We kind of hope the Chrysler Aspen hybrid carrying Bob "The Builder" Nardelli made it. Ford CEO Alan Mulally may have accidentally gone to the Senate Armed Services Committee, so someone should check up on him.

But, according to Wagoner, there's one overwhelming reason why America needs to save their automakers:

"It's very important for the U.S. to have a home team in the global auto industry..."

Photo Credit: Win McNamee / Getty Images News

This flies directly in the face of GM CEO Rick Wagoner's past comments that a bankruptcy would mean liquidation because customers would refuse to buy cars from a company that might not be able to back warranties or supply parts. Our sources, whether from inside the General or from the outside, have given us similar arguments in the past.

That hasn't stopped staff for three members of Congress, who've asked restructuring experts if a pre-arranged bankruptcy — negotiated with workers, creditors and lenders — could be used to reorganize the industry without liquidation.

But it's not just the congressional committees at work here. According to another source, a representative of Obama’s team contacted at least one bankruptcy-law firm to say Daniel Tarullo, a professor at Georgetown University’s law school who heads Obama’s economic policy working group, would call to discuss the workings of a so-called prepack, according to this person.

But don't expect anything on this to come out of this week's hearings as we're also told

"Negotiations are splintered among small groups, making it unlikely a proposed solution such as bankruptcy would emerge until next week at the earliest..."

We'll obviously continue to be all over this story like a fat kid on cake. Stay tuned throughout the day to our "Carpocalypse Now" tag today as we bring you the latest news from D.C.

[Bloomberg]

The biggest factor into how well a cash loan will work with the automakers will be the number of total auto sales in the United States. If an automaker makes the right projections they should be able to figure out how much money they'll need to get them through this downturn. So how did they each do in their projections? Let's take a look and grade them. Here are the sale projections from the three automakers:

Photo Credit: Christopher Furlong / Getty Images News

As recently as September, Chrysler said they had seven-to-nine new models for 2010. For the life of us, we can't figure out what those vehicles are considering the company's stopped development on every single product line. Are they talking about the Chrysler EV electric car family? Because seriously, that's smoke and mirrors. There's nothing new coming out of this company at any time in the next year.

But hey, Chrysler CEO Bob Nardelli also pledged to take a $1 salary and no kind of health or insurance benefits until the crisis is resolved. Well, he's earned it.

Because once you get past the huge $11 billion number and the fact that they're apparently going to be forced out of business in January without it, when you take a look at the automaker's plan, there isn't much in the way of specifics there. On the whole, the plan is less substantial than what GM or Ford are offering. I mean, although we may not agree with the sale projections they make, at least the other automakers are making a guess as to what sales numbers in the United States will look like for the next year. All Chrysler was willing to say was "Chrysler anticipates sales to be even lower than normal due to the economic downturn." What, did Chrysler can its market analysts already?

It's almost as if they're saying "buy us some time until someone else buys us." Actually, I think they may have said that on page three somewhere. Anyway, full highlights from Chrysler below.

Highlights of Chrysler LLC Plan Submitted Today to the Senate Committee on Banking, Housing and Urban Affairs and the House Committee on Financial Services

* Chairman and CEO Robert Nardelli looks forward to testifying before the committees later this week
* Chrysler will urge the immediate adoption of legislation that will allow domestic automakers to weather the current national economic crisis and continue to invest in industry-leading products, technologies and vehicles of the future
* Full plan attached as pdf file

* The first question is, what changes has Chrysler made to help itself? Since Chrysler became an independent company in 2007:
o We eliminated over 1.2 million units of capacity, or 30 percent;
o We reduced fixed costs by $2.4 billion and, separated over 32,000 employees – including 5,000 on the Wednesday before Thanksgiving. And at the same time …
o We invested in product improvements – over half a billion dollars in our first 60 days;
o We improved our latest JD Power quality scores, and reduced our warranty claims by 29 percent;
Part of our business model transformation includes alliances and partnerships – for example – the agreements to produce vehicles for VW and for Nissan. As a result, through the first six months of the year, Chrysler met or exceeded our operating plan, ending the first half with $9.4 billion unrestricted cash.

* Why does Chrysler need the funding? We need to address the unprecedented drop in vehicle sales caused by the financial crisis. U.S. sales are down from a 17 million unit selling rate in early 2007, to an estimated 11 million unit selling rate for the fourth quarter of 2008 – a 38 percent decline. We lost 20 percent of our sales virtually overnight when the financial market crisis forced us out of the consumer lease business. With customers not buying … with dealers not ordering … with our plants not producing … Chrysler’s cash inflow has suffered.
* So how will the bridge loan be used? Cash will support ongoing operations as we continue to restructure the business, including in the first quarter alone:
o $8.0 billion in payments to parts suppliers
o $1.2 billion for other vendors
o $900 million in wages
o $500 million in healthcare and legacy costs
o $500 million in capital expenditures

Without an immediate working capital bridge, Chrysler’s liquidity could fall below the level appropriate to ensure operations in the ordinary course by the first quarter of 2009.

