VenSeattle

Things were just starting to look up for Chrysler's upcoming powertrains. The Phoenix V6 will hopefully return competitiveness to the engine bays of Pentastar vehicles, and a dual-clutch automated manual transmission joint venture with Getrag was nearly off the ground before both companies started shoving lawyers at each other. A joint venture plant has been built in Indiana, but the deal fell apart over money for tooling. Chrysler's shot a lawsuit at Getrag, alleging that the transmission specialist hasn't ponied up for tooling and equipment to build the gearboxes. For its part, Getrag contends that it had backing from German banks provided that Chrysler put the $300 million needed into escrow, and is prepared to sue Chrysler to get reimbursed for its investment plus damages. If Getrag and Chrysler can't come to terms, it doesn't look good for the future of Chrysler's clever gearbox which would offer increased performance and fuel economy. Chrysler's statement after the jump



Statement in Response: Chrysler v Getrag

Auburn Hills, Mich., Oct 8, 2008 - On October 7, after months of negotiations, Chrysler filed a lawsuit in Oakland County Court charging that Getrag and its U.S. subsidiary Getrag Transmission Manufacturing LLC misrepresented its ability - and failed to use good faith efforts - to secure financing to support the joint development of a manufacturing plant in Tipton, Indiana, to build dual clutch transmissions, which would be purchased principally by Chrysler for use in its vehicles, in breach of their agreements with Chrysler.
Getrag was obligated under these agreements to obtain debt financing. Contrary to Getrag's representations to Chrysler, Getrag knew that it could not obtain debt financing within the required time frame, and also knew that unless Chrysler was willing to assume significant additional obligations, debt financing could not be obtained at all. Getrag also failed to use good faith efforts to secure the financing. Despite this conduct, Getrag expects Chrysler to reimburse costs Getrag has incurred in connection with the project.

Chrysler brings this civil action to recover all damages it has sustained as a result of defendants' wrongful conduct and to obtain a judgment declaring that it has no obligation to reimburse defendants' costs related to the Tipton plant.

Chrysler is evaluating its range of possible options to meet its needs for fuel efficient transmissions in future products.

DETROIT (AP) - A person briefed on discussions about selling Chrysler LLC says the automaker could be sold in pieces to other companies.

Chrysler's majority owner, Cerberus Capital Management LP, has been talking with General Motors Corp., the combined companies Nissan Motor Co.-Renault SA and other companies about selling Chrysler.

The person said Tuesday night that many combinations are being discussed. The person asked not to be identified because the talks are private.




TOKYO (Reuters) - Nissan Motor Co is proposing to buy about 20 percent of Chrysler and bring the troubled U.S. automaker into the Franco-Japanese alliance with Renault SA , the Detroit News reported on Wednesday, citing sources familiar with the situation.

The offer is now before private equity firm Cerberus Capital Management , which holds 80 percent of Chrysler, the paper said. Citing another source close to the talks, the paper also said Cerberus founder and chief executive Stephen Feinberg still favors a deal with General Motors Corp .

Nissan declined to confirm or deny the report.

"This is more of the same noise and we have no comment to make on any of the recent speculations," Simon Sproule, head spokesman at Nissan, said.

GM, looking for a lifeline to replenish is depleted coffers, has been pushing ahead with talks to acquire Chrysler, people briefed on the talks have told Reuters. Although it does not report financial information, Cerberus has said Chrysler ended June with $11.7 billion in cash.

The Financial Times reported earlier, however, that GM was looking for a large investment from outside investors as a possible alternative to a deal with Chrysler.

Citing unnamed sources, Detroit News said Carlos Ghosn, chief executive of both Renault and Nissan, had sent a proposal in recent days that included revisions to a draft agreement prepared by Cerberus.

Since 2006, when Nissan and Renault studied a possible three-way link-up with GM, Ghosn has held to his position that a trans-continental alliance that includes North America would benefit the existing one. Since forming their equity tie-up in 1999, Nissan and Renault have enjoyed billions of dollars in cost savings every year.

