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Despite the fact that Chrysler shares are no longer sold on the stock market, rumors regarding the company's financial standing continue to haunt the number three domestic auto manufacturer in America. Last week, rumors regarding the negative cash flow were so rampant, a company spokesperson went out of his way to deny that the automaker was headed towards bankruptcy. Now, despite constant assurance from Chrysler that it's hitting all of its internal goals, the lack of announced future product and credit warnings from major firms such as Merrill Lynch and Fitch Ratings are causing some industry insiders to predict major changes from the automaker. Some analysts even believe that Cerberus is looking to offload or break up the company, allegations that Chrysler vehemently denies.

Because the automaker is privately held, the world will just need to sit back and wait to see how Cerberus' so-called "buy, fix and hold" strategy will work out. Despite what took place back in the '70s, Chrysler shouldn't get its hopes up for much federal assistance. It goes without saying, though, that Chrysler is going to need some major revamped products if it plans to make it in the tough U.S. market much longer.

[Source: The Detroit Free Press]

For three weeks in a row, now, we've brought you a new Autoblog Podcast courtesy of the B-Team. Here's episode #96 of the Autoblog Podcast, where Chris Shunk, Sam Abuelsamid, and Dan Roth kibbitz over some morsels of recent news. There's the requisite trip to the Autoblog Garage to start things off, then we move into actual discussion points like the CTS Wagon, a gasp of life on the Ford Ranger front, the massive confusion around Cerberus and Chrysler, and Hyundai's nose-thumbing at Toyota's hybrid technology. Remember to send in questions, comments, and suggestions for ways to mark the passing of upcoming episode #100 to podcast at autoblog dawt com. See you next week!

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When the Chrysler 300 dropped on an unsuspecting public in 2004, it was all crisp edges and upright stance, with a bulldog face to help drive home the message of urgent thrust delivered by a reborn Hemi V8. Chrysler's got a refreshing in the pipeline for the 300, and that's giving designers fits. It's akin to sophomore album syndrome – when the original is a huge hit, how, exactly, do you follow it up? Chrysler designers are invoking the Porsche philosophy used to update its 911 through the generations as a roadmap for the 300's body changes, so don't expect anything too dramatic on the outside.

Inside, however, will be where the real action occurs. While not the worst interior Chrysler puts out, it's certainly got room for improvement. Cerberus chairman Steven Feinburg is reportedly passionate about improving the quality of Chrysler's offerings, and the lower quality materials we have today are being jettisoned in favor of more competitive finery. Whether that means competitive with what's out there right now, or as good as what everyone else will have by the time the new 300 hits the market, we don't know. Equipment levels, too, are an area where Chrysler wants to improve. Look for more technology and features that are better executed in the new 300, which the design staff has hopefully not managed to whack with an ugly stick in the name of "continued distinctiveness," or some other marketing double-speak for "we couldn't do better, so we did weird."

[Source: Wards Auto]

If you have a Dodge Ram in the driveway and someone claiming to be Jim Press calls you asking if you're satisfied with your truck, it just might be him. Chrysler recognizes that it has a customer service problem, and the Pentastar is going to extraordinary lengths to correct it. Its top 300 executives and directors are participating in a program called "Customer First" that puts a priority on -- you guessed it -- the customer. The executives, even guys named Nardelli, Press, and LaSorda, are responsible for at least one customer call per day, and all execs will man at least one shift at Chrysler's customer call center.

The Pentastar elite are also partaking in a three month competition to see who can generate the most sales. We don't know what the prize is for the winner, but whomever claims top sales should get something really, really good. Like a lifetime supply of Chrysler Sebrings.

[Source: Detroit Free Press]

Daimler may have divested 80.1% of its ownership in Chrysler, but the German automaker is still feeling pain from the Pentastar. The value of Daimler's portion of Chrysler has dropped from $2.18 billion to $852 million not even a year after the two parted ways. The loss of nearly $1.4 billion in value is a fair chunk of change, even for the mighty Daimler, but the news is not all bad for company shareholders. If Daimler hadn't sold Chrysler to the private equity firm Cerberus as fast as it did, the automaker's stock would likely be in much worse shape.

Since the privately owned Chrysler, LLC doesn't have to report earnings, it claims that its fiscal standing is all peaches and cream. According to Chrysler, the company has had positive earnings since it was bought out by Cerberus last year. The official line that explains the discrepancy with Daimler's reporting is that U.S. accounting rules are much more favorable than those overseas. Damn accountants.

