Autoblog http://www.autoblog.com Autoblog http://www.blogsmithmedia.com/www.autoblog.com/media/feedlogo.gif Autoblog http://www.autoblog.com en-us Copyright 2009 Weblogs, Inc. The contents of this feed are available for non-commercial use only. Blogsmith http://www.blogsmith.com/<![CDATA[REPORT: Chrysler could lose up to 145 more dealers because they can't get financed]]>http://www.autoblog.com/2009/11/23/report-chrysler-could-lose-up-to-145-more-dealers-because-they/http://www.autoblog.com/2009/11/23/report-chrysler-could-lose-up-to-145-more-dealers-because-they/http://www.autoblog.com/2009/11/23/report-chrysler-could-lose-up-to-145-more-dealers-because-they/#commentsFiled under: ,



Chrysler's dealers haven't yet entered the portion of the game wherein they can catch a break. As if the dearth of inventory and lack of new vehicles weren't enough, nearly 150 dealers haven't been able to finalize floorplan financing. Since Chrysler Financial has exited that business, GMAC stepped in, but dealers are having a hard time meeting its terms: 85 have been turned down flat, another 60 or so are still working on it.

In some cases GMAC has asked for more collateral; in at least one other case, GMAC is looking for the dealer to alter the lending structure of his mortgages (not floorplan), held by Chrysler Financial. The former Pentastar piggy bank, again accused of trying to wind down its operations, said it "continues to cooperate" with all involved. If the rumored number of dealers does fall, it would take Chrysler's planned closures up to nearly 1,000, after the 789 announced earlier this year.

[Source: Bloomberg | Image: Mark Ralston/Getty]

REPORT: Chrysler could lose up to 145 more dealers because they can't get financed originally appeared on Autoblog on Mon, 23 Nov 2009 10:30:00 EST. Please see our terms for use of feeds.

Read | Permalink | Email this | Comments]]>chryslerchrysler dealerschrysler dealers rejectedchrysler dealershipchrysler financialChryslerDealersChryslerDealershipChryslerDealersRejectedChryslerFinancialfinancialsgmacMon, 23 Nov 2009 10:30:00 EST<![CDATA[REPORT: Chrysler Financial to wind down by 2011, executive pay, well, not so much]]>http://www.autoblog.com/2009/10/25/report-chrysler-financial-to-wind-down-by-2011-executive-pay/http://www.autoblog.com/2009/10/25/report-chrysler-financial-to-wind-down-by-2011-executive-pay/http://www.autoblog.com/2009/10/25/report-chrysler-financial-to-wind-down-by-2011-executive-pay/#commentsFiled under: ,



Cerberus submitted its plans for Chrysler Financial to the U.S. Treasury, and then in an announcement that came as a surprise to Cerberus itself, the Treasury said that Chrysler Financial would be shutting down by December 31, 2011. The lending arm paid back its $1.5 billion loan from the government's TARP program, but much of its dealer financing and loan operations were replaced by GMAC.

Even though Chrysler Financial is a far weaker business than it once was -- its loan portfolio has been more than halved -- Cerberus said that shutting it down wasn't in the long-term plan. The Treasury replied that it got the idea of closure from its talks with Cerberus and the paperwork submitted by the capital management firm. There will most likely be a lot more "They said/We said" before this is through.

What isn't in question is the fact that if you want big money in the banking biz, you should get a job or keep your job with Chrysler Financial. Severe pay reductions were announced for financial firms that hadn't paid back their loans, which means that ChrysFin is excused from those measures. As well, according to pay czar Kenneth Feinberg -- and which would appear to bolster Treasury's take on the company's future -- "the risk of employee departures must be minimized because Chrysler Financial has stated it intends to wind down its operations and will have difficulty attracting new employees."

That means that, according to government's take on Cerberus' take, the company needs to keep pay high so it can keep good people so it can close in two years. To paraphrase Captain Willard in Apocalypse Now, the BS is piling up so fast we'll need wings to stay above it. Stay tuned...

