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Posted
Oct 02 2009, 07:31 AM
by
Douglas McIntyre
Rating:
Money Blog: Top Stocks Blog - MSN Money
Rumors, credible rumors, are beginning to circulate in the car industry and the automotive press, that Chrysler may not make it another year primarily due to its falling sales and growing financial losses at partner Fiat.
Chrysler sold a 62,197 cars in September, down 42% from the same month last year. The figure was down from 93,222 in August when traffic to dealers was pushed up by the ”cash for clunkers” program.
Chrysler’s problems may only be beginning and, if so, Fiat, the ”managing partner” among Chrysler’s owners may not be able to keep the American company intact.
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Posted
Sep 14 2009, 05:49 PM
by
Jon Markman
Money Blog: Top Stocks Blog - MSN Money
No wonder the unemployment rate is so high. The new head of Chrysler has top jobs at five separate companies himself.
Sergio Marchionne, the new hands-on CEO at Chrysler Group LLC in Detroit, is also the CEO of Fiat SpA in Turin, Italy. And he's the chairman of CNH Global NV, an Amsterdam-based farm equipment company. And he's vice-chairman of the Swiss bank UBS AG. And he's also chairman of SGS S.A., a goods-inspection company in Geneva.
The dude is a one-man executive temp agency. I guess he doesn't like to be bored.
Bloomberg reports that the Canadian-Italian exec sleeps only three to four hours a night, often on the corporate jet; works every weekend; and takes only five days of vaction per year. The news service says he travels with a small backpack containing two BlackBerry devices and two iPhones -- one each for Chrysler, Fiat, CNH and UBS, plus a spare for emergencies.
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Posted
Sep 01 2009, 09:49 AM
by
Kim Peterson
Rating:
Money Blog: Top Stocks Blog - MSN Money
 Don't be fooled by the headlines. Yes, the cash-for-clunkers program helped Ford (F) boost sales a remarkable 17% in August from a year ago. It was the first time since 2006 that sales went up for two months straight, The New York Times reports.
For a brief few weeks, the auto industry sprang back to life. People flooded into dealerships, buying cars into the wee hours of the morning and taking advantage of rebates of as much as $4,500. Bing: More on cash-for-clunkers
But as soon as cash-for-clunkers ended, dealerships turned back into ghost towns. “Dealers are saying as soon as the program ended everything stopped dead,” industry consultant John Casesa told Bloomberg. Don't expect next month's sales to be as cheery.
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Posted
Aug 07 2009, 03:54 AM
by
Douglas McIntyre
Rating:
Money Blog: Top Stocks Blog - MSN Money
GM says it will sell 1.4 million cars in China this year. It sold about 180,000 in the US in July. The critical difference between its costs in the two markets is that many of GM’s Chinese vehicles are made in facilities owned by joint ventures with local car companies. Others are produced in manufacturing facilities with low labor costs. And, GM’s sales are growing in China and dropping in the US.
GM’s expenses in it home market may be falling because it has gone through Chapter 11. Unfortunately, the firm’s sales in its home market were down about 20% last month, so its restructuring cost improvements may end up doing little good.
The No.1 US auto company might be better off setting up joint ventures with other large car companies with factories in America to produce its vehicles. Ford (F), Toyota (TM), and Chrysler already have substantial manufacturing capacity some of which is underutilized.
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Posted
Jul 08 2009, 12:04 PM
by
Catherine Holahan
Rating:
Money Blog: Top Stocks Blog - MSN Money
 The models lean seductively over the hood of the 2010 Chevrolet Camaro, wearing only tiny yellow underwear emblazoned with the car's logo. Grasping a wash cloth, they rub down the car until it sparkles as an unseen cameraman asks about the car.
The videos, broadcast on YouTube, use sex appeal to sell Camaros to guys. Only the models aren't women, they're men.
The racy commercials are part of a new advertising campaign targeting gay, bisexual and transgender Americans.
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Posted
Jun 19 2009, 04:01 AM
by
Douglas McIntyre
Rating:
Money Blog: Top Stocks Blog - MSN Money
Toyota (TM) has booked 180,000 domestic orders for its latest Prius hybrid in the first month it has been on the market. There is no reason to think the car will not do extremely well in America. It is considered to be the best hybrid made by any car company and has sold well in the U.S. since it was first introduced.
