Wild Ass Rumor of the Day: Deadbeat Chrysler?
TTAC has confirmation from three trusted, independent sources that Chrysler is delaying payments to its suppliers– to the point where certain suppliers have refused to ship parts until the embattled American automaker settles its bill. Even so, we are filing this report as Wild Ass Rumor because none of these sources will go on record. (Hardly surprising consider the economic self-interest involved.) It is equally true that there's no way for TTAC to accurately gauge the full extent of Chrysler's delayed payment situation. IF, as we suspect, Chrysler's owner Cerberus is readying to file for C11 during its company-wide summer holiday, or, as some suggest, preparing for the long-delayed "strip and flip," delayed payments would indicate, at best, ChryCo cash flow problems. We invite both Chrysler and its suppliers (guaranteed anonymity) to use the comments section below or contact us via email to clarify this issue.
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Slowing payments could also be part of the whole cost savings at the expense of the supplier strategy. Just like that magic 25% cost reduction goal, Chrysler simply thinks the suppliers need them so much that the suppliers will go along with whaever they dole out. Walmart and Home Depot are notorious for this and I don't see either headed for Chapter 11.
"Their new cars are quite bad b/c they are so in debt" Bah humbug. The redesigns stink because the managers who directed the projects were bad at their jobs, simple as that.
As a high school student in the '70s, robotic manufacturing was going to be the next wave in the auto biz. The fear of some was the displacement of live people as workers. Now the fear is elimination of whole companies. It gives me pause to consider what other huge social shifts I may be missing now in '08.