* So, who is contributing to saving Chrysler? First and foremost, Chrysler and its extended enterprise will. That starts with me. I receive a salary of $1 a year. I have no employment contract, no change of control agreement, no “golden parachute,” and receive no health care or life insurance benefits from the company. We are committed to negotiate concessions from all of our constituents.
* The next question - Does Chrysler plan to build cars and trucks that consumers want to buy, and that support the country’s energy security and environmental goals? Our product plan features 24 major launches from 2009 through 2012. For the 2009 model year, 73 percent of our products will offer improved fuel economy compared to 2008 models. We plan on launching additional small, fuel-efficient vehicles. ENVI is our breakthrough family of all-electric … and range - extended electric vehicles – similar to the one parked outside. Chrysler’s product plan includes the introduction of the Ram Hybrid and our first electric-drive vehicle in 2010 with three additional models by 2013.
* Does Chrysler have a viable plan? With our requested bridge loan – absolutely! I also believe that further partnership, restructuring and consolidation would make the U.S. auto industry even more viable and competitive in the long run. Further opportunities for technology sharing would provide fuel-efficient cars and trucks more cost effectively and faster to market. The three-company alliance that developed the dual-mode hybrid is a good example. As a Country, we should not trade our current dependence on foreign oil for a future dependence on foreign technologies.
* The final question is, when will Chrysler pay back this loan? We believe we will be well positioned to begin repayment of the federal loans — in 2012. I recognize that this is a significant amount of public money. However, we believe this is the least costly alternative considering the depth of the economic crisis and the options we face.

[Source: Chrysler]

Although UAW officials and their allies counter the banks have been an effective way to keep a flexible job pool available and allow the companies to implement new technology while reducing overall numbers responsibly. More view that as complete hogwash.

Not much is known as of yet about specifics on the discussions. As of now we've only got a wire service report from the Journal telling us:

"The United Auto Workers union is in talks with some of Detroit's Big Three auto makers to stop a program that pays idled workers - WSJ"

Guess we'll have to wait for more. You'll hear it as soon as we hear it.

[via WSJ]

[eBay Motors], thanks to DodgePolara500 for the tip!

You got your Reliants and your Lloyds, but when you're talking about weird British marques that Americans can't identify… well, it's tough to beat a Humber. You get your Rootes Group-ish Chrysler-influenced styling, Lucas Electrics, and ahead-of-its-time technology (well, not really, unless the time is being set in Detroit) with the Magnificent Humber Sceptre!

Just look at that fine hunk of British iron! At this point, you're probably bummed because you know there's no way in hell to get a Sceptre without traveling to the UK, and even then you'd be in a frustrating right-hand-drive car… but hold on a second! There's a left-hand drive Humber Sceptre (go here if the ad disappears) available for just $750 in rust-free Southern California! We know, the seller says it's a '60 and the Sceptre Mark I didn't exist until 1963, but this one ran when parked! OK, that was 10 (probable Craigslist-to-English translation: 18) years ago, but the "motor turns over" and it looks like all the impossible-to-find glass is intact. Add an SR20DET and you'll be the Sceptre King of your time zone!

That Sceptre is mighty fine and that's a fact, but where's the sportiness? You need a slick-looking two-door to get anywhere in this world, and you need to remember that Chrysler wasn't just building Hillmans and Humbers and Singers in England- the Rootes Group was building cars in France as well! Yes, perennial PCH Superpower France, where engineers don't give a damn how the rest of the world thinks cars ought to be… and you're in luck today, because this 1959 Simca Aronde is available at a very reasonable price. How reasonable we can't say, because of that damn eBay reserve game, but we're betting it's a 3-digit number. That means you'll have money left in your budget for an Offenhauser engine to fill in that void under the hood, and then you can start the search for a new rear window. Oh, wait- the seller says "i have found a rear window and i will give new owner the phone number to buy it," so you're pretty much ready to go!

For example, when we heard Casey Wilson as NY Rep. Carolyn Maloney (D-Clueless) explaining to the auto chiefs Congress mandated 200 MPG cars and in doing so they've "done their part." The joke on cluelessly ineffective CAFE over-reaching was met with absolute silence. Contrast that with a moment later when Hammond, as Nardelli, responds to the question "What is Chrysler doing to make more fuel efficient cars?" with "I don't know." The joke's greeted with massive laughter. Here's a tip for GM, Ford and Chrysler — when you become a bigger punchline than Congress, you know you've done a piss-poor job at message management. Just sayin'... [SNL via Crooks and Liars]

"I want to bring Michigan back. I am not willing to sit back and say 'too bad for Michigan, too bad for the car industry, too bad for the people who lost their jobs, they are gone forever.' I will not rest when I am president of the United States until Michigan is brought back."

January is a long time ago in Romneyville as Mitt said this in the NY Times earlier this week:

IF General Motors, Ford and Chrysler get the bailout that their chief executives asked for yesterday, you can kiss the American automotive industry goodbye. It won’t go overnight, but its demise will be virtually guaranteed.

What's the difference?

After losing both the New Hampshire and Iowa primaries, Michigan became an incredibly important state for Romney's presidential quest. He was a big cheerleader for the auto industry and, according to the NY Times He:

campaigned as a populist champion for the auto industry on his way to winning Michigan’s primary last year, excoriating Senator John McCain for declaring on the stump that some of the industry’s lost jobs were not coming back.

Circumstances are different now and the $700 billion treasury bailout enraged small business conservatives. Michigan isn't as important a state for Romney as it once was and, if he wants to stay relevant, talking about the Detroit bailout has proven to be a big way to gain attention.

There's nothing wrong about believing that bankruptcy is the best path for the automakers. Many would disagree, but it is a completely valid point. What's wrong is that when Romney says Detroit shouldn't "ask Washington to give shareholders and bondholders a free pass — they bet on management and they lost," he fails to mention that in Michigan, during the primary, he also bet on Michigan. He said that he opposed new mileage requirements. He said we should give aid to bailout health care and pension costs of the automakers. From another article in January:

Romney proposed increased government spending for research on advanced fuels and vehicles, aid to automakers to deal with the costs of health care and pensions for retirees, and tax cuts for most taxpayers to help them buy new cars.

