Chrysler Vice Chairman and President Jim Press says that Chrysler can be "viable" by spring -- with "viable" defined as solvent and investing in new products that will allow the company to repay its government loans in the future. He told reporters at the National Automobile Dealers Association annual convention that the company can achieve viability even with light vehicle sales slipping from 2008's 13.2 million units to just over 10 million in 2009.

Press said that the company's new product lineup, loosening credit markets, and buyer incentives would help the company to get back on track.

Chrysler appears to be pulling out all the stops to improve it performance -- but not in a good way. Yesterday I wrote about the pressure that Chrysler was putting on dealerships to order more cars than they think they can sell. This could prop up sales volume in the short-term with disastrous long-term consequences: some dealers who can't afford to pay for the cars they ordered and others who are so stuffed with inventory that they won't be ordering anything new for a long time.

It's disappointing that Chrysler's deliberate and unapologetic efforts to artificially prop up its sales numbers aren't getting more media attention. These efforts may allow the company to create a facade of a turnaround and gain access to more taxpayer money, without actually having changed anything of substance.

Chrysler says it can be viable by spring originally appeared on BloggingStocks on Sun, 25 Jan 2009 09:10:00 EST. Please see our terms for use of feeds.

Chrysler has a new plan to try to work its way through the recession: Convince dealerships to buy cars they don't need.

The Wall Street Journal reports (subscription required) that "Chrysler LLC executives are fanning out across the country to ask dealers to order new cars and trucks as part of an urgent bid to increase revenue following the company's flirtation with financial collapse."

Chrysler is offering bonuses to dealers who agree to take delivery of more inventory. The idea seems to be to pump up the company's sales volume to help secure an additional $3 billion in government loans.

Here's the problem: If dealers order inventory based on pressure to prop up Chrysler's income statement instead of their own estimates of market demand, they'll end up with huge inventories of cars that they can neither sell nor pay for.

Continue reading Chrysler announces plan to stuff the channels

Chrysler announces plan to stuff the channels originally appeared on BloggingStocks on Sat, 24 Jan 2009 11:10:00 EST. Please see our terms for use of feeds.

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