[Source: Detroit News]

REPORT: Chrysler Financial to wind down by 2011, executive pay, well, not so much originally appeared on Autoblog on Sun, 25 Oct 2009 09:27:00 EST. Please see our terms for use of feeds.

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According to a variety of reports, Chrysler Financial has reimbursed the $1.5 billion it was loaned on January 16 through the Treasury Department's Troubled Asset Relief Program (TARP) - making Chrysler's financial arm the first auto-sector company to pay back its government loans.

Chrysler Financial says it used the funding to provide more thatn 85,000 consumer loans for vehicle purchases and said the quick pay-off was due to provisions contained withn the loan that would increase costs over time.

Although Chrysler Financial is still offering insurance and financial products to consumers at dealerships, GMAC Financial Services replaced Chrysler Financial as the automaker's preferred lender when the Pentastar people filed for Chapter 11 earlier this year.

[Source: Reuters]

REPORT: Chrysler Financial repays $1.5B in government loans originally appeared on Autoblog on Tue, 14 Jul 2009 17:34:00 EST. Please see our terms for use of feeds.

Read | Permalink | Email this | Comments]]>chrysler financialchrysler repays loanChryslerFinancialChryslerRepaysLoantarptroubled asset relief programTroubledAssetReliefProgramTue, 14 Jul 2009 17:34:00 EST<![CDATA[Autoblog Podcast #124]]>http://www.autoblog.com/2009/04/22/autoblog-podcast-124/http://www.autoblog.com/2009/04/22/autoblog-podcast-124/http://www.autoblog.com/2009/04/22/autoblog-podcast-124/#commentsFiled under: , , , , , , ,


Click above for the Autoblog Podcast in iTunes, RSS or listen now!

Chris, Sam and Dan kick it again for Episode #124 of the Autoblog Podcast. This time, we touch on Toyota's competitive Prius price posturing, the Shanghai Motor Show, where Chinese automakers are finding their design footing, and Chrysler Financial's flap over executive compensation and government money. Some good questions from listeners landed in our inbox, so we hit on those, too, before wrapping it up. Thanks for listening, check out our Twitter feed, and don't forget our Podcast at autoblog dot com address for your feedback.

Follow the jump to subscribe to the Autoblog Podcast in iTunes, add the show to your RSS aggregator... or listen to it right now!

Continue reading Autoblog Podcast #124

Autoblog Podcast #124 originally appeared on Autoblog on Wed, 22 Apr 2009 16:15:00 EST. Please see our terms for use of feeds.

Read | Permalink | Email this | Comments]]>autoblog podcastAutoblogPodcastchrysler bailoutchrysler financialChryslerBailoutChryslerFinancialfeaturedpodcast 124Podcast124shanghai 2009shanghai auto showshanghai motor showShanghai2009ShanghaiAutoShowShanghaiMotorShowtoyota priustoyota prius hybridtoyota prius pricetoyota prius pricingToyotaPriusToyotaPriusHybridToyotaPriusPriceToyotaPriusPricingWed, 22 Apr 2009 16:15:00 ESTAutoblog Podcast #124Autoblog76:00<![CDATA[REPORT: Unsigned waivers to blame for Chrysler Financial rejection of gov't cash]]>http://www.autoblog.com/2009/04/21/report-unsigned-waivers-to-blame-for-chrysler-financial-rejecti/http://www.autoblog.com/2009/04/21/report-unsigned-waivers-to-blame-for-chrysler-financial-rejecti/http://www.autoblog.com/2009/04/21/report-unsigned-waivers-to-blame-for-chrysler-financial-rejecti/#commentsFiled under: , ,



Over the past two days, we've told you what we've heard about the latest short-term federal aid coming to Chrysler and GM. According to the latest reports, it will be $5B to the latter and $500M to the former. We also mentioned it had been reported that Chrysler Financial had inexplicably turned down an additional $750M in government aid during this most recent round of handouts. It had been speculated that it was because of a refusal by CF execs to sign off on executive compensation limits in the terms of the government agreement.

