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 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.

Read | Permalink | Email this | Comments]]>cerberuschryslerChrysler FinancialChryslerFinancialearningsfinancialsKenneth FeinbergKennethFeinbergpay czarPayCzarSun, 25 Oct 2009 09:27:00 EST<![CDATA[REPORT: Jim Press leaving Chrysler by year's end]]>http://www.autoblog.com/2009/08/21/report-jim-press-leaving-chrysler-by-years-end/http://www.autoblog.com/2009/08/21/report-jim-press-leaving-chrysler-by-years-end/http://www.autoblog.com/2009/08/21/report-jim-press-leaving-chrysler-by-years-end/#commentsFiled under: , ,

According to The Wall Street Journal Jim Press, the Chrysler Group LLC Deputy Chief Executive and sole surviving member of pre-bailout/bankruptcy Chrysler will be resigning his post by the end of November. The WSJ quotes three anonymous people close to the plan. When reached for comment, Press only stated, "I don't think anything has been released about management changes." If true, Press's departure will leave Fiat/Chrysler CEO Sergio Marchionne without any former-Chrysler advisers -- which may not be such a bad thing considering recent offerings like the Sebring, Journey and Caliber.

Still, one has to question the wisdom of losing a salty North American market insider like Jim Press, who spent 37 years at Toyota. Especially since Press was in the trenches when the Japanese automaker went from screwball import in the Sixties to the largest automaker in the world just a few decades later - a trick that Fiat would no doubt like to emulate.

Press was hired by Chrysler's former masters, Cerberus Capital Management LP, in 2007. His ToMoCo experience was supposed to help right Chrysler's boat, but it had too many holes in the hull from the apparent abuses inflicted by former "equal" Daimler. After a year on the job, Press found Chrysler on the brink of bankruptcy, and a few months later, they went under. If this report is true, it will be a sad chapter in an otherwise stellar career. Stay tuned.

[Source: The Wall Street Journal | Image: Bill Pugliano/Getty]

REPORT: Jim Press leaving Chrysler by year's end originally appeared on Autoblog on Fri, 21 Aug 2009 14:27:00 EST. Please see our terms for use of feeds.

Permalink | Email this | Comments]]>CerberusChryslerJim PressJimPressSergio MarchionneSergioMarchionneToyotaFri, 21 Aug 2009 14:27:00 EST<![CDATA[The tale that wagged the dog: Cerberus' Stephen Feinberg speaks]]>http://www.autoblog.com/2009/08/14/the-tale-that-wagged-the-dog-cerberus-stephen-feinberg-speaks/http://www.autoblog.com/2009/08/14/the-tale-that-wagged-the-dog-cerberus-stephen-feinberg-speaks/http://www.autoblog.com/2009/08/14/the-tale-that-wagged-the-dog-cerberus-stephen-feinberg-speaks/#commentsFiled under: ,



Now that the crime is over, the verdict issued and the sentencing issued, we can look forward to a few months years of the CSI treatment applied to what really happened at Chrysler. The first exhibit is a New York Times piece with Cerberus co-founder Stephen Feinberg, coming off almost as The Man Would Would Be Iacocca.

The first quote - "I don't know what we could have done differently. From the day we bought it, we worked hard to improve it" -- is the kind of statement that, no matter how true it is, would likely elicit numerous objections. Yet the issue of whether Cerberus should have bought Chrysler or whether it knew what is was doing is only the second most compelling theme of the Times piece.

The real hook is the competing justifications of why Cerberus bought Chrysler. On the one hand, many feel that it was a play to get Chrysler Financial and marry it with GMAC. The other hand, as Feinberg notes more than once, was supposedly holding an American flag - that is, the Cerberus deal was about patriotism and doing what's right for the country. That's a narrative we had never even considered - private equity and The Good of America don't often dine together in our world - but have a read and decide for yourself.

[Source: New York Times | Photo by Bill Pugliano/Getty]

The tale that wagged the dog: Cerberus' Stephen Feinberg speaks originally appeared on Autoblog on Fri, 14 Aug 2009 19:58:00 EST. Please see our terms for use of feeds.

