Chrysler: No Market-Share Miracles
Chrysler CEO Sergio Marchionne isn’t bothered by his firm’s sliding market share, which have declined to the point where Honda will certainly surpass them to become the number four automaker in America. At least that’s what he keeps saying, and Automotive News [sub] went ahead and made it a headline. If dealers are “expecting us to call them up and give them a $6,000 check for every new vehicle, they won’t get the call,” Marchionne joked recently in the Detroit Free Press.
Too bad then, that Marchionne’s humor relies so heavily on exaggeration. The ugly truth is that ChryCo still isn’t close to weaning itself off of incentives. Sure, Chrysler’s offering less cash on the hood this month than last, with Edmunds reporting average incentives falling from $3,753 to $3,298. Still, the industry average is $2,713, and Honda has passed Chrysler with a mere $1,195 average incentive. Meanwhile, Marchionne keeps telling AN [sub] that “we are not planning miracles at Chrysler.” And yet, the firm is losing sales and maintaining incentives, while projecting an operating profit break-even next year, and net profits the next. If that’s not a miracle of Christmas after-school-special proportions, it’s hard to say what is.
More by Edward Niedermeyer