DSkippy

http://www.stltoday.com/stltoday/bus...0?OpenDocument

[quote]Chrysler faces a tough task
By Christopher Boyce
ST. LOUIS POST-DISPATCH
02/24/2008
Chrysler
Ron Warhoover, of Ofallon IL, and Jaydon Dailey, 5, look at the new high performance model of the 2008 Dodge Charger at Oliver C. Joseph Chrysler Dodge in Belleville. Warhoover , along with Dailey, and his wife Alana Warhoover, were looking for a new Dodge Ram truck.
(Emily Rasinski /P-D)

Chrysler LLC's five-year plan to reduce the company's size may be what's best for a struggling automaker in a tumultuous economy.

Although Chrysler may be doing the right thing, analysts say it will face a pair of simultaneous significant challenges — consolidating a fragmented dealership chain and replacing venerable product lines with fresh, exciting vehicles.

Some analysts say that they would be surprised if, in five years, Chrysler still is owned by Cerberus Capital Management LP and that the plan's real goal may be to get the automaker ready for sale.

Chrysler met with dealers in eight cities in early February to introduce "Project Genesis," a plan aimed at "right-sizing" the automaker given its shrinking market share.


Chrysler's share of U.S. light-vehicle sales slipped to about 13 percent of total sales last year from about 15 percent of total sales in 2000, according to market research firm Global Insight Inc. in Lexington, Mass.

To cope with shrinking sales, dealers are being asked to merge voluntarily dealerships that don't sell all three of Chrysler's brands — Chrysler, Dodge and Jeep — into single locations that do.

Consolidating will make things easier on dealers, Chrysler said, because the automaker also plans to eliminate several models, making it difficult for those that don't sell all three brands.

This is unsettling for Brad Joseph, general manager of Oliver C. Joseph Inc., a Dodge and Chrysler dealer in Belleville.

Joseph spent $6.5 million to move his third-generation, family-run dealership into a new facility in 2006. He spared no expense in investing in the dealership's future, even installing a fireplace in the showroom and attaching to it a restored 1927 railroad passenger car for use as a conference room.

Although his dealership carries only two of Chrysler's three lines, Joseph said he was not searching to buy a Jeep franchise. But he said he wouldn't mind adding a Jeep franchise for the right price.

The consolidation push could mean a shakeup for the St. Louis area. In December, Chrysler told the Post-Dispatch it had 57 dealerships in eastern Missouri and Southern Illinois, 33 of which carried all three brands. Although there have been several consolidations since then, Chrysler declined to provide an updated count for its local dealerships.

Dealers that need to acquire or sell will face a tough decision, said Vince Capatosta, president of All-Star Dodge Chrysler Jeep in Bridgeton. Aside from the difficulties associated with franchise sales and acquisitions, Capatosta said many dealers who should sell weren't yet ready to let go.

"When you have your lifeblood in one of these places, it's extremely difficult to turn the key and say, 'OK, I'm done,'" he said. "The economic reality is at some point a guy has to realize he is not going to make it selling one brand."

Joseph says he is happy with the current state of the company and its newest products. Chrysler debuted three new or redesigned products in the last few months to mostly positive reviews — the Dodge Ram pickup, the Dodge Journey crossover and a Dodge Challenger sport coupe.

FUTURE LINEUP

Still, Joseph is concerned about the company's future product lineup. Joseph says he usually has concept photos or at least descriptions of new vehicles two years before the models reach his showroom.

After meeting with Chrysler executives this month in San Francisco at th

RLSH700

They better not try to get rid of Oliver C. Joseph in that stupid plan. That would be a war on heritage. That dealership has been around since Dodge's beginning. They started in 1914 for crying out loud. We bought both of my parent's minivans from them. They had to move their facility as the section of town they were located in was part of the old town that was hard to find if you didn't know where you were going, and it was on a one way street. Plus they had their lots on several blocks because they didn't have enough room for the inventory. Their new facility is nice and located away from any areas that are currently likely to become run down and filled with crime (a growing issue in Belleville). If they have to kill one of them, they ought to kill the Chrysler/Jeep dealership in O'Fallon. Their sales staff is pretty sad, they lack Dodge (which to me is more an issue than lacking Jeep who only sells 6 nameplates of the same type of vehicle excluding the Compass that doesn't sell). They also have that appearance that tells you their not that good.

Jeremiah 29:11

Being an American, all of our American car manufacturers need to get their acts together and they may disappear just like the steel industry.

Back in the day remember all of the TV manufacturers in the U.S. and now we have none. RCA, Zenith, Maganovox, Quasar, GE, etc.

RLSH700

Well they still exist and build products, they just are no longer on the top (except for Quasar). Interestingly we still have a TV repair shop on the edge of town that has the old Quasar symbol, that should give you an idea how old that business must be.

Jeremiah 29:11

Yes but they do not manufacturer in the U.S.. They lost to overseas.

tupperware

you must be from around here too RLSH700....I am suprised that the article didnt mention that Oliver C Joseph is the oldest surviving Chrysler/Dodge franchise in the country... as for the dealership(s) in O'Fallon, they have their own impending troubles to deal with...there was some press a while back about the Feds, tax troubles, and off-shore companies...

RLSH700

The fact that Ski is my favorite soft drink should be proof that I know St. Clare county pretty well along with Clinton county (where they bottle it in Breeze) and a few others. Little trivia for you. My hometown was featured in a 1967 Blockbuster.

Not surprising. Auffenburg does not have the best reputation anyways so that does not surprise me. If they lose Oliver C. Joseph, they are committing a huge mistake. To me, that is worse a sin than dropping Plymouth.