Read | Permalink | Email this | Comments]]>cerberuschryslerchrysler bankruptcyChryslerBankruptcyfeinberggovernmentstephen feinbergStephenFeinbergsteve feinbergSteveFeinbergFri, 14 Aug 2009 19:58:00 EST<![CDATA[REPORT: If Chrysler goes down, it could cost Daimler $1 billion]]>http://www.autoblog.com/2009/04/10/report-if-chrysler-goes-down-it-could-cost-daimler-1-billion/http://www.autoblog.com/2009/04/10/report-if-chrysler-goes-down-it-could-cost-daimler-1-billion/http://www.autoblog.com/2009/04/10/report-if-chrysler-goes-down-it-could-cost-daimler-1-billion/#commentsFiled under: , ,



Nerves are frazzled in Stuttgart over the troubles facing Chrysler. Let's not forget that Daimler still has a skin in the Chrysler game, and while everyone natters and frets about whether or not Fiat will prove to be the Savior Of Auburn Hills, execs are also thinking about the worst-case scenario in the halls of Daimler.

According to the Detroit Bureau, Bodo Uebber, Daimler's Chrysler guy, reported recently that concerned shareholders are rightfully nervous, as Daimler could be stuck with a $1 billion liability if Chrysler ist kaput. Unfunded pensions and potential claims from suppliers could result in very bad things for Daimler. Cerberus and the German automaker are also duking it out over whether Chrysler's health was honestly disclosed at the time of the deal, tying up any developments with the remaining 19.9 percent of Chrysler that Daimler still owns. Both Uebber and Dieter Zetsche, Daimler's CEO, are actively trying to unload the company's stake in Chrysler to Cerberus, but predictably, that conversation isn't going anywhere at the moment.

[Source: The Detroit Bureau | Image: Bill Pugliano/Getty]

REPORT: If Chrysler goes down, it could cost Daimler $1 billion originally appeared on Autoblog on Fri, 10 Apr 2009 11:29:00 EST. Please see our terms for use of feeds.

Read | Permalink | Email this | Comments]]>cerberuscerberus chryslerCerberusChryslerchrysler daimlerchrysler llcChryslerDaimlerChryslerLlcdaimlerdaimler agdaimler cerberusdaimler chryslerdaimler-chryslerDaimlerAgDaimlerCerberusdaimlerchryslerFri, 10 Apr 2009 11:29:00 EST<![CDATA[Cerberus to reportedly lose stake in Chrysler as part of bailout deal]]>http://www.autoblog.com/2009/03/31/cerberus-to-reportedly-lose-stake-in-chrysler-as-part-of-bailout/http://www.autoblog.com/2009/03/31/cerberus-to-reportedly-lose-stake-in-chrysler-as-part-of-bailout/http://www.autoblog.com/2009/03/31/cerberus-to-reportedly-lose-stake-in-chrysler-as-part-of-bailout/#commentsFiled under: ,



According to The Wall Street Journal, Cerberus Capital Management is set to shed its stake in Chrysler as part of the conditions surrounding the company's bailout arrangement with the U.S. government.

According to the article, the financial paper cites an anonymous source within the Obama administration as effectively saying that "Cerberus' equity stake no longer holds value" and "...the firm's ownership will come to an end."

According to the WSJ's sources, Cerberus will still hold on to a controlling stake in Chrysler Financial, but its stake in the automaker itself will likely be eviscerated. Such a move could make it easier for Chrysler and Fiat to come to terms on their alliance within the next 30 days (a deadline given to them by the Obama administration yesterday).

[Source: The Wall Street Journal]

Cerberus to reportedly lose stake in Chrysler as part of bailout deal originally appeared on Autoblog on Tue, 31 Mar 2009 10:05:00 EST. Please see our terms for use of feeds.