Although CF denied it, the fact that they appeared to be going elsewhere for additional loan money seemed to confirm that they might not have been entirely happy with the terms of the government handout. Well, The Detroit Free Press is now reporting that a recently released report by the special inspector general's office confirms that unsigned waivers were the real reason behind the rejection. The Freep is reporting that at least some of the top 25 executives at CF "refused to sign waivers releasing the Treasury Department and the company from legal responsibility for placing strict limits on executive compensation."

Even without the three-quarter-billion-dollar handout to CF, a total of $13.4B has been given to GM and Chrysler out off the $17.4B in loans President George W. Bush authorized back in December. Meanwhile, President Obama has continued to add restrictions to these handouts, rejecting the initial restructuring plans from both companies, essentially firing Rick Wagoner and telling Chrysler to make a deal with Fiat. While Chrysler has until next Wednesday to finish that deal, CF has apparently turned down the funding over the waiver issue, which had been added early this month.

[Source: Detroit Free Press]

REPORT: Unsigned waivers to blame for Chrysler Financial rejection of gov't cash originally appeared on Autoblog on Tue, 21 Apr 2009 11:40:00 EST. Please see our terms for use of feeds.

Permalink | Email this | Comments]]>breakingchrysler financialChryslerFinancialdetroit 3detroit 3 bailoutDetroit3Detroit3Bailoutgovernment bailoutgovernment loansGovernmentBailoutGovernmentLoansreporttarptarpmoneytroubled asset relief programTroubledAssetReliefProgramTue, 21 Apr 2009 11:40:00 EST<![CDATA[REPORT: Chrysler Financial turns down government loan over executive pay limit stipulations]]>http://www.autoblog.com/2009/04/20/report-chrysler-financial-turns-down-government-loan-over-execu/http://www.autoblog.com/2009/04/20/report-chrysler-financial-turns-down-government-loan-over-execu/http://www.autoblog.com/2009/04/20/report-chrysler-financial-turns-down-government-loan-over-execu/#commentsFiled under: , ,

Earlier this month Chrysler Financial (CF) turned down a $750 million loan from the government meant to allow it to continue providing loans to dealers. This is where it turns into he-said-she-said: a source told the Washington Post that CF turned the loan down because a condition of the loan was having the "top 25 executives sign waivers regarding their compensation." Supposedly, some of the execs wouldn't do that.

Another source refuted that, saying there was no way executives would turn down a loan if it would help the company survive. Nevertheless, CF's response to the story seems a little disingenuous. The company said "Executives have not been presented with any new demands with regard to executive compensation." That's straightforward enough. But then it adds, "As a TARP recipient we remain in full compliance with current executive compensation requirements."

When Chrysler Financial received its TARP loans there were no stipulations at all about executive compensation -- they hadn't been drafted yet. So yes, it is "in full compliance" with the current requirements as it stood when it borrowed the money. Then CF said it didn't any more TARP funds, however, it is going to borrow money at a higher interest rate from a group of banks. Which means it still wants money, just not the government's money, and it's willing to pay more for it. Sounds curious, no? Hat tip to Roger

[Source: Washington Post]

REPORT: Chrysler Financial turns down government loan over executive pay limit stipulations originally appeared on Autoblog on Mon, 20 Apr 2009 21:01:00 EST. Please see our terms for use of feeds.

Read | Permalink | Email this | Comments]]>bailoutchryslerchrysler financialChryslerFinancialearningsfinancialsgovernmenttarpMon, 20 Apr 2009 21:01:00 EST<![CDATA[Cerberus may cut 10% of its workforce]]>http://www.autoblog.com/2009/01/22/cerberus-may-cut-10-of-workforce/http://www.autoblog.com/2009/01/22/cerberus-may-cut-10-of-workforce/http://www.autoblog.com/2009/01/22/cerberus-may-cut-10-of-workforce/#commentsFiled under: , , ,

That Chrysler continues to struggle isn't exactly news. As a whole, the auto industry is tanking and cars just aren't moving off dealer lots. Chrysler initially responded by offering buyouts to its entire workforce, and 25% off all its salaried workers took the company up on the offer. Earlier this week, we learned that the ailing Auburn Hills empire will get cozy with Italian automaker Fiat. What we haven't heard as much about, however, is the health of Chrysler's parent company, Cerberus Capital Management.

