By on December 7, 2007

ch008_073se.jpgAs GM and Ford entered '07, they swore on a stack of Kelly blue books that they were getting out of the business of churning out hundreds of thousands of crap cars for rental fleets and other bulk buyers. Every month, the domestics blamed their lowered market share and declining sales on this brave decision to turn their backs on churn and burn. Meanwhile, Chrysler did anything and everything to move the damn metal. Prior to the Daimler divorce, the automaker practiced epic channel stuffing (a.k.a. sending cars to dealers and abandoned airfields). And now it can be revealed that Chrysler is picking-up its Motown competitors' fleet slack on a similar scale. Last month, Chrysler told the world its sales had fallen by just 2.1 percent– a victory of sorts in a U.S. market that declined by around three percent. Yes but– CNN reports that Chrysler sent its dealers an internal memo revealing that retail sales fell by 16.5 percent. "In early October, when Chrysler reported its September sales results, U.S. sales chief Darryl Jackson noted that fleet sales were trending down more than 20% and that the decline was 'in line with our plan to reduce daily rental fleet during the second half of the year.'" Well, so much for that, then. In related news, we hear that Ford's honoring its pledge to cut back on fleet sales by giving the job to Mazda, accounting for the lion's share of their Japanese "partner's" reported growth. 

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18 Comments on “Chrysler Fleet Sales Mask Market Share Collapse...”


  • avatar
    Steven Lang

    This is not a big surprise in the remarketing industry. We still have 2006 Chrysler’s that have yet to be put on the pavement.

    Chrysler has the absolute worst interior materials in the North American markets. Most of the interior panels feel as hard as a rock and the switches usually feel and look like cheap hard plastic. Many of their employees say that they were trying to get the feel of the Jeep brand into the rest of the bloodline. But the look and feel of their mainline vehicles is far more downscale than the Grand Cherokee was back in the mid-90’s. I would actually be bold enough to say that even Kia and Suzuki offer the buyer a better look and feel for their products than Chrysler.

    The best example that I can think of is comparing a 1996 Grand Caravan versus a 2009 model. The 1996 is actually a smoother and better looking vehicle with a far higher level of synergy and flow to it. The inteior materials were also far smoother to the touch, and there is a sense of involvement and connection with the road that is largely absent in the new model.

    If you look at it from across the entire product line, Chrysler has lost virtually every market leading position in North America. The profitable and popular Neon has been replaced with the Caliber. The LH sedans have been replaced by the Chrysler Sebring. Even the Grand Cherokee has gone from market leader to market laggard. From where I stand the only saving grace Chrysler has at the moment is the Wrangler… and that won’t be enough for survival.

    I truly love what this company represented back in the mid-90’s. If they were left alone, they could have been a close competitor to Ford in annual sales. Their initial R&D budget and product timeline was far more rigorous and competitive than the one they followed after the takeover. Today, I see a company that was stripped of any competitive virtue by an arrogant automaker that never really gave them the autonomy and resources that were sorely needed. Anyone who thinks that Daimler gave Chrysler the financial and engineering resources to compete is deluding themselves.

  • avatar
    zenith

    Agree entirely on Chrysler minivan interiors.

    My slightly-above-bottom-of-the-line stickshift ’84 Voyager had a very attractive interior.

    The newest Caravans/T&c’s are not up to the same level–especially the T&C.

    The original 1990 Town and Country (based on the same 1st-gen body as my ’84) had a leather interior worthy of the old Imperial; and no ugly hard-edged-looking dash plastics.

    The first-through-third gen vans actually tied to color-co-ordinate interior and exterior while the new ones have 3 shades of light grey plus charcoal.

  • avatar
    d996

    Steven Lang You are absolutely correct. The Germans destroyed Chrysler more than the competition ever did. Now with external factors like high fuel, credit crunch and a weak economy it is up to Cerberus and its much hyped brainpower to pull them out of this mess. I could be wrong but when Chrysler reports around 160 to 170 thousand vehicles sold per month it looks like dealers are only selling about 100k, that would mean fleet is taking up a huge amount of business, and there can’t be much if any profit on those deals. Cerberus is probably trying to figure out how their deal went so bad so quick. The week they closed on Chrysler they thought they had the deal of the century, I saw an article where one of their top honchos had calculated they were in the black in excess of 500 million. Reminds me of the three stooges when they trade their crappy car for an even crappier boat, each side thought they had won but both lost.

  • avatar
    carlisimo

    Funny thing about the increase in rental Mazdas – a couple of people I know were so impressed with theirs that they bought one!

    Haven’t seen that happen with any rental domestic. Probably not because they’re domestic, but because the Big 3 used to have a really, really wide gulf between the cheapest trim level and the better ones.

  • avatar
    timd38

    To quote D996, Steven Lang You are absolutely correct. I rented a Chrysler product last week, and the week before, well, to think of about it, I can’t remember the last time my rental wasn’t a Chrysler product.

    Every time I drive one it justifies why I bought an Acura for about the same money as a loaded Sebring.

