The man this week is yet another German. Probably just because the Hoff kicked SO much ass last week that the whole country’s status improved. This week however it is…
Dieter Zetsche a.k.a Dr. Z is the CEO of DaimlerChrysler and managed a wicked burn this week by unloading the money losing Chrysler Automotive Group on a company called Cerberus for $7.4 billion. Sure you could say it wasn’t that much of a hustle since Daimler/Benz paid almost 36 billion to get their paws on it in the first place, but you’d be wrong.
Think of it this way. First, Chrysler has been in the hole for quite some time, there was hope in the early 90’s when they teamed up with Mitsubishi and rolled out cars like the Avenger, Stealth and Stratus. Plymouth was still in the game and had a few decent cars, the Dodge Ram was the truck to buy, the Durango was looking to kick off the transition from minivans to suvs, Jeep still made quality products and though only purchased a few years prior, Chrysler had managed to turn AMC motors into Eagle and released such beauties as the Eagle Talon and Vision. Then in 1994 Dodge released the Neon and tried to convince the world it was THE car to have. The sad part…the world bought it. Soon, the Eagle and Plymouth lines were disbanded, the Avenger and Stealth would be pulled out of production, the Durango would change from being looked at as a rugged utility vehicle to nothing more than a kid hauler and perhaps worst of all, Jeep started to take a dive. In steps the Germans in ’98 boasting the power of Daimler/Benz and claiming they have the power to save the dying giant.
At first things looked all right. New concept cars were being rolled out, the Ram was firmly at the top of the truck heap, the Stratus was redesigned as more of a sports car, the Sebring replaced the Le Baron as the affordable convertible and even Jeep looked like it was going to get its balls back. It really seemed like these Germans knew what they were doing. Ah, but they forgot one thing. They forgot how stupid Americans can be and how much we love kicking ourselves in the ass.
The Neon that Chrysler AG pushed so hard was everywhere and worst of all people still wanted them. Why? because they were cheap, when most vehicles that are only 3 years old can still fetch a decent amount of resale, a three year old neon was only worth about $4,000. So of course this meant people buying them up and “tuning” them. As the Jage says…you can’t polish a turd, but they still weren’t disappearing at a fast enough rate and Dodge couldn’t give new ones away.
Then of course you had the unions in there, namely the UWA demanding insanely high wages for the memebers of their communist…I mean competitive organization and demanding the Daimler continue to pay the pensions of all the retired autoworkers. Rumors started to fly as early as 2001 that Daimler was going to pull out, but they squashed those rumors with their own rumors. Talk of a ten cylinder motorcycle and the rebirth of a legendary muscle car were enough to shut everyone up for a few years.
Finally in 2004 it was announced that the Charger was going to be coming back to life. After a few concept versions, the game was on. Muscle car fanatics around the world were sprouting wood. Not to mention other concepts such as the 300, the Nitro, the Crossfire and the Dodge Ram SRT were all either already in production or about to be and causing plenty of talk on their own. Sure the Neon SRT was an outright bomb, but who is going to pay over $15k for a new neon in 2004 when they can get a 2000 for less than $3k? I mean don’t be silly. Then came the day that the charger was revealed. The chubs went limp.
The Charger was expected to go up against the new GTO and the redesigned Mustang, but it was nothing more than a sedan. There was nothing muscle about it. The GTO simply out performed it and the new Mustang captured the spirit of American muscle all the way. To be honest the Charger was nothing more than a 300 or Magnum with a slightly different body style. It was a massive disappointment almost to the level of Ford’s new retro styled Thunderbird had been a few years before. This combined with the poor sales of the Crossfire, destroying the rep of the Durango so much that in its final production year it was nothing more than a minivan and of course ruining Jeep with the Liberty meant that Chrysler was cut deep and bleeding money.
Now this is were the true genius of Dr. Z steps in. he not only managed to convince a private financial firm to purchase the company, but to agree to continue paying the pensions and salaries of the employees, while still maintaining almost a 20% stake in the company in case they are able to turn it around.
If it were me I would seriously consider rekindling the Diamond Star relationship with Mitsubishi, canning all current production lines, launching two true sports cars, a luxury car, a rally car, a family sedan and a muscle car. In other words, release the rumored Challenge, but do it right as a muscle car; redesign the 300 to take on Cadillac and Lincoln; make the Viper in a price range to compete directly with the Corvette and design the new Avenger to compete with the euro sports cars. Finally put an awd vehicle into production that competes with the Lancer and WRX. I would probably leave the truck line alone and ditch every Jeep that wasn’t a Cherokee or a Wrangler, but hey…that’s just me.
If you got a problem, ask Dr. Z