Led by Executive Vice President Carlos Tavares, Nissan has held ongoing talks with Chrysler over the past year that have so far led to three separate projects for the mutual supply of vehicles under original equipment manufacturing (OEM) deals.

While Renault would be part of any partnership with Chrysler, Nissan would acquire the stake because it has cash on hand, Detroit News said. Renault's debts have mounted, especially after buying a 25 percent stake in Russian automaker Avtovaz for more than $1 billion.

Investors, who balked at the three-way talks with GM two years ago, are likely to react similarly this time.

"It's hard to see the benefit when the global auto market is slowing down," Takeshi Osawa, senior fund manager at Norinchukin Zenkyoren Asset Management said. "I'm not sure Nissan can afford to make such a move. It's likely to be negative on its shares."

Shares in Renault were down 4.8 percent in Paris, underperforming the 2.7 percent fall in the CAC-40 index.

Nissan's shares ended down 9 percent in Tokyo before the report, mirroring sharp falls in other auto stocks as the yen surged.




DETROIT (AP) - Chrysler LLC could be sold in pieces to other companies as its majority shareholder Cerberus Capital Management LP seeks to exit the auto business, according to a person briefed on the discussions.

Cerberus, the New York-based private equity firm, has been shopping the beleaguered automaker to General Motors Corp., the combined Nissan Motor Co. and Renault SA and other companies.

Many combinations are being discussed, said the person who has been briefed on the talks. The person asked not to be identified because the discussions are private.

Chrysler spokeswoman Shawn Morgan and Cerberus spokesman Peter Duda declined to comment.

Cerberus's efforts to exit the automobile industry have been widely reported in recent weeks, though speculation has swirled over what shape the final deal might take.

One deal being discussed reportedly calls for Cerberus to hand over Chrysler to GM in exchange for GM's 49 percent stake in GMAC Financial Services.

GM sold a 51 percent stake in its finance arm to Cerberus in 2006. Cerberus also would get an equity stake in GM, hoping to get a good return should GM recover when U.S. auto sales bounce back from a serious slump.

GM is said to be interested in Chrysler for its cash. Chrysler, whose sales have dropped 25 percent during the first nine months of the year, reportedly has about $11 billion available.

It also has debt, but the amount hasn't been disclosed because Chrysler a private company. Cerberus bought an 80.1 percent stake in Chrysler from Germany's Daimler AG in a $7.4 billion deal last year.

Chrysler's cash may not be enough for GM to take on its money-losing rival, though, and the federal government may be involved in an effort to inject cash to prop up the deal.

"All GM really wants out of this deal is the money that Chrysler is sitting on," said John Wolconowicz, auto analyst for the consulting firm Global Insight. "They really don't want any of the rest of it."

Wolconowicz said breaking Chrysler into multiple pieces is a viable scenario, with Nissan-Renault possibly getting a piece of the company. Such an arrangement would make sense, he said, because Chrysler and Nissan are already cooperating on several car-making ventures.

"Nissan has existing agreements with Chrysler that go both ways," he said, referring to a deal announced earlier this year in which Nissan would build small cars for Chrysler, while Chrysler will make a full-size pickup truck designed by Nissan.

Whatever the final outcome of the negotiations, analysts agree that it will have to involve widespread factory closures and layoffs for some of Chrysler's 66,409 employees, resulting in a leaner, more efficient — and significantly downsized — automaker.

Michigan Gov. Jennifer Granholm told reporters in Lansing on Wednesday that a GM-Chrysler merger could lead to as many as 30,000 job losses, with Michigan being hit harder than any other state.

"If GM and Chrysler merge in a way that costs thousands of jobs, it will hurt Michigan, there's no question about it," she said. "If Nissan-Renault is involved, it may be a different scenario."

Granholm said she has been speaking with executives involved, adding, "I think something is going to happen."

Other analysts note that financing for the deal remains a key element to any final deal. Citi Investment Research analyst Itay Michaeli said in a recent report that a combined GM and Chrysler would require at least $10 billion to $12 billion in fresh liquidity.

However, this could pose a problem given the turbulence in the capital markets, Michaeli said, making it "feasible that the government could step in to provide support."

