PTFOA Halves Chrysler Ad Budget

Remember the whole “we do not want to run the automakers” routine? Cue up the laugh track. President Obama’s PTFOA has intervened to halve Chrysler’s ad budget during its taxpayer-funded bankruptcy, reports Automotive News [sub]. Chrysler had requested $134 million for advertising during its alleged nine-week bankruptcy. That request was halved by the PTFOA because that body “believed that it was not feasible to not spend anything on marketing and advertising for fear of eroding the image of the brand,” says Chrysler Chapter 11 consultant, Robert Manzo, in court documents. We knew Chrysler’s DIP budget was being drawn up “in consultation with the Treasury,” but this is the first glimpse of a struggle between Chrysler management and its government paymasters.

According to Manzo’s testimony, the issue was “hotly discussed.” Judge Arthur Gonzalez apparently didn’t understand Chryco management’s burning desire to run its second “New Day”-style ad campaign in as many years, especially on the taxpayer’s dime. He asked Manzo: “idle plants; why market?”

“The belief on all sides was that it was essential for Chrysler not to lose its brand image in the marketplace . . . Advertising and marketing dollars are critical to make sure the right message is out there about Chrysler, what’s happening to Chrysler during this interim period and why Chrysler will be a brand going forward that is one that a consumer should continue to look at as one of their purchase opportunities.”

And so they have $67 million with which to proclaim their bright future of dawning glory. Because that’s the appropriate amount to spend selling a bad idea to your new taxpaying non-customers. Meanwhile, with GM cutting $300 million from its Q1 ad budget, AN [sub] Publisher, Keith Crain, is suddenly asking “Who can forget British Leyland?” That’s right, Detroit’s biggest cheerleader during the rush to bailout is now Cassandra-ing on about the dangers of “government ownership—or direction.” Because taxpayers should be expected to pay Crain’s (and TTAC’s) ad revenue (thanks to the ineffective profligacy of the Detroit midlemen) without second thought or condition? Please. Government intervention is never pretty, but accepting bailout bucks means accepting a certain amount of intrusion. After all, even foolish investments have to be protected. And Chrysler’s “I feel so brand new” moment proves that Auburn Hills still need to be saved from itself.