Looks like Chrysler is near death


#1


Chrysler just announced that if you buy a new vehicle from them they’ll GUARANTEE the price of gas or Diesel at $2.99/gal for 3 years.



Chrysler must be getting very very desperate to start offing this. First it was the life-time warranty on the power-train. Now this. Their sales are down 23%. I hope they don’t go under…but it doesn’t look good.


#2

If only I could afford the new Challenger, I’d snap that up since they’re basically giving you a good 50 cents off a gallon right now


#3

I think the current owners, who are not car people, are getting ready to sell them to the Chinese, who are looking for an entry into the N.A. market. Chrysler had already planned that their next small car would be manufactured in China.


#4

Wow, for 3 years…that’s quite the offer. Especially since it’ll probably be 5 or 6 dollars/gal by then.

Hang on…it’s not THAT good:

“The sales incentive, which will be rolled out on Tuesday, will only cover the first 12,000 miles driven based on the estimated mileage for the Chrysler car or truck purchased, executives with the privately held automaker said.” *


#5

This is why I think it’s a gimmick…The offer will only be good while the company is in business. If they file for Chapter 11 or 13…there goes offer.


#6

See my update above - further supports your belief that it’s just a gimmick, and I agree.

It would be an amazing offer if it was for unlimited miles/3 years and the company stayed in business. :slight_smile:


#7

The offer is well calculated and no different then offering $2,000 cash back on purchase, or low financing. If gas was at $3.50 for the next 3 years then they would have to absorb a cost of around $900 over 3 years. If gas goes to $4.00 for the next 3 years then it’s around $1,800 and so on. Even if things turn into a nightmare starting tomorrow and gas goes to $5 a gallon for the next three years they’re still fairly OK. Clever move by someone in the marketing department.


#8

This might actually be a very successful sales gimmick. Few buyers are going to do the math (just like those who have responded to this post so far). But check page 2 of the link provided by Jad ( http://www.reuters.com/article/rbssConsumerGoodsAndRetailNews/idUSN0542487520080506?pageNumber=2&virtualBrandChannel=0 ) and you will discover that the estimated fuel savings are about $1300 for the Ram pickup and about $800 for the compact Caliber. These figures are well below the industry-standard cash rebates that competitors will offer this summer.

Rather than reading this move as a desperate act by a dying company, I see this as a clever marketing scheme that will boost sales at no financial distress to the manufacturer.


#9

36,000 miles @ 25mpg, say comes to $1440 gals with a saving of about $1.25/gal comes to $1800 incentive to clear out overproduction. This is not much different than the norrmal discounts, but it’s eye catching. The risk is a diesel panic with prices going to $5+ quickly.


#10

Good points Steve, but I think the big limiter on this deal is the 12,000 miles. I think most people drive that many miles in about a year. If it was unlimited miles, then someone who drives 30,000 miles a year (with gas prices possibly going to $5 or $6 in the near future) would really benefit, more than they would with a cash rebate, etc.


#11

I did the math…and those are only ESTIMATES. There’s a very good chance that gas prices will rise to $5 or even higher in the next 3 years. Maybe Chryco knows something we don’t know (which is very possible). If the only way you can get this deal is if you pay MSRP then it’s NOT much of an incentive. If you can get a normal discount (say 3-6k) AND this deal it starts to look decent…at least on the surface.


#12

IMHO, they are already dead, but the life supports hasn’t been unplugged yet. Their brand names will probably be around for a while (especially jeep) as the company get sold further down the food chain. The will eventually “merge” with another company and the name will disappear. These silly sales gimmicks do make them appear desperate (probably because they are desperate).


#13

It really just is another incentive instead of rebate to buy their vehicles. A creative one for those who cannot understand a rebate is likely much better for them or simply another vehicle.


#14

If they start offering oil changes for life, I give the company a year before it folds like a (add a cliche here).


#15

Bob Nardelli is up to his smoke and mirrors just like he did at Home Depot. Play the numbers enough and you’ll look good, for a while…


#16

Once again, do the math. An oil change every 7500 miles at an estimated dealer cost of $20 – if the vehicle lasts 200K it costs the company only about $520 per vehicle. In lieu of $1000 rebate?? Another clever marketing strategy!