2008 Car Sales So Far, and Chrysler’s ‘Strategy’

Since I’ve been blogging, the foreign transplant car companies’ sales performance has consistently outperformed Detroit’s Big Three.

The first two months of this year of 2008 continued that trend. Here are the six largest companies’ January (Big Three; other three) and February sales results –
- General Motors: +2.8%, -12.9%
- Ford: -4.1%, -6.6%
- Chrysler: -12.1%, -14.0%
- Toyota: -2.3%, -2.8%
- Honda: -2.3, +4.9%
- Nissan: -7.3%, +1.2%

Every company is clearly struggling to make headway in the current economic environment. But as usual, GM, Ford, and Chrysler are having the toughest time.

GM clearly has serious challenges. Ford continues to court corporate suicide by ignoring a boycott that is cutting the company off from 10%-15% of its US customers. The fact that its sales are “only” down by a little bit more than GM’s during the first two months of this year is scant cause for comfort. Because Ford’s sales have declined in 21 of the past 24 months, its base, which was already smaller, has shrunk considerably more than has GM’s during that time.

But it appears that Chrysler may be quickly turning into the Big Three’s biggest problem child.

I wonder why?

Well, no surprise here. Home Depot plunderer Bob Nardelli, who took over Chrysler in August, has been getting congratulatory write-ups such as this one for bullying, cutting costs — and, from all appearances, doing nothing else. Big whoop, Bob. That course of action, and doing nothing else, is what caused Home Depot to underperform while you were there.

Where’s the innovation and creativity? The answer is in the linked Fortune article — absolutely nowhere:

Chrysler’s New York-based owners should also be pleased. Nardelli’s unspoken mission all along has been to get Chrysler in shape for sale to another buyer - likely another auto company. With its strongest brands and models all for sale under one roof - and hopefully profitable - Chrysler will look a lot more attractive to potential suitors.

Here we go again. I see another massive severance payment in Bob Nardelli’s future. But his slash and burn strategy is on a collision course with cratering sales. If January and February are harbingers for where Chrysler is heading this year, Chrysler’s private-equity owners are going to have to sell in a hurry before the deterioration becomes too obvious.

Now that the “unspoken” has been spoken, I’m sure Chrysler’s rank and file employees are soooo motivated to keep up appearances until that day comes.(/sarc)