Detroit-based GM is itself burning up cash, going through more than $1 billion per month. Several analysts have predicted it will reach its minimum operating cash level of $14 billion sometime next year.

GM's sales were down 18 percent for the first nine months of this year. The company has lost $57.5 billion in the past 18 months, although much of that comes from noncash tax accounting changes.

If you didn't know all-wheel drive was an available option for the Dodge Avenger, Chrysler Sebring and Dodge Caliber, you're not alone. Only 1.5% of Avenger buyers checked the AWD option box, and the Sebring take rate was an abysmal .7%. The Caliber fared only slightly better at 4.4% for the 2008 model, but that's not nearly enough to keep Chrysler from canceling the option for the 2009 model year. AWD was fast becoming a mainstream option when those models were being developed, but the ability to move all four wheels at once drives down fuel economy. The MSRP goes up, too, and Chrysler and Dodge dealers are having enough trouble selling less expensive base models, much less a $35,000 Sebring with AWD.

While Chrysler may be struggling to sell AWD as an option on its cars, Ford is reporting take rates of up to 20% for the option on the Ford Fusion and Mercury Milan. The Blue Oval says AWD is popular in northern climes, and it probably helps that the automaker actually advertises its midsize offerings' AWD capability. Chrysler is quick to point out that its Borg Warner-sourced AWD system isn't the problem, though, as it's also available on the Dodge Journey, which has a 20% take rate for AWD.

I haven't driven a new Buick in years. One of the things I liked about them was the soft suspension -- even slightly bouncy. Are the new ones still noticeably softer riding than, say, Camrys?

No... Even auto-mags have compared Camry's ride similar to current Buicks. I think the base LeSabre was the last Buick that carried a suspension that could be considered softer than the Camry. However, don't fret. If you liked the previous suspensions I'm sure you'll like the current generation of Buicks... There's less road noise. There's more road feel and steering predictability without any upset to ride comfort.

Can't speak for the Chinese-inspired Buicks yet... I'm waiting to find out myself.

Very nice pics. Thanks for sharing

there will be a bottle of Maker's Mark and some cigarettes waiting back at the apartment.

Good taste... definitely try Woodford Reserve if you haven't already.

I noticed several Jeeps in England. Not so much on the mainland.

We did.

We bought a Magnum R/T and LOVE it. We have had it for over a year, couldn't be happier.

Wow... that's a rare sight... However, I can sympathize with you. I understand being completely satisfied with a discontinued make/model.

Thanks PCS! You even got the color right!

I still think their version of the LaCrosse would have sold better in the US than our own... Oh well, that mistake will be corrected in just a few short months. I'm looking forward to seeing how it all turns out...

As for the plant visit, I don't think I could forgive myself if I failed to take advantage of the opportunity.

A pic of me and my entourage in Italy as God rains sunshine down on us.

Well... I have a few words, but I'll keep them to myself.

Although, I do understand the tattoo/nipple piercing dilemma better...

LOL

I kinda THINK I was talking about the GM/Chrysler situation, but THANKS!

hahaha

But... that's not what you said. LOL

GM has enough bad press all it's own, and with the economy turning BAD it is THREE American automakers in dire straights.

It seems too many here turn a blind eye to that.

This rumor IF realized will REDUCE domestic automobile production and the jobs that come with it, and further reduce the public's perception of a domestic automaker. Like it or not.

No domestic has been "absorbed and dissolved" yet. Have they?

Yes they have... several times. Too many times to count. Just pretend to know history. Okay?

By the way... the reduction will happen regardless of this acquisition. Chrysler is collapsing under its own weight and Cerberus knows it can't save it in this market climate. Why else would Chrysler be pawned off by Cerberus after just a year of ownership? That's the reality.

GM and Ford are suffering from a similar situation, but have global operations to fall back on. Even if NA operations go bankrupt, the international operations can step in and assume management in the reorganization. Yes, I know the financial mess has traveled globally, but you can't assume the results in the US are going to be the results elsewhere. Factors are different. Each region needs to be managed separately.