[...]

In Warren, McCain said he would be "ashamed" to tell voters that the lost jobs would return to Michigan, but he vowed to take care of displaced workers through a promised job retraining program that would be offered through community colleges.

There's nothing outrageous about what Romney is saying, but we have yet to see him aknowledge why he suddenly changed his mind.

[Photos by Bryan Mitchell/Getty Images, Scott Olson/Getty Images, GEOFF ROBINS/AFP/Getty Images, Bill Pugliano/Getty Images, J.D. Pooley/Getty Images ]

Though the plant is 80% complete, it isn't clear who could come in and pay for completion of the plant or if Chrysler will have cars to put the new transmissions in for the future since the company has few new cars coming down the pipeline. This is more bad financiapocalypse news for Indiana, a state in need of those extra jobs. (Thanks J. Katz For The Tip) [IndyStar]

Chrysler and GM’s decisions to respectively kill and delay the ultimate poser’s cars, convertible muscle cars were made for the same reason: money. The unibody Challenger is, unbelievably, not originally engineered to lose its top. So engineering a model capable of retaining its rigidity is, due to the financiapocalypse, now considered wayyy to expensive. Speaking to Motor Trend, a company insider described the Challenger convertible as, “dead as a doornail.”

Bankruptcy-imminent GM simply can’t afford to roll out its 2010 Chevy Camaro convertible, even though plans for it were built in from the beginning. It’ll need to wait until the company either secures a massive loan, gets bought by the Chinese or sees significant profits from other products that have already been postponed before it can afford to put the Camaro convertible into production.

All this leaves the 2010 Ford Mustang sitting pretty. In addition to the convertible, they’ll show glass roof and coupe versions in LA, all of which go on sale next year. [via MotorTrend]

You think an 18-year-old minivan doesn't qualify for this series? Sure, I could have shot any number of mid-80s examples, but come on- look at the patina! This van has been taking a beating ever since Saddam Hussein crossed the line in the sand.


Also, it's clearly a parts runner for the primered Hell Project Alfa in the driveway. One of the side windows is a duct-tape/garbage bag combo, and some of the other windows are left open 24/7, rain or shine.


You could get a 100-horse 2.5 inline four in '90, but the emblems on this one indicate that the Mitsubishi 3.0 or 3.5 liter V6 (packing 142 or 150 horsepower, respectively) motivates this Alfa-parts-haulin' machine. And, yes, that's an early-60s Impala in the driveway next door.

According to the NY Times, the President would consider signing a stimulus package and help out the auto industry if Obama dropped his opposition to a free-trade agreement with Colombia. Maybe.

Mr. Bush indicated at the meeting that he might support some aid and a broader economic stimulus package if Mr. Obama and Congressional Democrats dropped their opposition to a free-trade agreement with Colombia, a measure for which Mr. Bush has long fought, people familiar with the discussion said.

The Bush administration, which has presided over a major intervention in the financial industry, has balked at allowing the automakers to tap into the $700 billion bailout fund, despite warnings last week that General Motors might not survive the year.

Conflicting reports have emerged, something that happens when you have two press corps — one following the President-current and one following the President-elect — but MSNBC is reporting that Bush has been friendlier to an automaker bailout. More information as we get it.

[Source: MSNBC]

I was a little sad to see the Imperial go, but I love the idea of this monster dropping anchor on some quaint cobblestone Central European street as the locals back away in awe. The Oakland warehouse of the shipping company is so close to Alameda that I was able to walk home after dropping off the Le Baron; BobAsh will have the privilege of driving about 475 miles from the dock to his town in the Czech Republic. I'm envious!


The shipper's parking lot is usually full of interesting cars on the first leg of their journey to Europe; Porsches and air-cooled VWs are most common, along with 50s and 60s Detroit iron. The afternoon I dropped off the Imperial, however, the only other Germany-bound car in the lot was this battered-but-still-majestic Mercedes-Benz 600. No doubt the insanely complicated hydraulic system in this machine has been dead for years, but all that stuff can be ripped out of a rusted-out German 600 and swapped into this oxide-free California car.

(Thanks for the photo James)

Some say he has a tattoo of a Saleen S7 on his rear end. Others tell us he was born with a penchant for oil rather than his mum's milk. All we know is he's called the Auto Insider and he's always ready to provide the scoop from the other side of Eight Mile.

Submit entries either in the comments section below or to autoinsider@jalopnik.com and please use the subject line “GM-Chrysler Mashup Photoshop Contest." Make sure to name your entry something unique so we can keep them all straight. As always, standard contest rules apply and submissions will be accepted until Wednesday, October 29, 2008, at 12:01 AM so we can vote for the winner later this week.

And oh yeah, "The Challamaro" — that's right below.
Good luck to all you ‘choppers!

A message to employees from Bob Nardelli

Dear Employees,

These are truly unimaginable times for our industry. We continue to be in the most difficult economic period any of us can remember. The combination of troubled financial markets, difficult credit, volatile commodity prices, the housing crisis and declining consumer confidence continues to weigh on the economy. Never before have auto industry sales contracted at such a fast rate. Throughout this challenging time for our industry and our company, we have continued to face the realities of our business environment. Working as a team, we have been right-sizing our organization to become as competitive as possible.

As business conditions today continue to decline, and we prepare for economic challenges extending into 2009, additional actions will be needed to re-size our company to remain competitive. Due to the unprecedented conditions in the auto industry, both in our home and international markets, we are targeting a 25 percent reduction in our salaried and supplemental work force. As always, we will strive to do this in a socially responsible way, with respect and gratitude to those who have contributed so much to our company over the years.