Permalink | Email this | Comments]]>CerberusChryslerFiatObamaObama AdministrationObamaAdministrationWSJTue, 31 Mar 2009 10:05:00 EST<![CDATA[GMAC CEO earned $11.6 million last year]]>http://www.autoblog.com/2009/03/02/gmac-ceo-earned-11-6-million-last-year/http://www.autoblog.com/2009/03/02/gmac-ceo-earned-11-6-million-last-year/http://www.autoblog.com/2009/03/02/gmac-ceo-earned-11-6-million-last-year/#commentsFiled under:

The recent string of government bailouts has placed a 50,000-watt spotlight on executive pay. Executives from Detroit automakers have already cut their pay to show the public and their own workforces that they're sacrificing for the greater good. There hasn't been much focus, however, on finance arm executives, though there likely will be after Automotive News learned that GMAC CEO Alvaro de Molina was paid $11.6 million in 2008. Molina's 2008 windfall comes one year after he pulled in nearly $5 million in 2007; an amazing amount of money considering he started at GMAC in September of that year.

The breakdown of what Molina earned in 2008 is actually $1.2 million in salary, $5.81 million in stocks and $4.8 million of "other" compensation, offset by stock options that pulled the grand total down by $194,000. Included in the $4.8 million "other" compensation is $2.26 million in usage of a company jet, a privilege that has since been revoked.

If your stomach is turning at the thought of a finance CEO making $11.6 million when his company is losing billions on its mortgage and automotive finance operations, you're not alone. We're guessing that Molina's 2009 will be significantly less lucrative than 2008, but likely still more than most of us feel any CEO deserves.

[Source: Automotive News subs req'd]

GMAC CEO earned $11.6 million last year originally appeared on Autoblog on Mon, 02 Mar 2009 10:27:00 EST. Please see our terms for use of feeds.

Read | Permalink | Email this | Comments]]>alvaro de molinaAlvaroDeMolinaCerberusGMGMACMon, 02 Mar 2009 10:27:00 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[Who's the Boss? Daimler still wants to offload remaining stake in Chrysler]]>http://www.autoblog.com/2009/01/21/whos-the-boss-daimler-still-wants-to-offload-remaining-stake-i/http://www.autoblog.com/2009/01/21/whos-the-boss-daimler-still-wants-to-offload-remaining-stake-i/http://www.autoblog.com/2009/01/21/whos-the-boss-daimler-still-wants-to-offload-remaining-stake-i/#commentsFiled under: , ,

For over a decade, ownership of Chrysler has been bouncing back and forth over the Atlantic like an Airbus jet. Since its founding in 1925, it was independently owned and operated right out of Detroit, then Daimler bought controlling interest in 1998, only to sell it to U.S.-based Cerberus Capital Management. Now Fiat is poised to assume a 35% stake in the company. So the question is, who holds controlling interest? Well in short, nobody does. Daimler holds nearly 20%, Fiat's taking over 35%, leaving Cerberus with 45% - the lion's share, but short of controlling interest.

But while the majority of Chrysler's shares may be back in Europe, Daimler isn't interested in holding onto its stake. Daimler and Cerberus had been talking about transferring ownership of the remaining 20% for a while already, but with America's financial institutions in shambles, who knows if the capital management company can even manage to find the capital to buy the rest of the company. In the meantime, it looks like Chrysler's at the whim of European automakers... yet again.

[Source: Reuters]

Who's the Boss? Daimler still wants to offload remaining stake in Chrysler originally appeared on Autoblog on Wed, 21 Jan 2009 07:58:00 EST. Please see our terms for use of feeds.

Read | Permalink | Email this | Comments]]>cerberuscerberus fiatCerberusFiatchryslerchrysler fiatChryslerFiatdaimlerdaimler cerberusdaimler chryslerdaimler fiatdaimler shares chryslerDaimlerCerberusdaimlerchryslerDaimlerFiatDaimlerSharesChryslerfiatfiat chryslerFiatChryslerWed, 21 Jan 2009 07:58:00 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, Chrysler holding merger talks again? Or not...]]>http://www.autoblog.com/2008/12/18/gm-chrysler-holding-merger-talks-again-or-not/http://www.autoblog.com/2008/12/18/gm-chrysler-holding-merger-talks-again-or-not/http://www.autoblog.com/2008/12/18/gm-chrysler-holding-merger-talks-again-or-not/#commentsFiled under: , , , , , ,



Can this really be happening all over again? Weeks after merger talks between Chrysler and GM seemed to implode, the companies may be talking about hooking up again, according to the Wall Street Journal. General Motors Corp. and Chrysler LLC have reportedly stepped back into the negotiation room after Chrysler owner Cerberus Capital Management LP said that maybe, just maybe, it's willing to give up some ownership in the Pentastar. In fact, it may be that Cerberus has started this latest round of talks to show Washington it's willing to play nice with the other kids to secure part of a $14 billion rescue package that's on the table.