For GM to even TRY to absorb Chrysler, as you say, when the consensus is there is no good reason- and then try to PRETEND that it is a wise move? Wow. No wonder GM stocks are dumping to 60 year lows, management is still involved in crazy risk taking despite being in dire financial straights.

Looks to me a like a sign that things are going to get even WORSE at GM, and the financial troubles at GM are already staggering.

You do the math. It's NOT good.

But... But... But... aren't you the one who's been telling us for the past week that this is just rumor mill and media spin? Did you just catch up to the rest of us? We've been seriously gnawing on this situation for a while now while you've been in denial. We've been saying for a year that Chrysler was in the worst position of the Big Three while you've been trying to convince us we're wrong. Who's had "Automaker blindness"?

Be glad someone is even considering them in today's climate. If I were GM or Nissan-Renault, I'd just step back and let them collapse.

There, you were missing a step...

Evan a bankrupt company has an opportunity to recover. An absorbed and dissolved one? Eh... not so much.

Even though I can conceptualize the absorption of Chrysler, it doesn't mean I agree with it. I'd rather Cerberus turn Chrysler around or die trying. Well, at least be the one responsible for killing Chrysler. GM doesn't need the additional bad press.

Why couldn't the Ram be offered under JEEP as long as it's viable? Throw a JEEP grill on it and call it a day.

summing things up... this the plan? -

1 ) GM takes the money.

2 ) GM immediately eliminates white-collar redundancy between GM and former Chrysler LLC.

3 ) GM immediately stops all future product development for the Dodge, Chrysler, Pontiac, and GMC brands.

4 ) GM continues Jeep product development.

5 ) GM lets the Chrysler/Dodge/JEEP (CDJ) dealers wither and reduce their number by natural selection.

6 ) GM uses Chrysler minivans and plants to develop and produce (competitor) GM brand versions (circa 2010 debut-probably Chevy & Buick (GL8/Terraza replacement for the US & China. T&C equivalent-possibly keep the name too)

7 ) GM uses Chrysler LX/LY platform and plants to develop and produce (competitor) GM brand versions (circa 2010 debut-Chevy, Buick, & Cadillac versions)

8 ) GM uses Chrysler's hybrid technology and integrates it into GM platforms and brands.

9 ) GM slowly shuts down former Chrysler LLC plants as demand dries up for the various vehicles produced.

10 ) GM offers JEEP at remaining BPG dealers (between 2009-2011.)

11 ) GM offer Buick(new Buick LaCrosse, Regal, and Enclave) and Saturn through remaining CDJ dealers (between 2009-2011.)

12 ) GM offers Saturn at remaining BPG dealers (between 2009-2011.)

13 ) GM begins the phase out of GMC, Pontiac, Chrysler, & Dodge (between 2009-2012.)

14 ) Buick-Saturn-JEEP dealer chain completed around 2012.

Technically, isn't Saturn getting the Opel Insignia?

Although elsewhere has stated that it will feature different styling and interior, and if that's the case, what is the point to all of this?

Saturn Aura = Different exterior & interior = different car than Insignia.

Buick most likely will NOT get the Insignia stateside because another brand will already have it and I don't think that Buick needs two Epsilon cars of the same size.

They are not the same size. The Insignia/Regal is on the SWB Epsilon II platform. The LaCrosse is on the LWB Epsilon II platform. Think of this in terms of the Acura TSX and the Acura TL. Same platform. Different Dimensions. Different car.

Chrysler should be treated with less criticism for a while especially after they were treated like a stepson for almost a decade. I think the company deserves a second chance for a couple-three years till their products start showing up under new design chief. I hope it survives till then.

Great! Are you willing to go out and buy a new one right now? That's the problem. Regardless of the "respectability" Chrysler deserves, it's still lacking class leading products (or in some cases, any product at all) in most markets. That will not allow Chrysler to maintain credibility or market share until it can come out with more competitive products.

Uhm... well... Let the healing begin?

Better get used to it, because that's all we'll be hearing for the next several months following the election.