Your leadership team will receive the details on new voluntary programs today that will be made available to Chrysler salaried employees beginning in November. These new programs will be available to a broader group than before and will feature enhanced benefits, including both cash and new-vehicle vouchers. Your management will share all the program details with you in the next few days. I hope that every eligible employee takes time to seriously consider these enhanced offerings given the current environment. In addition, it will be necessary to have involuntary separation actions at the end of December, which is why the company is also issuing a WARN act notice today.

We need to work harder and more diligently to control every expense. To that end, we are eliminating in some cases, and cutting back on all discretionary and overhead expenses. Details of this initiative will be communicated through your leadership team. As an additional cost savings measure, we also will be reducing capital expenditures, but I assure you that we are protecting all major product programs.

As we re-size the company to reflect declines in volume, we know we must find new and more efficient ways to conduct our business operations. We recognize that in order to strengthen our competitive capability, and reduce the time and cost to achieve our objectives, we cannot operate as we have in the past. In the near future, we will be making organizational announcements as a result of restructuring actions reflecting the need to find new ways to operate, while still recognizing the importance of focusing on the customer, a relentless commitment to quality and investing in the programs that we need to compete in the marketplace.

I realize the appetite to know what the future holds for Chrysler is tremendous. Media speculation about our fate continues to be rampant. As a matter of company policy, Chrysler does not confirm or disclose the nature of its business meetings, in many cases to comply with legal requirements, as well as protect the integrity of our Company and those with whom we meet. When erroneous reports can be corrected with definitive answers, I support dealing with these issues in a clear and direct manner. I want to assure you that your leadership team is committed to communicating fully and directly to you if, and when, there is something to announce.

The Chrysler team has been through tremendous change over the years through the many ups and downs of this industry. During these tumultuous times, I encourage you to help each other to keep a sharp focus on the important tasks at hand.

Thank you for your continued dedication.

Bob

[via Chrysler

This car was a one-owner, estate-sale find. The late owner was a San Francisco chiropractor who garaged it, had it serviced on the dot, and (apparently) never allowed anyone to sit inside. It's got a few minor dings and dents, but almost everything works and the (purple whorehouse-esque) interior is the nicest I've ever seen on an unrestored 90,000-mile car.
It's not what you would ever call fast, but the 335-horse 440 gets its 4,855 pounds moving pretty well. Yes, this voluminous dreadnaught is almost - but not quite- a thousand pounds heavier than the bloatmaster 2010 Camaro SS.
I'll be bringing this mighty luxury machine over to the Port Of Oakland for shipping to Bremerhaven as soon as all the spare parts I've ordered finally arrive. Don't feel bad about its leaving the country of its birth; it shall be worshiped as a god in its new home!

"I don't have anything specific I want to talk about at this point," he said. "There may be ways (to help a merger) ... but I better leave it at that."

Levin obviously has his own ideas about how to facilitate a GM/Chrysler deal. Whether he's thinking low-interest loans — more of them — or something more akin to the recent banking deal that saw the federal government gain minor stakes in the companies themselves remains to be seen. But at this point, we're not sure the federal government is in any better shape than GM or Chrysler. [Detroit News]

So what's Nardelli got to say about life, liberty and the pursuit of less losses for Cerberus? Here's the full transcript of his exclusive interview with CNBC's David Faber:

CNBC EXCLUSIVE: CNBC TRANSCRIPT: CNBC'S DAVID FABER SITS DOWN
WITH ROBERT NARDELLI, CHRYSLER CHAIRMAN & CEO, TODAY ON CNBC'S "WALL
STREET CRISIS: IS YOUR MONEY SAFE?"

WHEN: Today, Thursday, October 16th at 8:40PM ET

WHERE: CNBC's "Wall Street Crisis: Is Your Money Safe?"

Following is the unofficial transcript of a CNBC EXCLUSIVE interview
with Robert Nardelli, Chrysler Chairman & CEO.

All references must be sourced to CNBC

—-—-—-—-—-—-—-—-—-—-—-—-—-—-—-—-—-—-—-—-—-

FABER: THANK YOU MARK. YEAH WE ARE HERE ROBERT NARDELLI. MR. NARDELLI
THANKS FOR JOINING US.

NARDELLI: THANK YOU. IT IS GREAT TO BE HERE.

FABER: ON THIS LOVELY EVENING WITH THE CRICKETS WITH THE BACKGROUND. LET
ME START OFF WITH THE HEADLINES THAT WE'VE BEEN TALKING ABOUT, PEOPLE
HAVE BEEN SEEING, AND WE'VE BEEN TALKING ABOUT FOR MORE THAN A WEEK NOW.
ARE YOU IN TALKS WITH GENERAL MOTORS? IS IT POSSIBLE CHRYSLER WILL GET
PURCHASED BY GM?

