Volume II, Issue 4, Page 3

Chrysler Musings

Get A Scorecard

OK. Fasten your seat belts and make sure the airbags are functioning. We’re going to jump around various Pentastar items because there is so much going on with the brand you need a scorecard to follow it. We might even glance off a wall or two.

Crossfire Snuffed

The unloved Chrysler Crossfire is being put to sleep because of poor sales. Its SRT-6 version has already been stopped, but by the summer the entire production line will cease. It was being built on a five year contract with specialty car maker Karmann (as in Karmann-Ghia), and given the financial upheaval the company is going through until it (if) is sold, don’t expect any model to replace it. It always seemed to me that the Crossover was the answer to a motoring question no one was asking. Buh-bye.

Have Dodge Cup Teams, Need Partners

Dodge NASCAR teams Ray Evernham and Richard Petty Enterprises are shopping for financial partners to help carry the big-buck load it takes to compete in Cup racing these days. Richard Childress Racing was the first team to sell equity in their racing operation to gain financial and competitive leverage – it appears to be working as his team has rebounded in strength. Roush Racing followed Childress’s lead and has also taken a moneyed investment partner. Seems a cool $20 million-plus it what it takes to run up front in Cup these days, and with four teams (the max allowed), you’re pushing some serious cash. Robert Yates Racing is also on the hunt for a financial partner. You will be hearing more about teams doing this in the coming year(s).

Ray Evernham wants to return more to the mechanical side of racing to make his Dodges more competitive (and with the new COT, they need all the help they can get right now), so that is one of his prime motivations. He also wants to automate with robots the assembly of his race cars – not a cheap initial investment. Plus, he wants to expand to a four-car team, (ultimately necessary to win a championship it seems) and so far hasn’t found a sponsor with the jack to do so – there are just not that many available these days. When you start asking for the kind of money it takes today to sponsor a Cup team(s), business don’t want to be sponsors; they want to be partners to watch after that sort of investment.

For Petty Enterprises, they are pushing to get team franchising on the table in NASCAR and authorized. I wish them luck. It’s a tough sell to get a sporting business partner on board your Cup team – if you can’t offer some sort of guarantee on the return on their (big) investment. Without franchising in NASCAR (which they have been wishy-washy on for years – to their advantage) – a team has no intrinsic value; no guarantee of value for years to come. There are no retirement plans in NASCAR.

Return of the Hornet?

Speaking of unloved brand names – business press reports are that the Dodge Hornet name is at the front of the line as the minicar to be built by the Chinese Chery Automobile Co. for Chrysler once the dust settles on who owns the Pentastar. Oh boy. What marketing genius decided this brand name had to be unearthed from the depths it should have remained cemented in? Has anyone in that department ever driven the aforementioned original AMC Hornet? Seen pictures of it? (I have both, but thankfully those brain cells are dead now and the memory is gone.) People, people, people, get a clue and earn your pay – think up some sort of car name that doesn’t have such a pitiful legacy of non-carness. Maybe they were going for the Hudson Hornet legacy crowd?

D-C Shareholders Meet April 4th

Wish I could get the front office to spring for a ticket to Berlin to attend the D-C shareholder meeting in a couple of days. An announcement on the sale progress of Chrysler is expected, but not guaranteed. The event sounds like a rousing good time. One proposal, by longtime German shareholder activist Ekkehard Wenger is to change the name back to Daimler-Benz AG. He wants to clarify the mind of management to get them to solve the “Chrysler problem” as he calls it. Throwing “Chrysler” off the marquee might tend to do that.

About 8,500 shareholders are expected to attend this meeting (!!), and they have previously lasted longer than 12 hours -- each shareholder is entitled to ask questions of the management board. They have ranged on everything from fuel efficiency to the lack of women in senior management to why the brand sponsors rodeos. Maybe someone will ask why the wretched Hornet name is being considered for a Dodge car. 

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