By on November 5, 2009

Interesting that 2009 is the trough year...

This graph is representative of a major assumption underlying the entire Chrysler Group turnaround plan: namely, that 2009 is a trough year and that (despite the lack of new mass-market product until 2012) 2010 will see Chrysler not only holding the line on plummeting sales, but actually increasing them dramatically. Where does this optimsim come from? In part, a projected rise in SAAR. Otherwise, the only rationale for this assumption is that the financial plan requires this kind of short-term growth to succeed. [Apologies for the giant images… like Chrysler, we’re doing what we can with what we have]

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22 Comments on “What’s Wrong With This Picture: Planning Sales Edition...”

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    Sometimes when your instruments show that you’re going to crash, it’s actually happening. Every pilot who’s flown a plane into the ground had a similar curve in mind as the plane went down…

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    They’re like the guy who fell into a well and devised a plan for getting out: “First, assume there’s a ladder…”

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    This is exactly my problem with the whole thing. “We’ll have imaginary refreshes and imaginary new products at some imaginary point in the future. Meanwhile our sales will inexplicably grow in advance of this.”
    Basically, the entire plan is “we will eliminate some vehicles and add other vehicles until we have one product in each segment. People will buy these in increasing quantities. Thank you very much.”

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    Chrylser can point to it’s optimistic plan when appealing to the Obama administration for an additional round of taxpayers funds.
    Chrylser(55% Union owned according to WaPo 11/5/09) has a product plan and the US government will invest in it. See, that’s how capitalism works according to current progressive thinking.

  • avatar
    Frank IBC

    What’s really funny is that the alleged recovery is strongest while they still have all the old models, but starts to level off just at the time the all new models are supposed to be rolling in.

    Must be those nifty dashboards.

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    If you follow their bouncing ball, not only do they expect sales growth based on SAAR increasing from 10m to 14m (which for them would be +360k in additional units if they hold their 9% share…But, they think they are going to GROW their share to 13% by 2014 and add an additional 200k units on top of the +360k!!

    2 questions
    –who are they stealing this share from?

    –what is in that espresso machine they use?

  • avatar
    John Holt

    Clawing back 5% of market share is a monumental task, one that evidently is grossly underestimated by Fiatsler’s brass. They’ll be damn lucky to maintain the eroded market share they have currently unless they pull new product out of a dark crevice.

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    Jeez guys- it’s simple logic. They like selling cars, and the little bars are getting taller, therefore they’ll sell more cars.

    One word: cool extrovert.


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    Blah Blah Blah They’ll never ever ever ever never never pull this off!! Bwahahahahaha! Their cars are so bad Chevy Chase can pull off jokes about them Bwahahahaa!

    These Italians mean business, and in the short time since their arrival, they’ve laid it all out except pictures of, and exact product specifications.

    My question is thus: How many 2012-2014 products do we know everything about? Are we calling shenanigans on the companies we have no information about?

    Lets use Mitsubishi as the example. I don’t personally know what their product plans are for 2014. That I have no interest in, and am unaware of their product pipeline means that they have nothing– squat– zip, and zilch too.


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    “Total units sold more than double from ~1.3M in 2009 to ~2.8M
    in 2014 with growth in all geographies.”

    Well there’s your problem, right there! (On the first page with actual content, at that.)

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    This is the scariest graph of all. That line for market share–incredible.

    Do they really think that their “improved” marketing and packaging will have that large of an impact?

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    It’s clear at this point that Mitsubishi is an immortal zombie. Nothing can kill it until Japan finally forces its banks to clean up their balance sheets and bad loans. Which might never happen.

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    Any other company that showed graphs of fantasy market share explosions and exponential sales growth would get the same treatment here.

  • avatar
    Mr. Sparky

    Phase 1: Collect Underpants Make Powerpoints
    Phase 2: ?
    Phase 3: Profit

    Obviously, Fiat has put the South Park Underpants Gnomes in charge of Chrysler.

  • avatar
    Mark MacInnis


    Hey, if realistic assumptions stand in the way of your plan, simply replace them with unrealistic assumptions….

    Marchionne apparently presumes he can repeal the law of gravity as well.

    Hey, what the hell, Fiat isn’t putting any money into this, they are playing with house (taxpayer)money. Might as well sit in on a few hands in the game. If their assumptions don’t pan out, they can always throw in their cards and walk away…..losing nothing but a little time.

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    Mr. Sparky – you beat me to the underpants gnomes punchline. So relevant here in so many ways.

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    Putting lipstick on their existing models with a few changes regarding fascia won’t grow market share in 2010 – 2011. It’s pretty clear that except for a new Gran Cherokee, not much will be coming out of the pipeline before 2012.

    Hypothetically – if Chrysler Dodge Jeep sales fall another 20% in 2010 – more of their dealers will be closing their doors.

    Also, there is no guarantee that a rising economy in 2011 will automatically raise all boats, especially if wages and jobs will lag previous recoveries.

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    Optimism, guys.

    This is not the hopeless company many present it to be.

    Was Chrysler’s market share not around the ‘hopeful’ numbers presented here just a few short years ago– right before the cost-cutting and suicide-style product development bonanzas the Germans enacted?

    If they simply freshen product, add some sparkle in that process, continue introducing new product, stand behind this product and market to those ends, is this really so far-fetched?

    It really isn’t. Trust that there is pent-up demand for the return of high-blue collar-style to Chrysler and Dodge. The next renaissance will follow. That’s how it works.

  • avatar
    Mr. Sparky


    Trust that there is pent-up demand for the return of high-blue collar-style to Chrysler and Dodge.

    I don’t have that trust because of a company by the name of Ford. Ford managed to stay away from the bailout stigma, is rolling out a new product line, and is being showered with love from Consumer Reports on the reliability front.

    Those high-blue collar-style buyers are a key Ford demographics, and as a group, are not bailout fans. Much of Chrysler’s lost share has turned into Ford’s gained share.

    To believe that people will revert back to Chrysler after tasting Ford or the imports takes alot more trust than I’ll every have.

  • avatar
    George B

    Chrysler would have to do something dramatic like when they created the minivan or gave the Ram big rig styling. Without a new got to have product I don’t see increased market share for Chrysler. As I see it, Hyundai and Kia are taking over the lower price end of the car market that Dodge used to occupy. Hard to see a Chrysler increase in market share when Hyundai and Kia are aggressively going after the same buyers.

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    Ford had a leader come in and shake things up, and mortgaged the hell out of the company. There were several products in design when he showed up. Chrysler has little in design, can’t leverage any money, and has suppliers shutting down assembly plants because they are not getting paid. the only thing Sergio did with his mind numbing boring presentation was confirm what everybody already knew, they’re screwed. Who are they going to steal market share from, Ford, who has a two year headstart? GM, who will continue to muddle along for a couple more years? Maybe toyota will roll over and give up some share. Honda most certainly will. How about the koreans? I hear they are all for Chrysler surviving. The industry has about 3x capacity based on today’s purchasing rate. That means we could shut down 2/3 of today’s assembly plants before the business will get healthy.

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