NARDELLI: AS YOU KNOW, OBVIOUSLY, WE DON'T COMMENT ON THOSE RUMORS OR
SPECULATION, DAVID, BUT I THINK IF YOU LOOK AROUND THE GLOBE, TODAY THEY
ANNOUNCED IN CHINA A CONSOLIDATION. OBVIOUSLY, THERE'S GOING TO BE
SPECULATIONS.WE'VE BEEN VERY OPEN ABOUT LOOKING FOR PARTNERS AND
CREATING ALLIANCES, VERY IMPORTANT FOR US. WE ANNOUNCED THE ONE WITH
NISSAN THAT WOULD GET US INTO A "B" PLATFORM, A SMALLER-SIZED VEHICLE.
IS IT SOMETHING WE CAN'T DO? SURELY NOT. WE HAVE GREAT ENGINEERS, WE'VE
GOT GREAT TECHNOLOGY TO BE ABLE TO DO IT, BUT RIGHT NOW IT'S A RACE.
IT'S A RACE TO MAKE SURE WE CAN RESPOND TO AN UNPRECEDENTED CHANGE IN
THE INDUSTRY AND CONSUMER DEMAND BY DOWNSIZING. SO BY BEING ABLE TO FORM
THESE ALLIANCES OR CREATE THESE PARTNERSHIPS, WE'RE TRYING TO FILL OUR
PORTFOLIO TO SUPPORT OUR DEALERS TO BE MORE RESPONSIVE TO OUR CUSTOMERS.

FABER: THERE ARE SOME WHO SAY THAT THERE ARE A LOT OF BENEFITS FROM
CONSOLIDATION, FROM A GM AND CHRYSLER, THE SYNERGIES WOULD BE
CONSIDERABLY VERY LARGE. DO YOU AGREE?

NARDELLI: WELL, I THINK IF YOU LOOK AT THE U.S. INDUSTRY, WE STARTED THE
YEAR AT ABOUT 16.6 MILLION UNITS. WE FINISHED LAST MONTH AT 12.8. THE
PIN NUMBERS TODAY ARE AROUND 12 MILLION UNITS. I THINK IT JUST,
CERTAINLY, CREATES AN ENVIRONMENT FOR CONSOLIDATION, WHERE YOU CAN GET
SYNERGIES OF PRODUCTIVITY THAT WILL ALLOW YOU TO BE MORE COMPETITIVE,
NOT ONLY HERE IN THE U.S. MARKET, BUT ON A GLOBAL BASIS.

FABER: TO THE EXTENT — AND I REALIZE YOU'RE NOT GOING TO COMMENT ON THE
TALKS, PER SE, TO THE EXTENT THERE ARE ANY, BUT WHEN THOSE KINDS OF
TALKS OCCUR,THEY CAN ALSO BE DISTRACTING. FOR MANAGEMENT, AND
POTENTIALLY FOR EMPLOYEES. ASSUMING THERE ARE TALKS GOING ON, IS IT
SOMETHING THAT YOU WOULD APPROACH AND THEN WANT TO TRY TO GET AN ANSWER
TO IN A FAIRLY RAPID FASHION?

NARDELLI: LET ME JUST SAY, I COULDN'T BE PROUDER OF OUR ORGANIZATION.
THEY HAVE GONE THROUGH A TREMENDOUS LEVEL OF ANXIETY. REMEMBER, THEY
FORMED A MERGER OF EQUALS, IF YOU WILL, A WHILE BACK. AND THEN ALL
OPTIONS WERE PUT ON THE TABLE IN SOME TIME, FEBRUARY, MARCH OF LAST
YEAR, AND THEN WE CONSUMMATED THE DEAL, IF YOU WILL, WITH CERBERUS.
AGAIN, I COULDN'T BE HAPPIER WITH CERBERUS AS OUR OWNERS AND STEVE
FEINBERG HAS BEEN ABSOLUTELY WONDERFUL TO WORK WITH, THE ENTIRE
ORGANIZATION. SO OUR PEOPLE HAVE GONE THROUGH TREMENDOUS ANXIETY.
THEY'VE SEEN THE PEAKS, THEY'VE SEEN THE VALLEYS. NOT ONLY RECENTLY, BUT
THE HISTORY OF CHRYSLER, DAVID, AS YOU KNOW, HAS BEEN ONE OF A LITTLE
BIT OF A ROLLER COASTER RIDE, WHERE WE'VE ALWAYS MANAGED TO COME OUT
WITH SOME BOLD, INTIMIDATING, COMMANDING DESIGNS. NEW TECHNOLOGIES,
INNOVATIVE SOLUTIONS TO WHAT CUSTOMERS ARE LOOKING FOR. SO I THINK OUR
PEOPLE ARE VERY RESILIENT. AND WE JUST KEEP REASSURING THEM THAT OUR
RESPONSIBILITY IS TO RETURN CHRYSLER TO PROFITABILITY. WE FOCUS ON THAT
EVERY DAY. WE DO THAT BY MAKING SURE THAT WE'VE GOT GREAT PRODUCT
CADENCE. WE MAKE SURE THAT WE'RE INVESTING HEAVILY IN QUALITY. THAT OUR
QUALITY TODAY IS BETTER THAN YESTERDAY. NOT AS GOOD AS IT'S GOING TO BE
TOMORROW, SO THAT WE CAN REALLY CHANGE THE IMAGE, THE REPUTATION, THE
RELIABILITY, THE DURABILITY OF OUR VEHICLE, THAT THEN SUPPORTS OUR
DEALER NETWORK. A STRONG DEALER NETWORK, A LOYAL DEALER NETWORK, AND
THEN TRY TO RESPOND TO CONSUMER DEMAND.

FABER: LET'S TALK ABOUT SOME OF THE OTHER THINGS GOING ON RIGHT NOW. THE
PRICE OF OIL HAS DROPPED PRECIPITOUSLY. ONE WOULD IMAGINE THAT MIGHT BE
GOOD NEWS FOR YOUR INDUSTRY. ONE MIGHT IMAGINE THAT, BUT I CAN ALSO
IMAGINE IN THIS ENVIRONMENT, IT MIGHT NOT BE THE CASE.