Like many investment institutions, the three-headed dog is looking to save money, and some of that cash may come at the expense of its workforce. Cerberus has 275 workers around the globe, and up to 10% of those employees will likely face the axe. The private equity firm has struggled with Chrysler, GMAC and Chrysler Financial, but anyone watching the stock market knows the rest of the business world hasn't really fared much better. Blackstone, which also bid on Chrysler back in 2007, is cutting 5% of its workers, and the Carlyle group 10%. The Cerberus job cuts are only a fraction of the bloodletting Chrysler has had to endure over the past two years, but at least it shows that the Pentastar isn't the only one making the sacrifice.

[Source: Automotive News subs req'd]

Cerberus may cut 10% of its workforce originally appeared on Autoblog on Thu, 22 Jan 2009 19:29:00 EST. Please see our terms for use of feeds.

Read | Permalink | Email this | Comments]]>auburn hillsAuburnHillscapital managementCapitalManagementcerberuschryslerChrysler financialChryslerFinancialGMACjob lossesJobLossesllcventure capitalVentureCapitalThu, 22 Jan 2009 19:29:00 EST<![CDATA[Fed grants GMAC bank holding status]]>http://www.autoblog.com/2008/12/24/the-fed-grants-gmac-given-bank-holding-status/http://www.autoblog.com/2008/12/24/the-fed-grants-gmac-given-bank-holding-status/http://www.autoblog.com/2008/12/24/the-fed-grants-gmac-given-bank-holding-status/#commentsFiled under: , ,

GMAC - and ergo General Motors - just got another Christmas present: the Federal Reserve has granted GMAC bank holding status. GMAC has billions of dollars of bonds coming due over the next 12 months, but doesn't have the liquidity to cover the obligations. As of last week, the financing company was in the midst of a bond buyback effort in order to raise enough money to qualify for bank holding status. Now that it's been granted, GMAC can tap the Troubled Asset Relief Fund intended for financial institutions, pay its debts and (probably) avoid bankruptcy.

It isn't clear, however, whether or not GMAC actually raised enough money through the bond buyback. The Fed said "emergency conditions" justified its actions, which makes us think the Fed just said "Here, take it." Looked at from a dealer perspective, it makes sense: if GMAC had gone under, one dealer estimated that it would have taken 30-40% of GM dealers down with it, and that could imperil GM itself. It wouldn't make much sense to let that happen when the government just loaned GM a bunch of money to stay in business.

And while GM is still a long, long way from getting the kind of money that any number of banks have, it's still beginning to add up. As a result of the new status, both GM and Cerberus are required to lower their stakes in GMAC. Cerberus has been told to lower its share to 33%, down from 51%; GM has said it will go below 10%. As for Cerberus' other headache, Chrysler Financial, it has said that if dealers don't stop making a run on its funds, it will cease financing for dealer inventories.

[Source: Yahoo!]

Fed grants GMAC bank holding status originally appeared on Autoblog on Wed, 24 Dec 2008 19:57:00 EST. Please see our terms for use of feeds.

