NAIAS Report: Ford and Chrysler

The 2010 North American International Auto Show was a watershed moment in time for Ford. Riding high on American pride and optimism, the one major American manufacturer that didn't need a bailout or bankruptcy protection in '09 started the show in Detroit by sweeping the North American Car and Truck of the Year awards. The 2010 Ford Fusion Hybrid beat out the VW Golf Mk6 and Buick LaCrosse for the car award, while the 2010 Ford Transit Connect compact commercial van beat the Chevrolet Equinox and Subaru Outback in the truck category. It was only the third time in the award's history that a single manufacturer has taken both honors. To note, Honda did so in 2006 with the Civic and Ridgeline and GM did it in 2007 with the Saturn Aura and Chevy Silverado.

One look at Ford's massive, enclosed display said it all. The thing bathed the showgoer in a softly glowing shade of Ford pride blue. Henry's surname was to be found on every wall, in every corner of what looked like you had entered into a totally different, if not entirely well-organized, building. Ford's display was by far the most impressive among all the manufacturers and it exuded confidence.

Taking the "Crisis" Out of "Chrysler" (Part 2 of 2)

Chrysler has been drowning. It's not a big secret.

In 1999 - the first full year they were part of DaimlerChrysler - 2.6 million Chryslers, Dodges, Jeeps, and Plymouths were sold in America. For 2009, they may sell 900,000. If they're lucky. In the last 3 years alone, sales have dropped a staggering 58%.

As has been discussed before, this cliff dive is due to a variety of factors. The biggest among them is that, with few exceptions, their current product line is woefully behind the competition in nearly every measurable way. Quality isn't there. Reliability has been at the bottom of the barrel. Design execution has been subpar. Fuel economy is no great shakes. And for the 4 months between their emergence from a quick-rinse bankruptcy, and last month's release of their "5-year plan", they hadn't spent money to advertise their rag-tag group of misfits.

All the while, reports of angry, jettisoned dealers and Obama officials admitting shock at how far-gone Chrysler was when they stepped in has filled the void in airtime and column inches that their advertising would have otherwise occupied.

The rank ineptitude of the Daimler management at Chrysler was hugely responsible for the bad product decisions that pushed Chrysler to the brink. And when Cerberus took the company over in 2007, they brought in their own group of incompetent managers that only cut employees, plants, future vehicle development, and other costs to the bone.

So, since the year began, the bankruptcy court has decoupled Chrysler from Cerberus. The Feds have thrown them a multi-billion dollar life preserver. And Fiat has pulled America's third-biggest car company, floating listless in a heavy sea of fierce competition, aboard its own recently-mended ship.

CEO Sergio Marchionne's plans are certainly ambitious. He has acted fast, ending engineering alliances with Renault-Nissan, Mitsubishi, and Hyundai, and starting Chrysler on a path of better integration with Fiat AG.

But will the company once known as "Fix It Again, Tony" be any better for Chrysler than Daimler was? In a word: Yes.

Who Put the "Crisis" In "Chrysler"? (Part 1 of 2)

The Chrysler Corporation is an 84 year-old with Bipolar Disorder. There is no better way to describe the company.

Their history reads like a giant roller-coaster ride of manically high highs and depressively low lows. In the last 30 years alone, Chrysler has been at death's door 3 separate times (1979-81, 1990-92, 2007-present), and taken US Government bailout money twice (in 1980 and 2008/9).

They were on the ropes in the early 1960s because they downsized their cars when everyone wanted them bigger and more powerful; the early '50s because they'd restyled the entire line way too conservatively for the first "Age of American Excess"; the mid-'30s because they'd practically bet the farm on odd-looking aerodynamic "Airflow" cars that were too far ahead of their time for people's tastes; and were founded by Walter P. Chrysler in the midst of the collapse of Maxwell-Chalmers in the mid-1920s.

But their highs have been incredible. After being saddled for half a decade with stodgy designs, Chrysler debuted new "Forward Look" cars in 1955 and '57 that sent GM and Ford scrambling to compete. Chrysler's longer, lower, wider designs, advanced engineering, and pioneering features pushed Plymouth, Dodge, DeSoto, Chrysler, and Imperial sales through the long, sweeping roof and set trends the industry would follow for years.

The late '60s and early '70s were kind to Chrysler, as well. Their big and midsize cars got slick "fuselage" styling. Their muscle cars were hot and there were plenty of them (Duster 340, Barracuda, GTX, Road Runner, Superbird, Challenger, Charger, Charger Daytona, Coronet Super Bee, and Sport Fury GT). Their all-new trucks and vans were winning people over. And their compact Darts and Valiants were selling out to the bare walls.

With Lee Iaccoca at the helm in the '80s, Chrysler climbed out of the grave by introducing the popular, economical K-Cars, the reintroding the convertible, and inventing the minivan. Chrysler came back quickly enough in the '80s to repay their government bailout loans ahead of schedule. They were doing so well, in fact, they went on to purchase American Motors, the fourth volume American vehicle manufacturer, in 1987, and picked up AMC's hugely profitable Jeep division for $1.1 billion in the process.

And as recently as 1998, the smallest of the Detroit Three was the most profitable among them. Chrysler had been totally turned around from its early '90s slump by offering swoopy "cab-forward" sedans (e.g., Dodge Intrepid, Chrysler Cirrus, Plymouth Neon), "rule-changing" Ram pickups, minivans for which they'd "thought of everything", and wild concept cars like the Viper and Prowler that were brought to production largely unchanged from their show car forebears.

So, what happened this time? Why is Chrysler once again swirling the drain, taking bailout money, and producing lousy, unimaginative products? Hadn't they learned their many lessons from the past?They probably had, actually.