NARDELLI: I THINK IN A NORMAL ENVIRONMENT, WE'D BE DOING A DANCE RIGHT
NOW AT UNDER $70, YOU KNOW, AROUND $3 PER GALLON. OBVIOUSLY, WHEN OIL
SPIKED, GASOLINE PRICES WENT UP TO $4. WE THOUGHT THAT WAS GOING TO BE
OUR BIGGEST CHALLENGE IN 2008.IF YOU THINK ABOUT AN ECONOMY THAT'S IN
TURMOIL, IF YOU THINK ABOUT AN INDUSTRY THAT'S SPIRALING DOWNWARD, $4 A
GALLON GAS HAS REALLY BEEN DWARFED BY THIS WHOLE ISSUE NOW OF CREDIT
AVAILABILITY FOR OUR CONSUMERS, CONSUMER CONFIDENCE, CONSUMERS' ABILITY
TO ACTUALLY GET INTO A VEHICLE. YOU'VE SEEN SOME FINANCING ARMs TODAY
ANNOUNCE, UNLESS YOU HAVE A FICA SCORE OF ABOUT 700, YOU WON'T QUALIFY.
A LOT OF NORMAL CUSTOMERS OUT THERE TODAY, DAVID, ARE 650, 670. AND SO
THOSE THAT HAVE ENOUGH INITIATIVE, ENOUGH CONFIDENCE TO BUY A VEHICLE
MAY FIND THEMSELVES NOT QUALIFYING FOR A VEHICLE.

FABER: SO YOU'RE SAYING THAT DESPITE THIS INCREDIBLE DROP IN OIL, WHICH
ONE WOULD IMAGINE WOULD BE GOOD NEWS FOR YOUR POTENTIAL BUYER, THE
CREDIT PROBLEM IS DWARFING THAT?

NARDELLI: I THINK, NUMBER ONE, IT'S PARAMOUNT IN THE CONSUMER MIND RIGHT
NOW. I THINK IT'S THE BIGGEST CHALLENGE THAT WE'RE FACING RELATIVE TO
OUR DEALER NETWORK, TO MAKE SURE THAT WE CAN CONTINUE TO FINANCE THEM ON
THE WHOLESALE BASIS, THAT THEY STILL HAVE GOOD ACCESS TO RETAIL
FINANCING, AND SO WE'RE WORKING VERY HARD RELATIVE TO INCENTIVES TO MAKE
SURE THAT OUR CONSUMERS CAN GET INTO OUR VEHICLES. WE TRIED THAT EARLIER
THIS YEAR WITH REFUELING AMERICA.SO WE HAVE A LASER FOCUS ON OUR DEALERS
AND OUR CONSUMERS, OUR CUSTOMERS TO TRY TO COME UP WITH SOLUTIONS,
CREATIVE SOLUTIONS, KIND OF OUT-OF-THE-BOX SOLUTIONS. BECAUSE AS A
PRIVATE EQUITY COMPANY, WE HAVE THE ABILITY TO DO THINGS IN SOMEWHAT OF
AN UNTRADITIONAL MANNER.

FABER: HOLD IT THERE. WE'RE GOING TO BE RIGHT THERE. I WANT TO TAKE A
BREAK AND WE'LL CONTINUE TO TALK WITH BOB NARDELLI, CHAIRMAN AND CEO OF
CHRYSLER

FABER: WELCOME BACK TO CNBC, I'M DAVID FABER HERE IN KIAWAH ISLAND,
SOUTH CAROLINA, WHERE THE BUSINESS COUNCIL IS TAKING PLACE. I'VE BEEN
SPEAKING TO BOB NARDELLI, THE CHAIRMAN AND CEO OF CHRYSLER. WE'VE BEEN
TALKING ABOUT THE IMPACT THE CREDIT CRISIS HAS BEEN HAVING ON YOUR
BUYERS, WHO ARE UNABLE TO GET CREDIT TO BUY AUTOMOBILES. YOU MENTIONED
16.6 MILLION AUTO SALES. WHERE ARE WE HEADED? SOME SEE US HEADED AS LOW
AS 13 MILLION. IS THAT REALLY A POSSIBILITY?

NARDELLI: I THINK THAT'S A VERY REAL POSSIBILITY. DAVID, WE STARTED THE
YEAR AT ABOUT 16.6. LAST NOVEMBER, TRYING TO PUT TOGETHER A VERY
AGGRESSIVE, CONSERVATIVE PLAN FOR CHRYSLER, WE KIND OF PEGGED IT AT
15.5. SO WE THOUGHT WE WERE IN PRETTY GOOD SHAPE THROUGH THE FIRST
QUARTER. THEN WE SAW THIS UNPRECEDENTED AND PRECIPITOUS SPIRALING
DOWNWARD. LAST MONTH WE ENDED WITH SEASONALLY ADJUSTED RATE OF ABOUT
12.8. AGAIN, THERE ARE FORECASTS OUT THERE THAT THE YEAR COULD END AT 13
MILLION. RIGHT NOW THE PIN NUMBERS HAVE US JUST SLIGHTLY ABOVE 12
MILLION. SO JUST IMAGINE THE VOLUME CONTRACTION, JUST IN THE U.S.
MARKET.

FABER: THAT'S SHOCKING. THAT'S OVER 4.5 MILLION CARS.