Nevertheless, GM spokesman Tony Cervone woke up this morning and immediately denied that merger talks between the two weakest Detroit automakers have resumed, saying only that GM's stance on the merger is the same as it was in November.

We talked about this the last time a merger was mentioned, but consolidating these two automakers would most likely lead to massive layoffs and more than a few plant shutdowns, plus the elimination of a lot of Chrysler models. There is too much capacity and overlap between the two companies' product lineups, but with money running low for both of them, merging could still be made a condition of receiving federal assistance.

[Source: Wall Street Journal via The Globe and Mail, Marketwatch]

GM, Chrysler holding merger talks again? Or not... originally appeared on Autoblog on Thu, 18 Dec 2008 10:58:00 EST. Please see our terms for use of feeds.

Read | Permalink | Email this | Comments]]>cerberuscerberus capital managementCerberus Chrysler GMCerberusCapitalManagementCerberusChryslerGmchrysler gmchrysler gm mergerChryslerGmChryslerGmMergergm chryslergm chrysler mergerGmChryslerGmChryslerMergerThu, 18 Dec 2008 10:58:00 EST<![CDATA[GMAC rushes to conclude bond buyback and avoid bankruptcy]]>http://www.autoblog.com/2008/12/16/gmac-rushes-to-conclude-bond-buyback-and-avoid-bankruptcy/http://www.autoblog.com/2008/12/16/gmac-rushes-to-conclude-bond-buyback-and-avoid-bankruptcy/http://www.autoblog.com/2008/12/16/gmac-rushes-to-conclude-bond-buyback-and-avoid-bankruptcy/#commentsFiled under: , ,

GM doesn't just have its eye on auto bailout funds -- its GMAC division (of which it owns 49%) is looking for cash from among the $700 billion pledged in the Wall Street bailout. Through the end of next year, GMAC has roughly $12 billion in bonds maturing. But to have any chance at getting Wall Street funds to address those maturing bonds, GMAC wants to become a bank holding company. And to do that, it must raise $30 billion, with $2 billion of that tapped from new sources.

GMAC is looking for 75% of its bondholders to participate in a bond buyback, whereby a bondholder would return bonds worth $1,000 and get about $800 worth of bonds with a higher dividend in return. If it gets participation from 75% of it's bondholders, that will give it $28.5 billion, which it can add to $750 million GMAC says has been pledged by shareholders as part of the $2 billion requirement. That's not quite $30 billion, but closer is better than nothing.

The problem is that, for the moment, GMAC has only 25% participation. GMAC said it had a fresh round of bondholders willing to swap, but didn't make it clear whether that would get it to 75%. If it doesn't get the financing to become a bank holding company, GMAC would likely need to declare bankruptcy. And if that happens? Well, GMAC provides inventory financing for 80% of GM vehicles worldwide. Without that source of financing, said Martin NeSmith,"There's so many dealers on the edge, if GMAC goes out of business 30 to 40 percent of dealers won't be able to get financing from anywhere else." And that spells even more trouble -- and bankruptcies -- for everyone.

[Source: Automotive News - Sub. Req.]

GMAC rushes to conclude bond buyback and avoid bankruptcy originally appeared on Autoblog on Tue, 16 Dec 2008 09:00:00 EST. Please see our terms for use of feeds.

