Chrysler in the Dead Pool?

Like a wilted rose sitting in stagnant water, this blog has been long neglected. Call it my time has been occupied with gainful employment or that my focus has been centered someplace else other than the pages on this website, I have no excuse other than my mind has been elsewhere.

Let’s just say that since the last post, the automotive world and economy have seen some drastic changes. It’s hard to put a finger on a single-source to fault for the recession/depression, but two glaring themes ring true, greed and poor judgment had much to do with the current state of things. Here in the states, we are seeing ever-increasing unemployment rates, and every time you open the paper, it is not uncommon to see stories of Company X laying off employees or even municipalities closing doors on social programs and the like (at least here in Orange County, California).

To summarize things, car sales are at record lows, the American automakers got their government loans and now it’s a matter of time if the CEO’s each can pull Ford, GM, and Chrysler out of the muck. I personally see glimmers of hope with both Ford and GM, but since Chrysler went private after Cerberus Capital took over the company in mid-‘07; their current financial state is only left to speculation. I strongly believe that things are not rosy for Chrysler, unless some cash can be infused into the company by a buy-out offer from Nissan, a merge with GM, or some other offer, I predict Chrysler won’t be around in another 10 years or so. If we take a look back to almost three decades ago, Chrysler faced a similar fate (though the lone player in the near-bankruptcy ring back then), one Lee Iacocca took Chrysler off of the banks’ black list, with the help of a government loan signed by then-President Carter, by introducing a core product line that brought the company record sales and single-handedly changed the American car market, I am talking about the Chrysler K-cars and more specifically the Dodge Caravan and Plymouth Voyager minivans. The K platform allowed Chrysler to essentially take a single chassis, stretch it to a certain degree to suit a multitude of body styles, but keep costs low by sharing common parts such as suspension components, engines, and transmissions. The Caravan and Voyager were wildly popular when they debuted back in late 1983, the same cannot be said today as minivans account only 4.7% of total vehicles sales (as of September 2008) down from 8% back in 2000. The minivan may soon be dead as crossovers offer a cooler mode of transport while being equal in terms of utility. Unless, Chrysler can hit another home run with another revolutionary product, the money lent is only buying Chrysler time and could be written off as a loss without some much-needed angel financing.

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