No way is GM going to keep Dodge and Pontiac as they compete for the same type of buyer. I doubt either will survive since GM is moving away from brands that are only based in North America as Dodge and Pontiac are.

So, do you see a three-channel sales strategy?

Chevrolet-Chevrolet Trucks

Buick-Saturn-Jeep

SAAB-Cadillac

GM should just treat Chrysler like Daewoo... wait for Chrysler to fall apart (if it actually happens) and then buy the pieces it wants. Either that or just let Nissan/Renault deal with it (which is what I think will happen.)

I believe the topics in question have been restored.

There are a number of cars that overlap the Lucerne's price range as much as the Lucerne overlaps the price range of many of the vehicles you have listed. e.g. Accord, Camry, Altima, etc. They offer the same level of "luxury" as the Lucerne (or certainly are more comparable than many of the cars you listed) and outsell it easily, sometimes several times over. That is as fair a comparison as what you are doing.

I can't imagine the BMW 3-Series being considered a direct competitor with the Lucerne. I'd love to see the stats, but I imagine the number of people seriously cross-shopping a BMW to a Buick are non-existent (like the RL's sales). Perhaps some people who would buy a Buick got lost and wandered into the BMW dealership, but BMW owners are not generally looking at Buicks.

I think of Cadillac as comparable to some of those cars. But Buick is in the same league as a Honda/Toyota... just for older people. For example, I will consider a BMW 3 series for my next car, I will even consider a CTS, but Buick isn't even on the radar.

Eh... wrong, wrong, wrong...

The Camry, Accord, and Altima etc (mainstream midsize sedans) lack several features that the Lucerne has available and are not comparable in "luxury" to the Lucerne by any definition (whether you define it by power, NVH levels, available options and features, warranty, size, fit'n'finish, quality of materials, or a combination of such). Transmissions do not make a luxury car (if so, then ACURA is even behind Buick since the Enclave has a 6-sp.) Hybrid versions do not make them a luxury car either, unless you believe the Malibu Hybrid should be positioned over a CTS. Isolated '0-60' figures don't define a car as luxury or the Cobalt SS would be a god right now.

I stated it in the original post and I explained it again in my response: I added BMW in for SMK's benefit since he has a very long history of actually comparing Buick sales to BMW sales. I never have or will call the 3-series a direct competitor to the Lucerne. By saying "Lucerne's direct competitors were the ones I'm actually interested in" it indicated the cars that mattered (as far as comparisons were concerned) within the list were the ones considered (by the market) as direct competitors... if you're actually that unfamiliar with Lucerne's direct and indirect competitors, I can highlight them in a future post. Would that help?

GM bought the RenCen with the intention of reselling it at a profit and then continue leasing it. I doubt they planned to do it so quickly though. I agree with CSpec... they wouldn't flip the property so quickly if there wasn't a good reason.

Well, I have only voted for a major party candidate once - so that's not really at issue.

But, I have a bad feeling about the next few years and want to give this decision my full consideration.

I really believe it matters this go 'round.

Well, I'm different since I've only voted for major parties. Yes, I know I've become one of those who fuel a broken system. I really thought I didn't have to worry about it this election considering how the past several years have been... But, oh well, both parties have let me down… One more so than the other. Depending which one wins might determine if I decide to invest effort into endorsing another party that better represents my perspective.

Certainly.

A friend of mine is actually going for the write-in option. He's just too devoted to Hilary. He wishes to wear his Hilary mask and "got experience?" shirt while voting, as well.

I haven't really declared my position, but I'm sure who we both will not vote for are one in the same. Just ask Chris.

I like your friend already and I haven't even met him.

No vote cast is ever a vote thrown away if it represents what you believe.

I'm willing to accept certain compromises in hope that certain things come or don't come to pass.

Now is not the time to switch to a non-dominant party if your beliefs are that strong. That switch should come at a time when you can support the minority-party and assist to make aggressive decisions in preparation of the next election. If you haven’t done so already, then you’ve waited to see what the two dominant parties were going to provide. We all get what we wait for.

Unfortunately for me, I had two people in mind (one for each major party) and neither made it to the ballot. Such is life.