Chrysler Blood in the Water Draws Sharks
Shark number one is Ford, which is making a concerted effort to steal sales from its cross-town rival. Automotive News [sub] reports that Ford is rolling out a regional incentive program aimed at existing Chrysler owners. Ford is offering Chrysler owners an additional $500-$1,000 on the purchase of a new Ford to owners of Chrysler vehicles older than the 2006 model year who have had service work done at Ford dealerships in the past three years. However, Ford is keeping the program as targeted and low-profile as possible. “We’ve been very cautious and certainly not predatory with regard to this,” say Ford spokesfolks. Which is smart. Domestic buyers seem to prefer other domestics, and Ford can only benefit from the uncertainty surrounding the other Detroit firms. Still, Ford should probably consider sending Chrysler owners an update on ChryCo’s attempt to welsh on its legal liability. Meanwhile, Automotive News [sub] reports that Ford is increasing production, as it angles for Chrysler’s declining market share. Toyota is, too, says AN [sub]. Let the feeding frenzy begin!
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As it should. Capitalism is alive and well. Great news.
Dave: Ford has done the painful deeds that the others wouldn’t, and what’s their reward" Well let's see. They borrowed a bunch of money before the credit markets collapsed. How hard is that? And they borrowed so much that they put themselves at risk - unless they plan to use Uncle Sam'o(bama) as a safety valve. They have not closed dealers (just normal attrition which everyone was doing before BR). They haven't told the Unions to FO and die. In short they haven't done any of the things the B&B here have recommended. "Ford is offering Chrysler owners an additional $500-$1,000 on the purchase of a new Ford" See response above. How can Ford afford to do this? they are not making a profit. They have to pay interest on that money to their lenders - unless we (taxpayers) turn into their lenders.
It shouldn't be "welsh" on a deal. It should be "Welch" as in Jack Welch, former GE CEO who didn't hire Nardelli to replace him. Nardelli thought it was a done deal, so he went away, wound up a Home Depot and the Chrysler. Hence, "Welch" on a deal. Well, not really, but close enough for me, and it keeps the vowels in Wales where they are most needed.