
      "But if you start out tainted that the best deal is across the street then you are going to buy across the street more even when that is not the case (that it's the best deal)."

      By this I take it you mean imports get an unfairly better rep than domestic autos. Well I disagree, both out of personal experience, and out of what press reports. My dad's Chevy Malibu--all I remember was it giving him trouble. Friend's new Escape breaking down on the way home from dealership, and having poor plastic fitment issues. Family friend insisting on buying Caddies in spite of them breaking down after three to four years. Maybe they were all outliers and not the norm. But then you take JD Powers, Consumer Reports mirroring my observations, and I'm more inclined to stay away from US cars.

      "The point is if you are going to get a bad product with a nearly equally likely chance, why not support your own."

      I agree, except buying a car isn't simply about quality, it's also about taste. Now if there were two exact same cars, sure.

      Does US make nice cars? Sure they do. Do I want US automakers to succeed? I do, because better US cars means the competition have to be on their toes as well. I agree GM is producing some appealing products: Sky, Corvette to name a few (I always turn my head when seeing a Solstice). Nor am I opposed to buying a GM vehicle in the future. And I think GM is making better cars now then 5 years ago. Why? Precisely because Americans *aren't* only buying American. It forces the company to go above and beyond the negative perceptions (regardless whether they are warranted or not) and stereotypes.

      And I firmly agree with your views on the iPod. Most overpriced and hypermarketed things out there.
      • 8 Years Ago
      FOR ALL YOU ATTACKING ME FOR BUYING A FOREIGN CAR:

      1) BIG 3 NEVER had an open door hiring policy, since th e 1970's(do you call being told" Do you know someone here, works here? if the answer was no, No Job Chances at all). Tell me I am wrong, and I will KNOW YOU'RE A LIAR. just think if Krogers, ro Wal-Mart siad' Unless you knwo someone here, working here, and they bring youu an application, then you Can't apply for work here".... what kinds of %^&*( would be raised on tv by demonstrators!

      2) You hate foreign goods: Dump you cel phones, tvs, clothing, shoes, law mowers, etc( hypocrates, all of ya).

      3) I am a DAV..... I earned my right to buy what I like, how about you!?
      • 8 Years Ago
      I have already read numerous articles in the drive-by automotive press which have DCX in the grave with the coffin lid being shut. That is total propaganda and an indication of their agenda. The production cut, to eliminate inventory, is 2-3% of their annual Chrysler Division sales in the United States-hardly the tradgedy they have suggested. For Chrysler, it has been an expensive year. With more true all-new model introductions than any Japanese competitor and smart long-term investment to make their assembly plants more flexible (up to 4 model/platforms per line), their are positioning themselves for the future. All I can say is 'watch out Honda and Toyota' its on the way.
      • 8 Years Ago
      Huh? The Caliber has been out for a few months now, and I thought it was selling as fast as they could make them.
      • 8 Years Ago
      I mean think about all you ANTI-UAW people:

      Dodge is the WORSE thing you could do:

      1.) Profits are sent oversees BUT you still support the UAW people. Seems like you would aviod this company like the plague.
    • Load More Comments