Read | Permalink | Email this | Comments]]>auto bailoutAutoBailoutcerberusfinancinggmgmacwall street bailoutWallStreetBailoutTue, 16 Dec 2008 09:00:00 EST<![CDATA[Cerberus making big demands for remaining stake in Chrysler]]>http://www.autoblog.com/2008/11/26/cerberus-making-big-demands-for-remaining-stake-in-chrysler/http://www.autoblog.com/2008/11/26/cerberus-making-big-demands-for-remaining-stake-in-chrysler/http://www.autoblog.com/2008/11/26/cerberus-making-big-demands-for-remaining-stake-in-chrysler/#commentsFiled under: , ,



Daimler has already admitted that its 19.9% share in Chrysler is worth absolutely zero as far as its corporate balance sheets are concerned, but that's not stopping Cerberus from going after that remaining bit as it tries to become the sole owner of the beleaguered American automaker. Without full control of Chrysler, Cerberus would have a tough time offloading it in either one lump deal or in smaller, bit-by-bit transactions. But it sounds like Chrysler's majority owner isn't making life easy for Daimler, accusing the German entity of providing incomplete information about Chrysler and prolonging the actual sale that took place late in 2007. As you'd expect, Daimler is denying these accusations completely and is claiming that Cerberus is making outlandish demands to take the rest of the company off its German hands.

Accusations beget accusations, so it's not terribly shocking that Cerberus has issued a press release countering Daimlers to explain its side of the story. From what we can discern from these early punches is that Cerberus has taken issue with Chrysler's past lease and financing practices while under Daimler's control. You can read the dueling press releases from Daimler and Cerberus after the break.

Despite the German and American origins of the dispute, the whole thing's playing out like a proper Telemundo telenovela. We await the obligatory kiss-and-make-up scene at the end.

[Source: Detroit News]

Continue reading Cerberus making big demands for remaining stake in Chrysler

Cerberus making big demands for remaining stake in Chrysler originally appeared on Autoblog on Wed, 26 Nov 2008 14:32:00 EST. Please see our terms for use of feeds.

Read | Permalink | Email this | Comments]]>cerberuscerberus capital managementcerberus daimlercerberus daimlerchryslerCerberusCapitalManagementCerberusDaimlerCerberusDaimlerchryslerdaimlerWed, 26 Nov 2008 14:32:00 EST<![CDATA[Viper still selling like hotcakes, ACR sold out]]>http://www.autoblog.com/2008/11/05/viper-still-selling-like-hotcakes-acr-sold-out/http://www.autoblog.com/2008/11/05/viper-still-selling-like-hotcakes-acr-sold-out/http://www.autoblog.com/2008/11/05/viper-still-selling-like-hotcakes-acr-sold-out/#commentsFiled under: , ,


Click above for high-res gallery of the Viper ACR

Chrysler may be burning to the ground like ancient Rome, but its craziest citizen, the Dodge Viper, is out dancing in the streets. Because even while General Motors prepares to ransack Chrysler LLC, the Viper sales are continuing undeterred. Although Chrysler sales overall are reportedly down a whopping 32%, Dodge continues to produce and sell Vipers at a rate of 100 units per month. Not just that, but the Viper ACR - the $105k track-prepped super-snake - is all but entirely sold out... not in spite of the poor economy, but because of it. Chrysler reports that with stock portfolios rapidly losing their value and dollar values plummeting, investors are seeing the Viper ACR - potentially to be discontinued and retaining a high resale value - as a sound investment opportunity. With smile inducing dividends, too.

While GM and Cerberus talk take-over turkey, the fiscal viability of the Viper unit is bound to make it an attractive asset for any number of buyers. So while Chrysler may be counting its days, the Viper is likely to live on for some time yet.

Gallery: First Drive: 2008 Dodge Viper ACR


[Source: Inside Line]

Viper still selling like hotcakes, ACR sold out originally appeared on Autoblog on Wed, 05 Nov 2008 10:41:00 EST. Please see our terms for use of feeds.

Read | Permalink | Email this | Comments]]>cerberuschrysler llcchrysler mergerchrysler take overChryslerLlcChryslerMergerChryslerTakeOverdodge viperdodge viper acrdodge viper salesDodgeViperDodgeViperAcrDodgeViperSalessell viperSellViperviperWed, 05 Nov 2008 10:41:00 EST<![CDATA[GM wants $10 billion in aid from the Feds to buy Chrysler]]>http://www.autoblog.com/2008/10/28/gm-wants-10-billion-in-aid-from-the-feds-to-buy-chrysler/http://www.autoblog.com/2008/10/28/gm-wants-10-billion-in-aid-from-the-feds-to-buy-chrysler/http://www.autoblog.com/2008/10/28/gm-wants-10-billion-in-aid-from-the-feds-to-buy-chrysler/#commentsFiled under: , , ,



In the latest development of The Incomprehensible Union, General Motors is reportedly asking the U.S. government for $10 billion -- on top of the $25 billion loan approved recently -- to help it merge with Chrysler. The supplemental infusion would give the government, i.e. you and me, a stake in the merged company in the form of preferred stock, would see the government taking over pension obligations and provide a credit line for operations.

