Chrysler Group CEO Tom LaSorda travelled to DaimlerChrysler's headquarters in Stuttgart, Germany, last Wednesday to present a restructuring plan to the company's management board. The Detroit News reports that the plan will involve job cuts and and the closing of at least two plants in the U.S. The plan will be reviewed by the DCX management board and likely announced in February when the company reveals its performance numbers for 2006, which analysts expect to be billions in the red.
Just like Ford with its Way Forward restructuring plan, Chrysler needs to trim down the production side of its business to meet lower demand for its vehicles that led to a loss of $1.5 billion in Q3 of 2006. In addition to shrinking its production capacity, any analyst will tell you that Chrysler also needs more small cars in its lineup, which at the moment is overrun with trucks, minivans and SUVs.
Though the Chrysler Group is still run by Tom LaSorda, many are speculating that Dieter Zetsche wants to bring back his guy pal Wolfgang Bernhard, current head of the Volkswagen brand, to run the stumbling automaker. Other initiatives that are already happening include bringing in executives from Mercedes-Benz to the Chrysler Group reduce the cost of each vehicle it produces by $1,000. Clearly DaimlerChrysler is putting effort into fixing what's broken at the Chrysler Group, though some analysts speculate that the restructuring plan announced in February will be its last attempt before selling off the automaker it had "merged" with back in 1998.
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Reader Comments (Page 1 of 1)
Greg @ Dec 26th 2006 2:21PM
''The President of the United States of America'' is the real problem for Chrysler - Ford - General Motors... Period.
When the Bush Administration took office, the value of the Euro Dollar was around 70 cents compared to the US Dollar.... Today, the Euro Dollar is now around $1.30 compared to the US Dollar. This is one of the main reasons oil is so expensive right now, the US Dollar is WEAK.
When the Bush Administration took office, their cry was the lack of 'Gasoline Refineries'... well with a Republican controlled House and Senate... and a Republican President... how many new refineries have been built versus how many merged and closed down?
So here we are.... 6 years later and gasoline is $2.55 a gallon in my town, home heating oil is well over 2 bucks... Natural gas prices have surged.... the price of Beef and Poultry are at least Double... health care costs have doubled..... I can go on and on and on.
The average American Family is choking on all ends.... and now what.. the US Auto Industry is CHOKING.... what needs to be done by the Auto Industry is the following.....
Address to the American People... remind them that 20 years ago, when someone bought a new car, they were able to use the Sales Tax they paid on that car and write it off on their taxes. This needs to be re-instated.
Address to the American People.... healthcare is a basic right for all of their workers, but the costs are choking them... and congress needs to address the price gouging that has been taking place under the Bush Administration.... also --- MEDICINE... it is absolutely ABSURD... the profit margins the global pharmacutical companies are making on the backs of US Consumers.
The US Auto Industry needs to take these two issues, plus others I am sure that are facing them... and take them to the people.... it is time for real leadership and real straight talk from the leaders of these corporations to address the problems that are facing them.. because their problems really effect most average American Families.
And to all of you out there who feel that a free market should bear its fruit in the drug industry, listen up..... GLAXO SMITH KLINE.... has been ripping off MEDICARE AND MEDICAID for years... has paid HUNDREDS OF MILLIONS OF DOLLARS IN FINES.... for RIPPING OFF THE TAX PAYERS OF THE UNITED STATES OF AMERICA.. they are a global outfit that has zero Allegience to the United States of America and it's citizens.
Anyone with the slightest gift of Visionary see's third world status for the Average American Family in the next Generation is issues like these are not addressed.
Simple Trickle Down Economics...
Think of it this way.... if the average company didn't have to pay $400 - $600 a month per employee for health insurance, that money could actually go to the worker,, and wow,... that just might help for a car payment... and a car payment equals a sale of an Automobile... doesn't it?
jon.... @ Dec 26th 2006 8:21PM
wow someone has been drinking spiked koolaid.....talk about a angry nonsenical rant.
Frank @ Dec 26th 2006 8:30PM
This is autoblog, not a political blog, especially not a "Bush is bad, Bush is evil, Bush is (fill in the blank) blog.
But since you brought it up, the alternative (Democrats) would resort to protectionism and close our market to import cars (yes a lot are still imported), raising the price of all cars and trucks in the US. That's not an answer either.
I think it's time to consider an alternative to the income tax. when you consider all the $ the government takes out of our paychecks and all the hidden taxes we pay whenever we buy something we should look at alternatives like the Fair Tax. You should visit their site www.fairtax.org to see what it's about. Of course some of you will post to say it's a bad idea even though you've never looked at the proposal (and reading a article or column about it is NOT looking at what they are proposing).
Greg is an Idiot @ Dec 26th 2006 11:27PM
It's clear that Greg has a mental disorder and some major emotional issues. President Bush came into office in January 2001. The euro didn't go into circulation until January 2002. There. All of Greg's rants were a waste of time.
Howard Kerr @ Dec 27th 2006 7:20AM
Well...to get back to cars (and trucks).
Chrysler needs more small cars???????
You mean they got it wrong with all their mini SUVs?
I came close once or twice to buying a Neon 2 door with a manual transmission and/or their ACR package. Then Chrysler decided that they didn't need a small 2 door car anymore (so what if nearly 1/4 of Neons sold were 2 doors). And with the 2nd gen. they decided to chase the rental car market and produced nearly all Neons with a doofy 3 speed automatic. For crying out loud, a 3 speed auto when even the cheapest Korean car has a 4 speed.
Other manufacturers (Ford and GM, for example) treat small cars as cheap/entry level vehicles while Chrysler styles their's as cheap/entry level SUVs. Give them credit for being somewhat different, but how about a small car in the vein of the Neon? Perhaps with retro styling cues...or not?
$0.02 @ Dec 27th 2006 8:59AM
Cut and run, baby! It's just a matter of time.
Mike @ Jan 4th 2007 3:53PM
The first comment raises some good points. High gas prices have contributed to the decline in domestic auto sales; however, the argument is not to build more refineries, its to use less fuel. Western mass consumption and waste is not sustainable. Some have estimated the true fair market value of gas to be as much as 10X the price American's pay. If America is a free market, why do they subsidize gas prices indirectly through other forms of taxation and by means of keeping oil flowing from other countries?