Chrysler is in deep trouble. It is deep enough that analysts and the media have questioned whether it has enough cash to make it through a turnaround, especially in a harsh auto sales enviroment in the US.
The head of Fiat who now runs Chrysler as well gave a sign that the problems at Chrysler are indeed very severe. He fired the CEOs of both the Chrysler and Dodge brands. They are being replaced by more junior managers at the No.3 US car company.
Sergio Marchionne, who must now balance his time as CEO of Chrysler and Fiat, has not inspired any confidence in the American firm by taking such drastic steps, and the executives who were fired can hardly be blamed for the company’s performance. The model lines of Chrysler, Dodge, and Jeep are made up of old vehicles particularly minivans, mid-sized sedans, SUVs, and pick-ups. Few are fuel efficient. Chrysler has almost no presence in the hybrid vehicle market. Ford (NYSE:F), Toyota (NYSE:TM), and Honda (NYSE:HMC) are thrashing Chrysler in across every model line.
Marchionne can fire the entire top management of Chrysler. He won’t have solved his problem. Chrysler does not make cars that Americans want to buy and he is many months away from having new vehicles in the company’s line up.
Douglas A. McIntyre
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