  • avatar
    Johnster

    In the past year I’ve had the misfortune of having to rent several cars. I thought the absolute worst was a 2006 Chrysler Sebring, and the Dodge Neon was only a step better. I also had a Ford Focus and a Volkswagen Jetta which were both pretty meh.

    I thought the Chrysler PT Cruiser was O.K. I had a rare low-mileage one, and while it was O.K., the gas mileage was awful and Most rental cars these days really have the miles piled on them.

    The best of the bunch was a Mazda 3. Surprising (to me at least) handling and performance, though the gas mileage was not as good as my Honda Civic.

    And now it looks like I’ll be renting something else next week.

  • avatar
    Blunozer

    Actually, my rental of a Jeep Patriot convinced the wife to buy one.

    She is in love with the little SUV, despite the complete lack of refinement compared to her ’02 Subaru Legacy. Althouth, truth be told, the Jeep isn’t much worse than my ’06 Miata’s interior.

    We don’t mind the interior too much. It’s still functional and all the controls are well placed and easy to operate. It’s also full of surprising little touches, like a rechargable LED flashlight built into the rear dome-light.

  • avatar

    re: rental Mazdas. My co-workers love renting them when we do an on-site customer visit.

    This reminds me of the boom Lincoln-Mercury dealers felt in the 1980s: introducing the base model Town Car brought more retail customers than anyone ever imagined. The media reported that the most vandalized rentals were Town Cars: people took off the rental tags/stickers to make people think they owned it. Too bad we all know how THAT worked out for Ford.

    Man, I do love history.

  • avatar
    taxman100

    Was the 80’s when kids were stealing hood ornaments and wearing them on a necklace?

  • avatar

    taxman: only Caddies and Benzes.

    And the Dodge Ram ornament was a regional hit. My high school’s mascot was the “Mighty Ram” and there were plenty of Dodge chains in class. Great way to show school spirit and disregard for the law right there. :)

  • avatar
    Nopanegain

    Hey Sajeev- only Caddies and Benzes? You are big hip-hop fan; I am disappointed you are forgetting the huge Vee-Dub on Mike D from the Beastie Boys circa 1987.
    One other nitpick: I found the rental (cloth) seats in the Mazda 6 to be so hard and awful, they Hertz my ass. Last time I had the choice I had to go Pontiac just because I hated the base Mazda 6 seat so bad. Now THATS thin padding!

    Hope all else is well in Texas!!

  • avatar

    Oh man, I am pretty disappointed with myself too. I must be getting old.

    I’ll try to re-earn your respect by making a Flavor Flav chain with a junkyard Lincoln/Cartier Chronometer.

    Maybe I can get it done before the NAIAS. Yeah Boyee!

  • avatar
    ronin

    I am starting to see the new Wranglers build up on dealer lots…

    I am hearing anecdotally the days of charging a premium for the 4 door may be past…

    Those who jumped at the chance to buy this ultimate machine may have completed their moves. The opportunity to pay $28k for way sub-par fuel consumption, power, and reliability may be overshadowed by the wealth of practical alternatives.

    I believe Wrangler will be a steady plus for Chrysler, but the big spike in sales over the last year or two are probably leveling off. Cerberus will need to start searching quickly for a new halo star.

  • avatar
    jthorner

    Cerberus bit off more than they can chew.

    The financial press is beginning to get the picture:

    http://www.financialweek.com/apps/pbcs.dll/article?AID=/20071203/REG/71202007

  • avatar
    timd38

    Cerberus is in big trouble. I can’t think of anything they own that isn’t bleeding money.

    I guess the Chrysler headquarters in Auburn Hills will finally be turned into a shopping mall.

  • avatar
    starlightmica

    jthorner:

    Hilarious pic with that article!

  • avatar
    NickR

    The current state of Chrysler is proof that the big brains behind the investment banks and buy out firms aren’t half as smart as they think they. I am surrounded by car enthusiasts, and I can’t think of single one that saw anything but disaster in this merger. Now Chrysler is reduced to selling mediocre cars to fleets in the hopes of staying afloat. Had they been left alone, I am confident that could at least have been competitive. Now they are their death throes…the bankers are rich, the German businessmen are safe, the America bosses will get their golden chutes. Everyone else? SHAFTED.

  • avatar
    speedlaw

    I recently went to a dealer to look at a Magnum. I was interested in the R/T, with R package. The dealer (who was up to his keister in various trucks and Sebrings) looked and could find two within 150 miles, both of which were fire engine red !

    I wanted a big wagon but didn’t want to pay the E class/A6/535xi 60K tag. The Magnum was right in size and price, quasi german, and the Hemi was a big selling point.

    I was told that I could order one, and I’d see it some time after the new year. The lease prices were not very good, as I was told “they really don’t want to lease cars…they don’t want them back”, which I found an interesting quote. Since the leases were not competitive, no sale. I also had qualms buying a car built by workers who knew they were to be unemployed shortly.

    The new MDX in my driveway is really neat…drives almost like the X5, plush like the Q7, built like a Honda.

    Just imagine if they had updated and improved the Magnum, and made an effort to sell them !

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