Read | Permalink | Email this | Comments]]>auto bailoutAutoBailoutcerberuschrysler financialChryslerFinancialearningsfinancialsfinancinggmgmactarpwall street bailoutWallStreetBailoutWed, 24 Dec 2008 19:57:00 EST<![CDATA[GM/Cerberus talks over full ownership of GMAC]]>http://www.autoblog.com/2008/10/12/gm-cerberus-talks-over-full-ownership-of-gmac/http://www.autoblog.com/2008/10/12/gm-cerberus-talks-over-full-ownership-of-gmac/http://www.autoblog.com/2008/10/12/gm-cerberus-talks-over-full-ownership-of-gmac/#commentsFiled under: , ,

It's been a crazy few days as news broke that Chrysler and General Motors have been in talks to combine operations. It turns out that there's a pretty significant back-story to these proceedings, and it involves Cerberus Capital Management's possible desire to shed its car-building operations and acquire the rest of GMAC, of which it already holds a controlling stake of 51%, with GM holding holding the other 49%. According to reports, Cerberus would like to combine Chrysler Financial with GMAC, which would allow it to merge the offices of the two financial institutions and reduce costs. All right, that might make some sense, but what about merging the two automakers? That's the part that seems so confusing to analysts and us meager bloggers. Somehow, we feel certain that there's more to this story, which we'll be hearing about for some time.

[Source: The Detroit News]

GM/Cerberus talks over full ownership of GMAC originally appeared on Autoblog on Sun, 12 Oct 2008 18:31:00 EST. Please see our terms for use of feeds.

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It's up and down, but nowhere near out for Chrysler, LLC. The Big Three's smallest sibling says that it's ahead of internal estimates and has posted earnings in excess of one billion for the first half of '08. True, the company also posted a $510 million loss in Q1 according to minority shareholder Daimler. And since Chrysler is privately held, it doesn't need to tell anyone whether these earnings put it in the red or black.

But whatever's on the books was good enough to convince lenders to grant Chrysler's financial arm a $24 billion line of credit. Said a Chrysler spokesman, the money will be used to "support our dealers and their retail customers." The pentastar just got out of the leasing business, so the influx of credit will keep the financial arm doing what it needs to do as all those remaining lease vehicles come back with empty tanks and bottomed-out residuals. And believe it or not, those are all good things.

[Source: Detroit News]

Chrysler Financial scores $24B line of credit originally appeared on Autoblog on Mon, 04 Aug 2008 10:32:00 EST. Please see our terms for use of feeds.

Read | Permalink | Email this | Comments]]>chryslerchrysler financialchrysler llcChryslerFinancialChryslerLlcearningsfinancefinancesfinancialsline of creditLineOfCreditMon, 04 Aug 2008 10:32:00 EST<![CDATA[Chrysler offering even more incentives to close out July]]>http://www.autoblog.com/2008/07/25/chrysler-offering-even-more-incentives-to-close-out-july/http://www.autoblog.com/2008/07/25/chrysler-offering-even-more-incentives-to-close-out-july/http://www.autoblog.com/2008/07/25/chrysler-offering-even-more-incentives-to-close-out-july/#commentsFiled under: , , , , ,



The automotive sales sector is in a major state of flux as consumers continue to run from SUVs and pickup trucks into smaller, more fuel efficient cars. One manufacturer hit especially hard by this transition is Chrysler, a company that recently posted the worst fleet average fuel economy numbers of all major automakers in the U.S. due to its truck-heavy lineup. Still, the automaker has built up a large supply of Chrysler, Dodge and Jeep utility vehicles that they have got to get off dealer lots somehow. To ease consumers into the fuel-thirsy utes, Chrysler has introduced new incentives of zero-percent financing for 72 months on the 2008 Dodge Durango, Chrysler Aspen and Jeep Grand Cherokee and Commander.

While the lack of any financing charges will certainly impact the bottom line, it is nothing compared to the losses the automaker has been hit with over its past lease deals. In fact, truck and SUV residuals are so bad these days that Chrysler Financial has gone so far as to completely cut leasing out of its available portfolio starting August 1. The financing deals announced today are scheduled to continue through Thursday, July 31.

[Source: Automotive News - sub. req'd]

Chrysler offering even more incentives to close out July originally appeared on Autoblog on Fri, 25 Jul 2008 16:59:00 EST. Please see our terms for use of feeds.