With the third-generation Prius on its way to America, many of the auto plants of The Big Three are idle and the domestic manufacturers are hardly in a position to produce tens of thousand of hybrids during the rest of 2009. Even if they could, their products don’t have the reputation of the Prius.
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Posted
Jun 10 2009, 08:09 AM
by
Douglas McIntyre
Rating:
Money Blog: Top Stocks Blog - MSN Money
The government was successful when it warned that Chrysler might be forced into liquidation if the Supreme Court delayed its Chapter 11 process by more than a few days. But it's not clear that liquidation would have been a bad result.
Fiat -- which, as part of the group taking over the best of Chrysler’s assets, will become the de facto operating partner -- wrote to the court that if the sale isn't completed soon, "there can be no assurance that a replacement transaction could be structured and agreed that would preserve any aspect of Chrysler as a going concern.” The Justice Department said in its filing that delaying the Chapter 11 process would not be in the best interests of either debtors or the public. It is not entirely clear why that was true.
The arguments for keeping Chrysler on its present path through Chapter 11 have been based, at least in part, on the premise that the car company’s best assets are not worth very much. That is entirely untrue. The company sold more than 79,000 vehicles last month. That was down 47% from the previous year. Chrysler sold over 60,000 trucks for the month.
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Posted
Jun 02 2009, 08:21 AM
by
Minyanville
Rating:
Money Blog: Top Stocks Blog - MSN Money
With General Motors (GMGMQ) Chapter 11 filing, this is a suitable time to discuss what happens to the options when an underlying company declares bankruptcy.
It's traditional for existing shareholders to lose 100% of their investment when a company becomes bankrupt - even when there are assets of value. Stockholders are at the end of the line, and those assets go to others. Think K-Mart: After its bankruptcy, it was suddenly "discovered" that their real estate was worth a great deal of money, and the "new" K-Mart stock soared. The original shareholders were left with nothing.
Call Options Are Kaput
Once bankruptcy is declared, the stock is worthless - and so are all call options. The stock is usually de-listed from the stock exchanges, but continues to trade in the over-the-counter (OTC) market. If you wonder why it trades, or why anyone would pay anything for the shares, those are good questions.
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Posted
Jun 01 2009, 04:35 PM
by
Catherine Holahan
Rating:
Money Blog: Top Stocks Blog - MSN Money
 General Motors' (GM) long-anticipated bankruptcy announcement on Monday didn't send investors running from the markets. If anything, they responded with relief to the news that GM would file for Chapter 11. The Dow actually rose 221 points as the storied automaker wiped out shareholders and erased much of the $172 billion it owed creditors.
But GM's bankruptcy could yet send the rallying market into reverse.
Though the $30 billion in taxpayer money granted by the Obama administration saved GM from liquidation, it didn't solve the automaker's two main problems: too much production, too few buyers. To address those, GM will lay off tens of thousands of employees in the next 30 to 60 days and cause hundreds of thousands more to lose their jobs. Those layoffs, in turn, will likely fuel increases in weekly unemployment claims -- dragging down the economy and potentially delaying any 2009 recovery.
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Posted
May 29 2009, 07:34 AM
by
Douglas McIntyre
Rating:
Money Blog: Top Stocks Blog - MSN Money
Chrysler is well on its way through the Chapter 11 process. The media has pointed out that even if everything goes as planned, Chrysler has a line of vehicles that desperately needs a facelift. The company will also have to deal with the time difference between where the workers are in Detroit and where the bosses are in Italy.
General Motors (GM) has lined up most of the support it needs to enter Chapter 11. With the US government as its primary owner and nearly endless access to capital, it is hard to imagine how anything could go wrong. It is a bad sign that GM’s market share in most of the places where it operates around the world fell in the first quarter. The US was no exception. The No.1 US car company may have to deal with a domestic vehicle market that will only support sales of 10 million units a year and a market share that is below 20% and falling.
One of Ford’s (F) largest suppliers, Visteon, will also make a trip to bankruptcy court. Ford it giving Visteon debtor-in-possession financing. Visteon was a part of Ford until it was spun out in 2000.
Despite that grim backdrop, the No. 2 US car company insists it has the cash to both bail out Visteon and keep its own head above water even with ongoing losses. But Ford admits that trouble with its suppliers could become increasingly expensive. In its last 10-Q the company wrote “it is reasonably possible that our costs to ensure an uninterrupted supply of materials and components could be higher than our present planning assumptions by a material amount.”
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