Chrysler is offering up to $5,500 cash back on the Ram 1500 pickup, and big incentives on the rest of its line-up in an effort to reduce foundering sales.
Desperation is setting in at Chrysler, one of the few automakers to see sales fall yet again, last month. The automaker has announced plans to step up incentives that will, on some models, yield consumers cash-back savings of as much as $5,500.
Halting the sales slide will be critical, according to industry insiders, if the smallest of the domestic makers hopes to pull off the dramatic turnaround outlined by new CEO Sergio Marchionne, earlier this month. The Italian executive said Chrysler not only hopes to be back in the black, on an operating basis, in 2010, but that it plans to recover roughly five points of market share during the newly-announced, 5-year recovery plan.
While General Motors, which also emerged from bankruptcy over the summer, posted a 4.7% sales increase for October, Chrysler’s numbers were off a painful 30.4%. For the first 10 months of 2009, its sales were down 39%.
The big challenge, company officials acknowledged, during the November 4 turnaround briefing, is that it will be 2011 before Chrysler and its new partner, Fiat, begin rolling out the line-up of new products necessary to rebuild momentum. So, until then, incentives are likely to be hefty on Chrysler’s older models.
The company will offer 72-month 0-interest loans on leftover 2009 Ram 1500 pickups, or $5,500 in rebates. On 2010 versions of the truck, the cash drops to $2,500, but 0-interest loans will be available for up to 48 months – with a 2.9% interest rate on 60-month loans.
All Chrysler, Jeep and Dodge vehicles will now be offered with interest-free loans for up to 60 months, and cash-back incentives, varying by brand, up to $4,000.
The complex line-up of incentives also includes free DVD systems on the Chrysler Town & Country minivan and free all-wheel-drive on the Dodge Charger.
While CEO Marchionne has aggressive plans for Chrysler, he said that the company doesn’t want to simply buy market share, a position that could be seen as conflicting with the latest, high-dollar incentive program. Marchionne also said, on November 4th, that Chrysler will cut production to keep inventories in line with market demand. That could reduce the need for further incentives in 2010.
“The Year-end Wrap-Up,” as Chrysler is calling the campaign, runs from now until January 4, 2010.