Read | Permalink | Email this | Comments]]>chryslerchrysler aspenchrysler financialchrysler groupchrysler incentivechrysler incentiveschrysler leasechrysler llcChryslerAspenChryslerFinancialChryslerGroupChryslerIncentiveChryslerIncentivesChryslerLeaseChryslerLlcdodge durangoDodgeDurangojeep commanderjeep grand cherokeeJeepCommanderJeepGrandCherokeeFri, 25 Jul 2008 16:59:00 EST<![CDATA[Nardelli says Chrysler in a financial jam]]>http://www.autoblog.com/2007/12/21/robert-nardelli-says-chrysler-is-in-a-financial-jam/http://www.autoblog.com/2007/12/21/robert-nardelli-says-chrysler-is-in-a-financial-jam/http://www.autoblog.com/2007/12/21/robert-nardelli-says-chrysler-is-in-a-financial-jam/#commentsFiled under: ,



Chrysler Chief Executive Robert Nardelli tells a grim tale for the automaker's 2007 financial report. He has informed employees that the company is barreling towards a substantial loss this year. Bankruptcy would be imminent without $10 billion recently received from investors during the Cerberus acquisition. The company is in dire need of increased cash holdings. Nardelli hopes to sell off $1 billon in assets, composed partially of old plants and land, to generate more funds. The Chief Executive also calls for improved vehicle interiors, realistic sales forecasts, production reduction and increased use of overseas suppliers.

While the former Home Depot head was criticized at his old job for hard tactics, he has presented a friendlier side with Chrysler employees, particularly the engineers. It does not seem however, that he has warmed up to the upper management in place. Nardelli has brought in other former Home Depot executives to consult in areas of Chrysler such as HR, marketing and purchasing. This move has caused at least one veteran executive to jump ship. Time will tell if his style is just what the company needs to get back on its feet, though.

[Source: Wall Street Journal, Photo by Bill Pugliano/Getty]

Nardelli says Chrysler in a financial jam originally appeared on Autoblog on Fri, 21 Dec 2007 10:55:00 EST. Please see our terms for use of feeds.

Read | Permalink | Email this | Comments]]>bob nardelliBobNardelliChryslerChrysler FinancialChryslerFinancialRobert NardelliRobertNardelliFri, 21 Dec 2007 10:55:00 EST<![CDATA[Chrysler blocks the doors to prevent white collar exodus]]>http://www.autoblog.com/2007/08/08/chrysler-blocks-the-doors-to-prevent-white-collar-exodus/http://www.autoblog.com/2007/08/08/chrysler-blocks-the-doors-to-prevent-white-collar-exodus/http://www.autoblog.com/2007/08/08/chrysler-blocks-the-doors-to-prevent-white-collar-exodus/#commentsFiled under: , ,

Chrysler is apparently a little worried that there might be a mass exodus of executives during the transition from DaimlerChrysler "partnership of equals" to Cerberus stewardship. Because of that, they have taken the bold step of advising current employees against applying for jobs at Daimler AG or Chrysler Financial.

The Detroit News obtained an internal email written to Chrysler's senior white-collar staff by Rita C. Rinner, Chrysler's manager of global staff. In the letter she advises that "Requests to interview for positions at Chrysler Financial and other Daimler units, including Mercedes-Benz USA, 'are currently not advised'."

The e-mail went out to senior Chrysler employees, but applies to all white-collar workers and their staffs. It also went out the same day Bob Nardelli was named as the new CEO of Chrysler. Did they really think the execs would be that afraid of what Nardelli had in store? Perhaps. He does have that kind of ruthlessly efficient reputation.

[Source: The Detroit News]

Chrysler blocks the doors to prevent white collar exodus originally appeared on Autoblog on Wed, 08 Aug 2007 19:28:00 EST. Please see our terms for use of feeds.

Read | Permalink | Email this | Comments]]>Bob NardelliBobNardelliCerberusChrysler FinancialChryslerFinancialDaimler AGDaimlerAgRita C. RinnerRitaC.RinnerWed, 08 Aug 2007 19:28:00 EST