The real question about Chrysler really is: What its it planning? Pundits are saying that the smallest domestic automaker's intention may not actually be a lack of foresight, but a lack of resources.
Chrysler is not, technically, a standalone carmaker, but only just barely. The hard bottom truth is it lacks the financial muscle, global reach, or technological capabilities of most of its rivals without a greased parent like Daimler. In essence, for any market with any vehicle out, it can be outplayed at every turn.
Whether or not Chrysler has sufficient cash to weather this storm is an open question. Even its recent partnership with Renault-Nissan may be insufficient to turn things around for the carmaker. Chrysler CEO Robert Nardelli says that Cerberus Capital Management is doling out enough cash, but at $3 billion a year, Chrysler is still only spending as much as it did under Daimler. Under that budget it managed to trail behind its rivals in the U.S. market and never successfully expanded overseas.
The deal with Renault-Nissan is to build a version of the Dodge Ram pickup truck while getting a decent compact in return. There is a distinctive possibility of a more permanent arrangement between the two although that may not come about for a while yet. By shopping for underused factories and making technology swaps like this, Chrysler is staying afloat, but it isn't standing on its own two feet.
By shopping for under used factories, and heavy restructuring, Chrysler is now one of the most productive in the industry; but with sales down 22 percent this year, it is in a precarious position of relying on outsourcing.
Additional details can be found at the original article. Our take? Chrysler’s strategy seems to be a long term one. It's attempting to survive with enough credibility to be potentially valuable at which point Cerberus Capital Management will pass it on to another car company when the economy is more favorable.
via Business Week