NARDELLI: IT IS. SO JUST TO PUT THAT INTO CONTEXT, THAT'S AS BIG AS ONE
OF THREE MANUFACTURERS IN DETROIT IS TODAY. SO WE'VE HAD TO,
UNFORTUNATELY, TAKE OUT ABOUT 1.1 MILLION EQUIVALENT UNITS OF CAPACITY.
WE'VE HAD TO AFFECT WELL OVER 25,000 FAMILIES AS A RESULT OF HAVING TO
RESIZE TO MAKE SURE THAT WE CAN BE COMPETITIVE THROUGH THIS TROUGH AND
COME OUT THE OTHER BIGGER, STRONGER, AND MORE FORMIDABLE. ONE OF THE
MOST GUT WRENCHING PARTS OF THIS JOB RIGHT NOW IS TO AFFECT PEOPLES
LIVES. YOU KNOW, PEOPLE WHO ASPIRE TO HOMES AND COLLEGE EDUCATIONS AND
SO FORTH. SO IT'S REALLY ONE OF THE MOST CHALLENGES PARTS THAT I'VE HAD
TO GET MY ARMS AROUND IN THE LAST YEAR SINCE I'VE BEEN WITH —

FABER: MANY CONSUMERS HAVE WATCHED THE STOCK MARKET DIVE OVER THESE LAST
THREE WEEKS, OCTOBER HAS BEEN WORSE THAN SEPTEMBER. I'VE BEEN SPEAKING
TO PEOPLE VERY CLOSE TO CONSUMER-RUN COMPANIES AND THEY SAY THEY'VE SEEN
A PRECIPITOUS DECLINE SINCE THE END OF SEPTEMBER. ARE YOU SEEING SIMILAR
KINDS OF THINGS?

NARDELLI: I THINK CERTAINLY IN THE FIRST COUPLE OF WEEKS OF OCTOBER.
WHAT I PROVED, DAVID, NO ONE IS IMMUNE FROM THIS ECONOMIC CRISIS THAT
WE'RE IN RIGHT NOW. I SAW YOU AND JOHN THIS MORNING, YOU KNOW, ON YOUR
SEGMENT, AND I THINK HE FRAMED IT VERY APPROPRIATELY. I THINK YOU ASKED
HIM IF WE WERE HEADED FOR A RECESSION. HE SAID, I THINK WE'RE IN ONE.
AND SO I THINK WE'RE SEEING, AGAIN, AN UNBELIEVABLE CONTRACTION. AND
OBVIOUSLY THE SPECULATION AND THE RUMORS AROUND THAT IS KIND OF DUE
COURSE. IT'S NORMAL ANY TIME YOU HAVE THIS KIND OF ECONOMIC PRESSURE,
YOU'RE GOING TO SEE CONSOLIDATIONS, YOU'RE GOING TO SEE PARTNERSHIPS,
ALLIANCES TO TRY AND OPTIMIZE AND GET PRODUCTIVITY AND SYNERGIES OF
TECHNOLOGY.

FABER: BUT YOU DON'T KNOW WHERE YOU'VE GOT TO OPTIMIZE YOUR COSTS ARE
WHEN YOUR IN DEMAND IS VARYING SO MUCH. IT MUST BE VERY DIFFICULT.

NARDELLI: IT'S VERY CHALLENGING, PARTICULARLY IN THIS INDUSTRY BECAUSE,
YOU KNOW, OBVIOUSLY IT'S NOT A MATTER OF JUST CANCELING AN ORDER. YOU
KNOW, TO STOCK A SHELF AS IN RETAIL. WE'VE MADE HUGE CAPITAL INVESTMENTS
IN EXCESS OF BILLIONS OF DOLLARS FOR A LOT OF THESE PLATFORMS. AND SO
WHEN YOU HAVE TO DOWNSIZE, OBVIOUSLY YOUR AMORTIZATION ON THE PHYSICAL
CAPITAL IN OUR FACILITIES, WORKING WITH THE SUPPLIER NETWORK IS
EXTREMELY CHALLENGING, DAVID.YOU KNOW, WHEN WE DID THE DUE DILIGENCE ON
CHRYSLER, WHAT WE SAW THERE'S ABOUT 1 MILLION PEOPLE DEPENDING ON OUR
SUCCESS.

FABER: IN TERMS OF ALL OF THE SUPPLIERS.

NARDELLI: YOU LOOK AT NOT ONLY OUR DIRECT EMPLOYEES. YOU LOOK AT THE
DEALER NETWORK, 3,600 DEALERS AND THEIR FAMILIES, THE SUPPLIERS, THE
LOGISTICS, THE TRANSPORTATION, IT'S A HUGE RESPONSIBILITY. AND I HOPE
THAT THE GENERAL PUBLIC, I HOPE THAT OUR LEADERS IN WASHINGTON
UNDERSTAND THE IMPLICATIONS OF THE PRESSURE THAT THE INDUSTRY IS UNDER
RIGHT NOW. AND CERTAINLY IT'S GONE FROM HOUSING TO BANKING AND I THINK,
UNFORTUNATELY, TRANSPORTATION IS FEELING THE BLUNT OF BOTH OF THOSE
SECTORS.

FABER: I WANT TO END ON THAT. AND LET ME QUICKLY ASK YOU, IN 1979,
CHRYSLER GOT BAILED OUT BY THE FEDERAL GOVERNMENT. $1.5 BILLION, A VERY
SMALL SUM IN CURRENT TERMS. IS IT POSSIBLE YOU'RE GOING TO NEED THE HELP
OF THE FEDERAL GOVERNMENT AGAIN?

