Daimler Chrysler Close Out of 2006 models fiasco....
12-05-06, 05:32 PM
#1
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Daimler Chrysler Close Out of 2006 models fiasco....
Here's a story about DaimlerChrysler. What a mess. 50,000 undisclosed vehicles stacked up in parking lots. Now they have to unload this stuff.....I hope the buyers get to keep some of the money. This kind of nonsense won't do the resale market of Chrysler vehilcles any good down the road....
Chrysler calms dealers with 'cash'
Automaker reportedly offering U.S. dealers up to $7,000 per vehicle to help clear its swollen 2006 inventories.
December 5 2006: 6:39 PM EST
DETROIT (Reuters) -- DaimlerChrysler AG's Chrysler Group is offering half a billion dollars to U.S. dealers in an effort to clear 2006 inventory, a person familiar with the situation said Tuesday.
Chrysler is giving dealers up to $7,000 per vehicle in "dealer cash" for certain 2006 models, the person said. Dealers can either pass the money on to buyers or pocket it as profit.
The program, offered alongside a new round of rebates on 2007 models, should help ease tensions between Chrysler and its dealers, many of whom have complained about being pressured to order cars they cannot sell.
The U.S. arm of DaimlerChrysler (Charts) reduced its inventory from 647,000 vehicles in July to 499,000 in November, but 2006 models still account for 32 percent of the total.
Chrysler is offering roughly $500 million in dealer cash on the remaining 164,000 2006 models.
Chrysler also has about 50,000 more vehicles in its "sales bank" - previously undisclosed parking lots full of vehicles unassigned to dealers.
The number of such vehicles swelled to 100,000 this year before dropping to about 50,000 last month, Chrysler has said. Last week, the automaker said it was on track to eliminating the surplus by year-end.
The dealer cash ranges from $2,500 on models such as the Dodge Charger to $7,000 on the Dodge Ram pickup and Durango SUV, the person said.
Chrysler spokesman Kevin McCormick confirmed the automaker was offering dealer cash but declined to provide more details. "This is pretty standard practice to help clear out remaining prior-year inventory," he said.
Chrysler this year has been offering the most aggressive incentives of the Big Three Detroit automakers, beating out larger rivals Ford Motor Co. (Charts) and General Motors Corp. (Charts) for discounts.
But some dealers have pushed back, accusing Chrysler of trying to force too many vehicles into its sales channel when it should have been cutting production.
In November, Chrysler offered an average incentive of $4,224 per vehicle, according to industry research firm Edmunds.com. Ford's average was $3,226 while GM's average was $2,539 per vehicle for the same period.
Chrysler also recently launched a direct-mail campaign, offering $1,000 coupons to 3.4 million customers shopping for a new car.
Separately, Chrysler said Tuesday its vice president for sales and marketing, Joe Eberhardt, will leave to return to auto retailing within the U.S. Mercedes-Benz network.
Eberhardt had said last week that Chrysler had no plans to launch new U.S. sales incentives before the end of the year.
Chrysler calms dealers with 'cash'
Automaker reportedly offering U.S. dealers up to $7,000 per vehicle to help clear its swollen 2006 inventories.
December 5 2006: 6:39 PM EST
DETROIT (Reuters) -- DaimlerChrysler AG's Chrysler Group is offering half a billion dollars to U.S. dealers in an effort to clear 2006 inventory, a person familiar with the situation said Tuesday.
Chrysler is giving dealers up to $7,000 per vehicle in "dealer cash" for certain 2006 models, the person said. Dealers can either pass the money on to buyers or pocket it as profit.
The program, offered alongside a new round of rebates on 2007 models, should help ease tensions between Chrysler and its dealers, many of whom have complained about being pressured to order cars they cannot sell.
The U.S. arm of DaimlerChrysler (Charts) reduced its inventory from 647,000 vehicles in July to 499,000 in November, but 2006 models still account for 32 percent of the total.
Chrysler is offering roughly $500 million in dealer cash on the remaining 164,000 2006 models.
Chrysler also has about 50,000 more vehicles in its "sales bank" - previously undisclosed parking lots full of vehicles unassigned to dealers.
The number of such vehicles swelled to 100,000 this year before dropping to about 50,000 last month, Chrysler has said. Last week, the automaker said it was on track to eliminating the surplus by year-end.
The dealer cash ranges from $2,500 on models such as the Dodge Charger to $7,000 on the Dodge Ram pickup and Durango SUV, the person said.
Chrysler spokesman Kevin McCormick confirmed the automaker was offering dealer cash but declined to provide more details. "This is pretty standard practice to help clear out remaining prior-year inventory," he said.
Chrysler this year has been offering the most aggressive incentives of the Big Three Detroit automakers, beating out larger rivals Ford Motor Co. (Charts) and General Motors Corp. (Charts) for discounts.
But some dealers have pushed back, accusing Chrysler of trying to force too many vehicles into its sales channel when it should have been cutting production.
In November, Chrysler offered an average incentive of $4,224 per vehicle, according to industry research firm Edmunds.com. Ford's average was $3,226 while GM's average was $2,539 per vehicle for the same period.
Chrysler also recently launched a direct-mail campaign, offering $1,000 coupons to 3.4 million customers shopping for a new car.
Separately, Chrysler said Tuesday its vice president for sales and marketing, Joe Eberhardt, will leave to return to auto retailing within the U.S. Mercedes-Benz network.
Eberhardt had said last week that Chrysler had no plans to launch new U.S. sales incentives before the end of the year.
12-06-06, 05:48 AM
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Damn that's ugly...It's strange considering Chrysler actually puts out good products overall. Certainly better than it's other big 3 counterparts.
Looking on the street you would think that they are killing in sales.
But I guess it's all incentive based.
Looking on the street you would think that they are killing in sales.
But I guess it's all incentive based.
12-06-06, 05:59 AM
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12-07-06, 10:49 AM
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This is the kind of questionable corporate practice (accumulating inventory in sales banks) that got them in serious trouble in the 70s. Lee Iaccoca fixed it that time and supposedly made sure that they would never do this again. Chrysler richly deserves all its problems, and so does Mercedes for allowing this crap to happen.
.....Doubletake.... 
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