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Chrysler Dealers Still Hoping for the Automaker's Survival

The same day that American billionaire Dodge trucks, and minivans have accounted
and investor Kirk Kerkorian offered a bid for 70 percent of Chrysler's sales at the
of $4.5 billion for Chrysler Corp., is time when gasoline cost nearly $3 a
the time that a car salesman in Southold, gallon in the US.
New York was also dusting off a framed The Struggle of Chrysler Dealerships
print. Mullen for his long years of selling
Chrysler dealer Dick Mullen said last Chrysler products have weathered out very
April 5 while smiling at an editorial storm. He and his father each bought
cartoon from the 80s, "Time to hang this $10,000 of Chrysler's debentures in 1980
up again. It shows a car bursting from that earns them 11 percent interest per
the ground beneath a gravestone marked year interest. It was also their Chrysler
``Chrysler: R.I.P.'' dealership that was the first to sell
Mullen's shop has stayed on Long Island's Jeep in the US after the company bought
northeast corner for 80 years and has American Motors in 1987. Mullen has met
witness to the rise and fall of Chrysler Iacocca twice and later he was invited
through decades of miscues. Way back in along a handful of dealers at a lunch at
the 80s the good old Mullen has loaned New York's Waldorf Astoria hotel.
Chrysler some $10,000 when it was nearing The main purpose of Daimler for
bankruptcy. And today Chrysler's future purchasing Chrysler is to gain
is again on the brink as its German mass-market American foothold.
parent DaimlerChrysler AG is opening all Unfortunately instead of the gain it is
options for its sale. Despite the expecting it has found itself struggling
somewhat bleak future that Chrysler is because of price discounts and union
facing today, Mullen remained calm and retiree costs that add $1,300 to the
unafraid leavening the wait gallows price of each car. And today with oil
humor. prices surging high some investors see
According to Mullen, 70 when he told the future of Chrysler as becoming
sales Chief Steve Landry at New York Auto bleaker than before.
Show last April 4, "It's the fourth time According to Tim Gilbert, who helps
I'm going out of business with you guys, manage $10 billion in assets including
I'm getting a little tired of it." He DaimlerChrysler bonds at principal Global
also suggested for Chrysler to write a Investors in Des Moines, Iowa, "When the
book based partly on his up-and-down ride product cycle turned, the ugly really
and pass it out to future executives. outweighed the good." He also said that
Landry said as a way of confirming his he firm is adding more bonds of the
conversation with Mullen, "Most of our Stuttgart Germany-based carmaker because
dealers have faith, and they know that it should be more stable if it sells
whatever happens, our brands and products Chrysler.
are not going anywhere." He also said DaimlerChrysler shares on the New York
that he plans of meeting with as many as Stock Exchange have jumped 25 percent to
50dealers this year to answer questions $80.69 since the company has announced
and to mend relationships. last February 14 of its plans of getting
Surveying the business of Mullen and the rid of its money-losing arm Chrysler.
rest of his fellow car dealers on Long Overproduction is the Problem
Island, it's hard to miss the obvious Mullen says that Eaton was smart to sell
fact that the Japanese carmakers when Chrysler was riding high. But he was
influence has also reached Long Island. less happy last year, when Chrysler's
The Union production outstripped demand. Mullen and
Chrysler maker of Dodge truck parts and the other dealers were left with unwanted
Dodge truck accessories has been a one of vehicles. This has provided Mullen with
the 'Big Three' US automaker alongside the idea for his book which he has given
General Motors Corp. and Ford Motor Co. the theme: 'Overproduction causes
way back in 1929. Unfortunately out of problems.'
the 'Big Three" it's only GM that has Landry also said that he is aware that
successfully maintained its post. dealers were upset and that is why he's
The wrong decisions that have been meeting with many of them this year. The
plaguing Chrysler started back in 1970s most perplexing thing that Mullen found
when the Auburn Hills, Michigan-based on the potential sale is that Chrysler
automaker try to push gas guzzlers as oil cars have never been better. As a matter
buying habits were changing. Chairman Lee of fact the Crossfire sports car shares
Iacocca was able to avoid bankruptcy when 40 percent of its parts with Mercedes
it acquired $1.5 billion including the engine. The Chrysler 300 on
government-guaranteed loans. After a the other hand makes use of the same
revival behind the compact K-car and the axles and transmission as the Mercedes
minivan, the US automaker once again E-Class sedan.
embarked in 1998 on a rocky $36 billion Chrysler is also narrowing the quality
union with Daimler, the maker of gap with Toyota just last year the
Mercedes-Benz. average new Chrysler had 12 percent more
The union only plunged Chrysler to graver problems than a typical Toyota basing on
financial crises that went on for more the results found by researcher J.D.
years than anyone can remember. Chrysler Power & Associates in Westlake Village,
has obtained a $1.5 billion loss which California. But despite such that average
prompted its German parent to investigate is much better than the average industry
a sale. It was also then that Chrysler gap of 15 percent and far better than the
has surrendered the No.3 slot in the US 22 percent that Chrysler incurred in
market share to Toyota Motor Corp. Jeeps, 2000.




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