Jeep Sales Down, DC to Idle Plants, DC CEO Defends Chrysler Strategy

Date 2000/12/6 0:00:00 | Topic: Sales


DaimlerChrysler has reported that Jeep sales for the month of November, as well as for the entire year, are experiencing a significant decline as compared to calendar year 1999. Here's the most recent breakdown:

DaimlerChrysler Corporation U.S. Sales Summary, Thru November 2000                        Month Sales       DR %       Sales CYTD      DR %  Model                Curr Yr  Pr Yr    Change    Curr Yr    Pr Yr  Change  Wrangler              4113    6282      -35%      77711     83100    -7%
Cherokee             11691   13982      -16%     129273    151811   -15%
Grand Cherokee       19944   23585      -15%     251143    275958    -9%
JEEP BRAND           35748   43849      -18%     458127    510869   -11%

These most recent sales numbers are not unique to the Jeep line, similar declinces are seen across a good portion of the Chrysler line. These recent losses have forced DaimlerChrysler to idle a number of production plants during this holiday season. Here's a snippet of what Yahoo! News is reporting regarding the shutdowns:

German automaker DaimlerChrysler AG on Friday said it would cut North American production in December by idling several plants, after a 5 percent drop in November U.S. light-vehicle sales for the Chrysler, Jeep and Dodge brands.

U.S. light-vehicle sales for its Chrysler, Dodge and Jeep brands last month fell to 184,065 units, including a 16 percent drop in minivan sales and a 12 percent drop in car sales, the company said on Friday.

Of its 12 U.S. and Canadian vehicle assembly plants, 10 will operate next week, 11 the week of Dec. 11 and seven the week of Dec. 18.

The temporary plant shutdowns come as the former Chrysler Corp. struggles to return to profitability. It suffered a $512 million loss in the third quarter amid signs of a slowing U.S. economy.

The shutdowns follows a one-week shutdown of seven DaimlerChrysler North American assembly operations five weeks ago, and the temporary idling of several plants in November.

Finally today, DC's CEO, Juergen Schrempp, has been spending alot of his free time defending his company's decisions regarding the U.S. arm of DaimlerChrysler. It seems that in addition to defending a $8 billion lawsuit brought on by DC's third largest shareholder (something about being lied to about the Daimler-Chrysler merger), Mr. Schrempp is facing critisism from the German press. Here's a snippet from Yahoo! News:

DaimlerChrysler AG's embattled chief executive Juergen Schrempp on Saturday defended the group's strategy in the United States and rejected calls for a sale of its struggling Chrysler operations.

Schrempp, facing calls for his departure from a number of shareholder activists in Germany, as well as an $8 billion lawsuit from DaimlerChrysler's third largest shareholder, said in a series of German media interviews at the weekend that a sale of Chrysler would make no sense.

``That would be to give up the potential of our position as a global auto concern,'' he told the weekly Der Spiegel.

``The organisation we have today and the processes we have in place are the right ones to take on the challenges we face and to exploit the opportunities in our company,'' he said in a separate interview with Welt am Sonntag.

But Schrempp, who has faced a blizzard of criticism over the past weeks also came under renewed fire, this time from the BDA German employers federation.

Hans Michelbach, a member of the BDA directorate, said in a guest article in the Bild am Sonntag newspaper that Schrempp's ``untruthful declarations'' at the time of the merger had damaged confidence in German business in the United States.

Michelbach said Schrempp's recent admission that he had always seen Chrysler as no more than a division of the group rather than an equal partner as he declared at the time of the deal had hurt the image of German managers across the world.

DaimlerChrysler faces an $8 billion lawsuit from its third largest shareholder, billionaire investor Kirk Kerkorian who alleges Schrempp was guilty of deception when he claimed in 1998 the deal was a ``merger of equals.''

In an interview with Welt am Sonntag, issued ahead of publication, Schrempp appeared to backtrack from comments in an October interview with the Financial Times, claiming the deal had indeed been a ``merger of equals.''

For more information, be sure to check out the entire article.





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