The government is weighing the request since it's likely that no federal official wants to be on the watch that saw the instantaneous vaporizing of two American icons and hundreds of thousands of jobs. The government has asked that as many jobs as possible be spared, and GM said "Sure!" Yet for a merger where cost savings and redundancy elimination have been the headlines, we don't know why anyone believes GM-Chrysler wouldn't jettison a whole bunch of the 11 brands, 10,000 dealers, and 100,000 union jobs. And that's just for starters.

Which is one of the (many) reasons we still don't understand the GM-Chrysler union. The additional $10 billion we can swallow -- after all, the government spends much more than that on projects that could be considered far more dubious than trying to save an astronomical number of jobs and businesses. And we know what Cerberus gets from the deal. We'd like to find out what the GM guys see that makes this merger attractive... other than the fact that Chrysler has $11 billion in cash.

[Source: Reuters]

GM wants $10 billion in aid from the Feds to buy Chrysler originally appeared on Autoblog on Tue, 28 Oct 2008 16:01:00 EST. Please see our terms for use of feeds.

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So, just what is a 19.9% stake in America's third largest automaker worth? Um, nothing. So says Daimler, which owns exactly that amount. The German company claims that, for accounting purposes at least, there is absolutely no value in its part-ownership of Chrysler. Just about a year ago, Daimler estimated that its share of Chrysler was worth some $1.17 billion. The remaining 80.1% was sold to Cerberus Capital Management last August for $7.4 billion.

According to Chrysler, Daimler's idea of its stake in the company is a totally different animal than its own. The two companies use different accounting techniques to arrive at earnings figures and net worth, and the privately-held American automaker doesn't release its internal figures. As we've covered, Daimler is currently in talks with Cerberus to rid itself of any attachment to its former partner by selling its remaining shares of Chrysler to the American company, which it would need if it were to make any sort of deal with General Motors, Renault or any other automaker for that matter. So, just how much is Chrysler worth as a whole? We could soon find out.

[Source: The Detroit News]

What's Chrysler worth to Daimler? Zip, Zero, Nada, Donut originally appeared on Autoblog on Fri, 24 Oct 2008 16:59:00 EST. Please see our terms for use of feeds.

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Click for hi-res gallery of the 2008 Dodge Viper SRT-10

Cerberus may be trying to offload Viper, but not before it gives over a million Americans the opportunity to pick one up at discounted prices. Until now the Viper remained outside Chrysler's Employee Purchase and Certain Designated Individuals discount program, but that's about to change as the supercar joins the list of eligible vehicles.

While Chrysler employs over 130,000 people, we doubt many of them, especially in this economic climate, will have the means or motivation to pick up the gas-guzzling V10 muscle car. However, an arrangement between Chrysler and Wal-Mart extends the benefits program to employees of the mega-retail chain, and with over 1.2 million employees, we're sure there are a few who'll take Chrysler up on its offer. Don't go rushing to pick up an ACR, however, as the track-focused model remains outside the program.

Gallery: Review: 2008 Dodge Viper SRT10

[Source: Chrysler]

Attention Shoppers: Dodge Viper now eligible for employee pricing originally appeared on Autoblog on Wed, 22 Oct 2008 12:31:00 EST. Please see our terms for use of feeds.

