Tagged: Chrysler

Chrysler's new car sales have been improving faster than almost any other car company in the U.S. in recent months.

But the company has also been relying on subprime borrowers more than almost any other car company.

That's according to Edmunds.com.

People with good credit can usually find a car loan with a four percent interest rate.

But a growing number of Chrysler's customers have poor credit - and their loans have ten percent interest rates.

Edmunds analyst Jessica Caldwell says it's definitely boosting Chrysler's sales, but there are risks.

"I think subprime can tarnish your image in a way," she says.  "If you have a high percentage of subprime borrowers, people start to catch on or think that perhaps your brand isn't as prestigious as you would want to think it is."

Even though subprime car loans are riskier, there is still a relatively low rate of default.

People are much more likely to default on a subprime house loan than a subprime car loan. 

There’s an old Russian saying that, even, if you covered the world with asphalt, eventually a crack would form.

And in that crack, grass would grow. I was reminded of that yesterday by an Italian businessman my age, a man who is betting on green shoots coming through a town caked with many layers of asphalt. His name is Sergio Marchionne, and he is the CEO of a company called Fiat. Three years ago, he did something many at the time thought stupid. He took over a dying bankrupt company.

It was a company with lousy product, plummeting sales, little vision and what looked like no future. You may have heard of it.

Chrysler says its Jefferson North Assembly Plant in Detroit will forgo the traditional two-week shutdown this summer.

The unusual move will help the company keep up with strong demand for the Jeep Grand Cherokee and Dodge Durango. 

Sales of the new Durango are up 33% from last year, and sales of the new Grand Cherokee are up 44%.  

The factory's employees are already working nine hour shifts plus two Saturdays a month, but Chrysler spokeswoman Jodi Tinson thinks they don't mind.

"Considering where we have been over the last couple of years, I think there is a very positive feeling that these vehicles are being so well received," says Tinson.   "And they (workers) are reaping the benefits by being able to work some overtime."

Chrysler had been planning to hire 1,100 new workers at the plant next January but will move that ahead to this November.

Chrysler will start renting office space in a downtown Detroit skyscraper later this year.

Chrysler’s CEO and other business leaders have already re-christened the building “Chrysler House.”

Chrysler will move only about 70 employees into the former Dime building in the heart of downtown Detroit. But CEO Sergio Marchionne says it reflects Chrysler’s commitment to “put down roots” in the city and the region.

Marchionne says the resurgent Chrysler sees its own fortunes tied to Detroit’s.

“The people of Detroit and this region have contributed to making our country great again with their talent, their commitment, and their sweat," Marchionne said. "Detroit is the place that we feel at home. That’s why we’re proud to say that from now on, this building is going to be known as Chrysler House.”

Marchionne also noted Chrysler’s plans to “substantially expand” its industrial presence in the city. The automaker plans to re-open one Detroit assembly plant, and up production at two others by next year.

The move is also another win for the city’s central business district, which has announced some major new tenants in the past few months.

Quicken Loans CEO Dan Gilbert has been one of the key figures pushing to revitalize downtown with his Detroit 2.0 initiative.

“Together we are creating an urban core in downtown Detroit, that will be a spark of the entire region, that will have jobs, growth, and excitement,” Gilbert said.

Marchionne says Chrysler employees will move in once the space is refurbished, likely sometime this summer.

The Detroit Free Press also reports that Chrysler has now committed $3.3 million to help build a light rail project in downtown Detroit. The M-1 rail project will jumpstart with funds from private backers. It's still awaiting approval from city, state, and federal officials.

The Dart will help make Chrysler a full-line auto company once again. It's a compact car, or so-called "C-segment," car.

It's the first vehicle to combine a U.S. design with a Fiat chassis or platform.  The last small car Chrysler made was the Dodge Caliber and that was not very successful.

Chrysler and Fiat CEO Sergio Marchionne thinks the Dart will do much better.

"We are looking forward to a successful launch of a C-segment sedan, which is a piece of the market that we've been absent from for a long period of time, so we're expecting great volumes in terms of the Dart for the remainder of the year," said Marchionne.

A version of the Dart that gets 41 miles per gallon is expected later this year.

DETROIT (AP) - U.S. safety regulators have expanded an investigation into Jeep Wrangler fires.

The National Highway Traffic Safety Administration is asking Chrysler for information about Wranglers from 2007 through 2012.

That is an expansion of a probe that began March 28, and focused on vehicles from the 2010 model year.

Chrysler makes Jeeps. It sold more than 532,000 Wranglers from 2007 through March.

The government says 23 Wrangler owners have complained about fires. Complaints say four people were hurt and two houses were damaged. Three of the injuries were minor burns.

Chrysler had no immediate comment on the expanded probe Wednesday. It has said the Wrangler meets or exceeds all safety standards and has an excellent safety record.

An investigation can lead to a recall.

Jeep has signed a three-year, $45 million marketing deal with an Italian professional football club. 

The agreement could help the brand make inroads in Europe, where SUVs are uncommon.

The Jeep logo will soon appear on the backs of the jerseys worn by the Italian soccer team Juventus.  The team will also get Jeeps for club use. 

Michigan Radio sports commentator John U. Bacon says it’s an aggressive marketing ploy that will almost certainly boost Jeep’s brand awareness in Europe.

"In most of Europe, it’s soccer and everything else -- it’s like hockey in Canada," says Bacon.  "So this kind of exposure, it has to give Jeep a shot in the arm.  This team’s visibility is as big as it gets.    If the soccer team says it’s cool, it’s cool."