Thomas Wilberding's List: Autos

Thursday, April 30, 2009

Does any magic remain?

Chrysler has dodged doomsday before, now it needs to pull off one more
trick

Maryann N. Keller

Chrysler just might be the cat that's now in its ninth life. Should Chrysler
survive on its own because of government arm-twisting, its future will remain in
doubt.

The market certainly hasn't voted to keep Chrysler alive; it (and GM) would
already be in bankruptcy today without government assistance. And it could be
forced to go through what government officials call a "quick rinse bankruptcy."
But the go-forward game plan for Chrysler with Fiat cars and UAW ownership has
no future without new Jeep, Dodge and Chrysler products and a lot more cash, and
that's the rub in this cat's life.

Looking back, each time the economy cycled into a recession since the
mid-1970s, Chrysler had products in the pipeline that ultimately revived the
company. Think back to the Omni and Horizon, the Aries and Reliant K cars, the
minivan and, of course, the innovative styling of the cab-forward LH cars.


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Whenever it looked like the end of the road for Chrysler, the product
development guys, often working with shoestring budgets, were able to dazzle car
buyers with creative design coupled with clever, if not a bit over-the-top,
advertising.

It was the promise of the Aries and Reliant that got Washington to agree to
loan guarantees in 1979. The minivan defined family transportation for a
generation and the cab-forward sedans gave back seat passengers legroom not
possible in previous designs. As the economy recovered, Chrysler's market share
and profits soared on the popularity of its new models.

This time it's different. There is no dazzling model waiting in the wings to
save the day.

Daimler eviscerated product development, the lifeblood of a car company,
after it took over Chrysler in 1998. During the past few years, Chrysler dealers
have done yeoman's wo