Read | Permalink | Email this | Comments]]>cerberuschrysler employee pricingChryslerEmployeePricingdodge viperDodgeViperemployee pricingEmployeePricingviperWed, 22 Oct 2008 12:31:00 EST<![CDATA[Cerberus attempting to buy remaining stake in Chrysler from Daimler]]>http://www.autoblog.com/2008/10/17/cerberus-attempting-to-buy-remaining-stake-in-chrysler-from-daim/http://www.autoblog.com/2008/10/17/cerberus-attempting-to-buy-remaining-stake-in-chrysler-from-daim/http://www.autoblog.com/2008/10/17/cerberus-attempting-to-buy-remaining-stake-in-chrysler-from-daim/#commentsFiled under: ,

One aspect of the possible GM/Chrysler merger often overlooked is that Daimler didn't completely divest itself of its Chrysler ownership back in early 2007, and the German automaker's 19.9% stake could get in the way of any deal. Daimler has been clear that it is disinterested in becoming part of some Detroit super conglomerate, and Automotive News is reporting that Cerberus is close to a deal to buy up the remaining 19.9% stake. Also part of the rumor mill is possible involvement with Renault/Nissan, which has been actively working with Chrysler on collaboration projects in the past year.

According to CNBC, the merger of GM and Chrysler could be complete within the next two weeks, but with neither of the two parties talking, it's all speculation at this point. Recent reports from the Wall St. Journal and CNN say that talks are rapidly accelerating, so there could be more to Chrysler/GM talks than we'd originally thought. Then again, the Internets have been wrong before.

[Source: Automotive News subs req'd]

Cerberus attempting to buy remaining stake in Chrysler from Daimler originally appeared on Autoblog on Fri, 17 Oct 2008 19:58:00 EST. Please see our terms for use of feeds.

Read | Permalink | Email this | Comments]]>cerberuschryslerchrysler gm mergerChryslerGmMergergmmergerFri, 17 Oct 2008 19:58:00 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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Before Cerberus took over Chrysler, the Auburn Hills-based automaker announced that it would build a new axle plant in Marysville, MI as part of a broader plan to spend $3 billion on infrastructure upgrades. The new plant is under construction and scheduled to open in 2010, but the three headed dog's keen eye(s) on cash preservation has lead to talks with transmission maker ZF to somehow share the facility. It is unclear at this point what ZF, which is known for its transmissions but also produces axles for Mercedes, would get out of the deal, but the supplier would likely run the plant and get to build and sell axles for Chrysler, as well as other automakers, at the facility. The move to share the Marysville facility with ZF makes sense for Chrysler from a cash standpoint, and it could supply axles for one of the Pentastar's many collaboration projects with other automakers like Nissan. Regardless of whether ZF or Chrysler ends up owning the facility, the plant would still use the union workforce being abandoned from the soon-to-close Detroit Axle plant.

[Source: Detroit Free Press]

ZF may share new Chrysler axle plant originally appeared on Autoblog on Fri, 12 Sep 2008 14:32:00 EST. Please see our terms for use of feeds.

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Automakers want top-notch quality in their vehicles because a good reputation for quality sell more cars. The pleasant side effect of high quality is spending less to repair your own vehicles. Millions of dollars can be saved per one percentage point improvement in warranty costs. Cerberus was quick to crack down on quality woes when it took over Chrysler, and the early fruit of its labor is hundreds of millions of dollars in warranty costs avoided. Chrysler cars and trucks are hitting the dealer less for repairs than before, which has resulted in a 29% drop in warranty claims for the automaker. That's good news for the cash-strapped automaker, and a big reason the privately owned company has earned $1.1 billion since the company's sale. The positive swing in warranty claims means Chrysler can appropriate less money for warranty claims in the future, giving it more money to spend on R&D, engineering, and, hopefully, interiors.

If you're asking yourself, "Aren't Chrysler products close to last in J.D. Power initial quality studies every year?" you're not alone. Chrysler does tend to fare poorly in those surveys, but they concentrate more on things like cup holders, fit and finish, and general interior quality, all of which don't necessarily cost a lot to fix. The Pentastar is going to de-emphasize J.D. Power results going forward, and instead focus on the arguably more influential Consumer Reports rankings. Unfortunately, the Chrysler vehicles haven't fared very well there either, but that can always change. Thanks for the tip, Mike!

[Source: Detroit Free Press, Photo by Scott Olson/Getty]

Chrysler vehicles 29% less broke than before originally appeared on Autoblog on Tue, 09 Sep 2008 10:58:00 EST. Please see our terms for use of feeds.

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