Daimler Chrysler: When Bad Cars Beget Bad News
It has not been the happiest of Valentine’s Days in the community where I live. A crippling ice storm would freeze the most passionate lover’s kiss, while word came from Detroit that our Daimler Chrysler assembly plant will shut down after 55 years.
The plant, which makes Dodge Durango and Chrysler Aspen SUVs, will remain open until 2009, but will soon cut back to a single shift, eventually leaving in the lurch 2,100 employees and another 895 people who work for local suppliers.
Everyone knows someone who has worked at the plant, a linchpin of the community that made Pershing tanks for the Army beginning in 1952 before converting to truck and then automobile production.
The closing is part of a massive Chrysler restructuring that follows record losses in 2006. Chrysler will eliminate 13,000 hourly and salaried jobs in all, or about 16 percent of its 82,500 employee global work force.
Anyone who has had their finger on the pulse of the American automobile industry could have seen the closing coming.
While Chrysler’s fortunes briefly rose after being taken over by Daimler, which makes the Mercedes brand, it shares many of the same fundamental problems as do General Motors and Ford:
Boring product lines that lack the sizzle and economy of the vehicles (also made in the U.S.A.) by Toyota and other Japanese manufacturers, and a failure to foresee the collapse of the SUV market and increasing demand for hybrids.
The Chrysler fleet has seemed especially out of step to me: flashy and derivative pimpmobile stylings that seem like caricatures of themselves.
Our local plant remained open as long as it did because of its reputation for building vehicles with fewer assembly-line defects. Too bad that the guys with the big offices in Detroit forgot how to design and sell them.
11 Responses to “Daimler Chrysler: When Bad Cars Beget Bad News”
I used to think there was something to be said for “buying American” but not anymore.
Not only will Toyota likely employ more Americans than GM, Ford or Dodge in the near future, they also design better cars in a lot of respects. We should have left their brands in droves years ago, maybe they would have learned their lesson.
The good times by the ‘Big Three’ was do to the American public buying large pick-ups and suv’s. Nowhere else in the world is there a market for ‘city folk’ to buy what used to be ‘work vehicles’. Because of lobbying and loop holes CAFE standards didn’t apply to trucks. TThe AMERICAN public was the major consumer of these monsters. If gas didn’t spike to $3.00, the American public would still be in love with the Durango and Suburban. Don’t see SUV’s in the EU.
The Jeep Liberty is an excellent, well-designed, and robust vehicle with a good quality record and good customer appeal even in the post-SUV market. Perhaps it is hasty to condemn the entire Daimler/Chysler product line across-the-board.
Jason:
Point well taken, but the Liberty is no more going to save Chrysler’s bacon than an equally outstanding vehicle, the Corvette, is going to save GM’s.
“The Chrysler fleet has seemed especially out of step to me: flashy and derivative pimpmobile stylings that seem like caricatures of themselves.”
Good point! While I think the designs aren’t boring, even unique, I always wondered if this really is the taste of the mainstream American.
:-/
Personally most manufacturers have bugaboos, the japanese tend to just have fewer. But, here state side, management and unions made some crazy deals way back when competition was not so tough. Now US manufacturers are saddled with something like 1500-2000 more per car in benefits they owe than the japanese. Needless to say that cost comes out of things like interiors and what not.
What really needs to happen (good luck) is that unions need to take a real slap upside the head and realize that assembling a car is simply simply not worth more than the $15 – $20 hour that Toyota/Honda/whomever pay their US workers. Ditto 401Ks instead of pensions, and healthcare they kick in for too.
Management needs to get their heads out of their collective butts and start realize that people actually want quality product such as is delievered in Europe and even China (Buick equals good there). Thnakfully, GM has done wonders this way very lately with the newest Saturns, the Buick People mover (7 seat cross over), pontiac G8 and so on. DCX, not so much.
“What really needs to happen (good luck) is that unions need to take a real slap upside the head and realize that assembling a car is simply simply not worth more than the $15 – $20 hour that Toyota/Honda/whomever pay their US workers. Ditto 401Ks instead of pensions, and healthcare they kick in for too.”
All reports in German media say, not high costs of the work force are the problem, but lousy sales. Chrysler simply isn’t able to sell as much cars as it can produce. Every factory who’s not working at full capacity is a liability. Don’t forget that Chrysler already had made the turnaropund into profitability, when the new oil price shock hit them hard. And this happened to GM and Ford as well. Now it shows that it was a huge strategic blunder that neither Chrysler nor Mercedes have hybrid technology ready for the market. Mercedes can survive this for some time, because in the luxury segment, gas prices aren’t that big a factor, but Chrysler loses too many customers to Toyota and Honda.
However, on a personal level, and while I don’t really like the 50′s retro design, I can’t understand why a hot car like the Crossfire isn’t a huge success on the American market. What’s wrong with that cutie? I would love to have it.
“The Jeep Liberty is an excellent, well-designed, and robust vehicle with a good quality record and good customer appeal even in the post-SUV market.”
Sure. But a friend of mine sold his Jeep two years ago and bought a VW diesel (Touran) van instead because the exorbitant gas consumption totally p***ed him off.
:-/
15-18 mpg. Its not great (newer models are better), but “exorbitant” it is not.
It isn’t exorbitant, but, that is claimed mpg isn’t it? Sticker mileage so to speak. So real world I’m guessing it is less than that. So assume 13mpg in the city 17hwy. Compared to a diesel, yes it was exorbitant, compared to a similar sized/equipped suv, probably not. We have a Nissan Xterra, pretty similar vehicle, same gas mileage ratings. We’ve rarely gotten that. Compared to my motorcycle or miata, it is exorbitant, therefore it is our extra vehicle.
Though I thought they made a diesel liberty, or were planning to. Couldn’t find it on kbb.com though.
You are correct newer ones are claiming 17-22.
“So assume 13mpg in the city”
That’s about what my friend said. And that’s exorbitant considering german gas prices. Almost nobody here would buy a car that’s so uneconomic.