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

Car sales in the U.S. flat-out suck right now, and both domestic and Japanese automakers are feeling the pinch. Chrysler posted a 13.2% decline in its Daily Sales Rate last month while offering 0% financing, so the Auburn Hills-based automaker has little choice but to continue offering free loans in an effort to stop the bleeding. Current deals include five years at 0% for 2008 models and six years for leftover 2007 models. Chrysler is also dealing with folks with less than perfect credit, which is a risky move with credit restrictions so tight right now.

Beyond money for nothing, Chrysler is also looking into further production cuts to keep dealer inventory in check. It's also cutting labor costs by offering buyouts to workers to shed its army of industrial storm troopers by up to 10,000. Times are tough right now in the auto industry, but if you're in the market to buy a new car, 0% appears to be making a comeback

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

The recent decision by Chrysler to give employees a mandatory, unpaid two week vacation has workers peeved, and it's tough to blame them. Many long-time workers have already planned and paid for vacations that land outside of July 7-21, so those employees will have to cancel their plans or risk going unpaid for two weeks. It's very public news that Chrysler isn't exactly rolling in fortunes, and employees know that sacrifices being made, but as the Freep points out, Chrysler management really botched this one.

The problem lies with the absence of communication regarding vacation time until less than four months before the scheduled time off, when many plans are already set, and some vacation is already taken. Then there's the fact that some of the product development is being shuttered for two whole weeks when Chrysler is already behind the competition and can't afford to take half a month off. Cerberus may be new to the auto industry, but it isn't taking the private company long to disenfranchise its employees.

[Source: Free Press]

A key part of Chrysler LLC's agreement last year with the UAW gave the automaker the ability to hire new employees at a fraction of wages and health care of current workers. Since the deal was signed, Chrysler has been trying to show high-cost workers the door. The privately-owned automaker had a goal of 10,000 overall buyouts to cut labor costs, but it doesn't look like the Pentastar is going to get its wish. UAW Vice President General Holiefield told the Detroit Free Press that he didn't think Chrysler would hit its goal.

Holiefield cited a shaky economy as the main reason workers haven't been pulling the trigger on deals that can range from $70,000 to $100,000 just for not working. The issue is once workers leave, there are few jobs available to provide new income. Although the deadline has passed for workers to accept packages, Chrysler isn't divulging the number of workers who have grabbed the deal. Chrysler is working with the UAW to offer more buyouts in the near future.

[Source: Detroit Free Press]

Chrysler has been on the look-out lately for dancing partners for anything from vehicle platforms to alternative propulsion, and the Pentastar has extended its outsourcing to IT services. Chrysler and Tata Consultancy have teamed up on a $120 million, multi-year contract that sources Chrysler's dealer website work to India. The deal effectively continues the partnership formed between Tata and Chrysler in 2002, but the new deal means even more work goes to India.

Chrysler points out that the IT services were previously performed by contractors that weren't Chrysler employees, but the Auburn Hills automaker declined to mention which company lost the work. IT workers at Chrysler are still nervous about the possibility of more IT outsourcing, however, and it's hard to blame them. Chrysler is strapped for cash and looking to free up money for new products, and IT isn't exactly a core automotive function. It will be interesting to see if Chrysler and Tata will one day expand the partnership to include more vehicles, but this time it's just bits and bytes.

[Source: Detroit Free Press]

Cerberus Capital Management shot off a nine-page letter to investors outlining ways that Chrysler could sink, while also pointing out that they believe Chrysler's on the track for success. Some of the possible failure scenarios include a nasty recession, an extreme slowdown in the car market, or a further credit downturn. Credit is already looking green around the gills, and the potential for a widespread domino effect that starts with an implosion of the teetering mortgage business would be catastrophic for Chrysler Financial and GMAC, of which Cerberus owns 51 percent. As easy mortgages and equity go, so goes willy-nilly new car purchasing, and we're probably already seeing the results of that adjustment. Cerberus believes that it can weather a mild credit downturn, and even a mild recession, just fine.

One way to attain success is to declare it, and changing the definition doesn't hurt, either. Cerberus optimistically declares that there's no need to be heroes to earn a good return on their investment. It sounds a little bit like they're saying it's okay to tread water. Stating that it's not necessary to build Chrysler up, even though that's the underlying hope, Cerberus thinks that just hanging in there should be good enough to earn a return. All of Chrysler's employees must feel great knowing that Bob Nardelli, Jim Press, and Tom LaSorda can essentially just keep the company coasting along until Cerberus sells Chrysler off so it can collect that mythical return. Chrysler's performance is so far outpacing expectations, and the company does have cash on hand. Those are actual, concrete good signs that Chrysler could yet emerge from its chrysalis.

[Source: Detroit News]