I just saw a brand new Chrysler 200 Convertible in the parking lot and took a few minutes to walk around and check out the much-heralded (by Chrysler) design. Even though the company is still non-public (sans Fiat ownership), I thought I’d share my reactions on the car and its implications for the company, which Fiat CEO Sergio Marchionne seems to think will one day soon be public again…
This commercial from BMW is an awesome F*CK YOU to the UAW and all unions. While the Big 3 were all in bankruptcy and getting federal bailouts, BMW spent a billion dollars expanding a plant in South Carolina. Last I checked, most of these employees are non-union. Oh yea, and BMW – a luxury automaker – is actually profitable, and still was, even during the crisis. GM, Ford, Chrysler, friends (or frenemies) of the UAW? Saved only by the largess and questionably-legal bailout actions of the Government*.
Take a bite out of this: Luxist claims that Fiat management is considering building a Maserati-branded SUV (good!), with a Ferrari engine (great!), in a Detroit plant used to assemble Jeep Cherokees and Dodge Durangos on a Mercedes-Benz M-class platform (wtf?!).
Yes, you heard me right. If Fiat/Chrysler boss Sergio Marchionne has his way, in a few years you, too can pony-up $100,000+ to drive the New Frankencar!
Look: I doubt any Maserati (or GT) purist would ever be caught dead in a Ferrari-engined Maserati SUV – no matter how good the performance – as long as it’s assembled not only in Detroit, but on the same line as the cars the plebes drive, American bread & butter Dodge and Jeep. That being said, the Cayenne is not a pure-bred Porsche. The Range Rover is not a pure-bred Land Rover. Even Bentleys and Lamborghinis are not totally pure-bred these days; the economics of the auto industry (along with the internal politics, management’s egos, etc) simply make it virtually impossible, short of a Bugatti Veyron (itself not 100% bespoke, as Bugatti is owned by Volkswagen Group).
Could this new Frankencar Maserati/Ferrari/Mercedes/Dodge/Jeep SUV become a reality? Sadly, yes. Perhaps not exactly as imagined today, but platform and technology sharing is the reality of the modern auto industry. Hell, if BMW can build cars in South Carolina, why can’t Maserati (Fiat) assemble cars in Detroit, god knows the city needs all the help it can get!
Lastly, this brings up a question automotive enthusiasts have been debating (or rather repressing) for years if not decades: What makes an Italian Grand Touring car an “Italian Grand Touring” car? Designed in Italy? Engine built in Italy? Everything built and Assembled in Italy? What?
I’m not sure where I stand on this topic but considering trends we’ve seen in the global auto industry the past 20-30+ years that show no signs of abating, I think its unrealistic to expect your expensive “hand made” Italian automobile will have all of its parts designed, built, and assembled in Italy. It’s just not realistic anymore, unless you have a bank account and patience like James Glickenhaus, who can afford to have Pininfarina hand-build cars like this:
Fiat/Chrysler Honcho Sergio Marchionne is just as full of shit as his peers at GM were. He claims that the firm’s #1 goal is to refinance their debt to the U.S. and Canadian Governments with private loans/bonds or possibly even an IPO. Perhaps – and I’m just throwing this out there – his #1 goal should be, uh, running a freaking car company…
Remember when GM was prepping the IPO and the rushed re-payment of Government bailout loans? They said the same sort of BS. “We need to repay the Government ASAP because the loans are hindering our financial position.” Right. The generously-granted Government loans that you got after slashing half of your pre-bankruptcy debt are such a huge problem. Not dysfunctional corporate culture, operations, and management. Right…
Let’s be honest here: the ONLY reason GM and Chrysler want to repay the Government(s) is to get Uncle Sam (and whatever his Canadian counterpart is called) off their back and out of their hair. It has little, if anything to do with the burden of extreme debt service. If Chrysler can’t IPO do they really think the terms they’ll receive on private-sector borrowing are going to be more generous than emergency bailout funds from the Government? Please.*
Could Chrysler do an IPO and raise enough money to repay the $7bn it owes the Governments? I haven’t seen recent complete financial statements so I can’t say for certain, but I sincerely hope investors will proceed with extreme caution if they do. Chrysler is not GM (and I dont think GM’s prospects are nearly as good as the rest of the market seems to think they are).
Learn how to read between the lines when company executives talk. It’s a skill that will serve you very-well over time. I promise.