• Sep 8, 2008

It's not getting any easier to be a Chrysler-Dodge-Jeep dealer. Last month, when Chrysler Financial asked banks and investors to renew their $30 billion line of credit, they came up about $6 billion short. To make matters worse, the investors forced the automaker to follow much tighter financial guidelines (including a requirement to get out of leasing). Now, the cash shortfall is forcing the financial division to significantly turn up the heat on their retailers. Over the next few months, the financial arm will jack up dealer floorplan interest rates, and levy hefty fees for vehicles that sit unsold on dealer lots. With sales way down (in August, Chrysler's sales fell a sickening 34.5 percent -- the steepest decline of any major manufacturer), cash-strapped dealers are obviously unhappy with the news. Many fear this may signal the start of a new retailer initiative to limit vehicle inventory, hurting sales even further. As expected in this industry, bad news for retailers often means good news for consumers. With the new fees on the horizon, dealers will be offering significant incentives to dump inventory over the next few months.

[Source: Automotive News, subs. req'd]



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  • 9 Comments
      • 6 Years Ago
      If you want a smaller dealer network and you don't have the cash to buy them out, force them out! It's the American way.
      • 6 Years Ago
      Poor dealers, they have nothing to sell and yet they are the ones who take the hit.

      What Chrysler needs to do it to IMMEDIATELY redesign Caliber, make that interior better, add great audio system, MP3, Blootooth for free, and a NAV that is very very affordable.

      You got to make that interior look better, just copy what Honda does. Try to make this car more efficient, do as much as you can to squeez a few more MPGs, outfit the car with Run Flat tires, get rid of the spare tire. Offer very affordable Auto Tranny and offer lots of freebies, but go to the extreme with that, meaning free MyGig or Free NAV or Free Sun Roof or bigger wheels. Make people want the car.


      This car is a carbon copy of Saturn Astra, looks good on the outside, inside is C R A P , not fuel efficient at all, with super cheap interior. Get this, Chrysler gives you a 2.0 Liter engine over 1.8L for just $150, but charges people $1,000 for Auto Tranny.

      Cut the price of the automatic to $600. Undercut the competition because to be honest competition doesn't have much.

      If Chrysler can improve this vehicle by the end of the year, they will have WHOLE of 2009 with GM and Ford offering no a single decent small vehicle. In 2010 GM will have Cruze, so NOW is time to act.
        • 6 Years Ago
        By the end of the year? Either you're joking or you're totally clueless about how much in resources - both time and money, neither of which Chrysler has a lot of - it takes to do an interior redesign.

        BTW, Chrysler's new interior redesigns are trickling out. They look better but they're still crappily assembled.
      • 6 Years Ago
      I currently own a 2007 PT Cruiser-Touring. I previously had a 2002. The fit and finish for the most part is pretty good. Have had no major problems with the car and would recommend it. I would like to see if they could improve the mpg. My drive to work is about 75 miles a day round trip. It's a combination of local and highway. Avg mpg is about 26 mpg. with a 5 speed.
      • 6 Years Ago
      It's already too late to do that. By the years end? Are you kidding? Do you know how much resources it will take for them to do that? They are "hopefully" allocating some of their design resources to their new Organic designs while trying to "also hopefully" play smart and are currently working with what they have in their existing line.

      Remember it does not take months to fix issues and make cars look better, it usually takes many years in planning, unless you want another poorly laid out slapped together POS.
        • 6 Years Ago
        This comment was for "No Welfare for GM"
      • 6 Years Ago
      We would like to thank for coming world premiere Cherysler Rising Eastward Facing Peasant For Great Leap Forward C.

      Car made in Fujin in collaboration with our slaves, uh, workers at People's Glorious Plant no 5. Save weight by shoddier than even before workmanship and paying worker very low wage.

      Chrysler 5yrs. Tops.
      • 6 Years Ago
      Hmmmmm, Where theres smoke, there is fire! Where there is Bob Nardelli, there is ___________! You fill in the blanks.
      • 6 Years Ago
      What Chrysler is trying to do is change the dealer dynamic to favor selling more cars at less profit per car. When "flooring" (that is, having the car on the lot) costs are low, dealers have incentive to sell 10 cars for $1,000 profit each rather than hassle selling 20 cars for $500 profit each (which is tougher on dealers -- there just aren't as many customers out there). Chrysler, though, makes basically the same amount of money per car sold, so they obviously want the dealer to sell 20.

      When the factories are operating near optimal capacity, the "old" plan is fine -- everyone benefits -- but now, with production numbers low, Chrysler has to prod the dealers.