NARDELLI: WELL, I THINK THAT REMAINS TO BE SEEN. WE'RE DOING EVERYTHING
WE KNOW HOW TO DO. WE'RE LOOKING AT EVERY LINE ITEM WHILE AT THE SAME
TIME TRYING TO MAKE SURE THAT WE CONTINUE A VERY STRONG PRODUCT CADENCE.
WE'RE WORKING VERY HARD TO MAKE SURE WE'RE COMPLIANT WITH THE CAFE
STANDARDS THAT HAVE PUT A TREMENDOUS FINANCIAL BURDEN ON THE AUTO
INDUSTRY. WE FULLY SUPPORT, DAVID, ENERGY INDEPENDENCE. WE SUPPORT THE
NEED FOR ENVIRONMENTAL IMPROVEMENTS, WE'RE DRIVING HARD ON INNOVATION
AND TECHNOLOGY TO MEET BOTH OF THOSE THINGS. WE HAVE TO BE VERY CAREFUL,
THOUGH, HOWEVER, AS WE TRY TO GAIN INDEPENDENCE ON OIL. WE'VE GOT TO
MAKE SURE THAT WE DON'T BECOME DEPENDENT ON BATTERIES. OUR ENVY PROGRAM
WITH ELECTRIC VEHICLES, WE HAVE TO MAKE SURE WE'RE SUPPORTING
FINANCIALLY, WORKING WITH THE ENTREPRENEURS TO CREATE THE BATTERY
TECHNOLOGIES HERE IN THE U.S. THAT ALLOWS US TO BE SELF-SUSTAINING.

FABER: WE HAVE TO END IT THERE. OKAY. BOB, THANK YOU VERY MUCH.

NARDELLI: THANK YOU.

Gerald Meyers, former AMC chairman turned U of M business professor says, "The others (automakers) will be delighted to have Chrysler just die and take 1.5 million units out of the industry, which is about what the excess is." And indeed, the elimination of a major automaker may be precisely what's needed to right-size the industry. But the nationwide cost in terms of lost jobs and plant closures would be massive.

GM and Chrysler are both struggling with overcapacity and an oversupply of dealerships; combining the two would simply give the resulting entity an excuse to shed tremendous redundancy in one fell swoop. Problem is, most of those redundant assets have families to feed and bills to pay; the impact to Michigan's already-fragile economy would be devastating, but every state in the union would feel some of the effects.

So what do you to if you're GM? Save yourself at the expense of tens of thousands of jobs? Would the result lead to a GM that's healthy and profitable again, or would it stave off the inevitable bankruptcy filing and lead to a generation of ill-will toward the automaker from families ruined by its scorched-earth takeover of Chrysler? We don't know the answer, but we certainly hope GM's corporate captains are asking the hard questions before making any far-reaching moves. [Detroit News]

We can't help but point out that this statement came the same day that Tesla announced it was going to scale back Tesla Model S production plans until a government loan guarantee becomes effective. Though we fully believe that the Model S from Tesla is undergoing development and have our doubts about the electric Chryslers, this does seem a bit like the electric pot calling the electric kettle black.

2008 SEMA Mopar Underground Sneak Peek

Dodge Challenger Blacktop
A menacing creation from the minds of the Mopar Underground design team. The Dodge Challenger Blacktop began life as a 2009 Dodge Challenger R/T equipped with a 5.7-liter HEMI® V-8 and six-speed manual transmission. Mopar Underground added custom-made spoilers and front brow. To finish off the look, a black-on-black racing stripe paint scheme was added. The “in the weeds” stance and superb handling characteristics are accomplished by the Mopar coil-over suspension and strut tower brace. Blacktop rolls on massive 22-inch Dodge Viper wheels from Factory Reproductions wrapped in Dunlop tires measuring 265/35 R22 front and 305/30 R22 rear. To ensure the powertrain can keep up with the suspension, underhood performance is enhanced. The addition of Mopar components, including a cat back dual-exhaust, cold air intake, allow the HEMI V-8 to breathe easy. The interior has been enhanced with Katzkin leather seating finished in bright red plus a Mopar Kicker audio system for premium sound.

Dodge Challenger Targa
The Dodge Challenger Targa is a full-blown competition car that raced and completed the infamous Targa Newfoundland race this year. “Samantha” started life as a Mopar Challenger drag race package car. Many features were borrowed from the Dodge Viper, but the most noticeable is the snakeskin green paint. To keep the front end down, a Mopar chin spoiler "Splats“ developed in a full scale wind tunnel, was added to the front of the car. Mopar gauges keep a close eye on the vital signs. The Mopar hood is equipped with a scoop to make room for the 540-horsepower, 490 lb. ft. of torque, 392 HEMI® V-8 Mopar crate motor. Mated to a Tremec six-speed manual gearbox, the engine blasts power to the rear wheels through a production 2009 modified gear ratio in the rear end. An abundance of fade resistant stopping power comes from Stop-Tech brakes. Up front, the six-piston calipers clamp 380-millimetre rotors, while in the rear, four-pot calipers work with 355-mm rotors. Developed by KW, the race suspension and brake upgrades came from a proven hero — the Dodge Viper ACR, which just broke the production car lap record at the world-renown Nurburgring in Germany. With only a few exceptions, the Dodge Challenger Targa was built using parts available through Mopar.

Dodge Ram TRXtreme
The 2009 Dodge Ram TRXtreme plays up the off-road capabilities of the 2009 Ram TRX package. Starting life with a quad cab TRX-4 off-road truck, it was easy to upgrade this truck to a serious off-road machine. Mopar Underground design team added 4.5-inches of extra ground clearance using a Mopar lift kit. This made room for Mopar polished and forged 20-inch wheels wrapped in knurly BFG 37X12.50’s. The paint is a bright yellow and mineral grey two-tone incorporating a mud splash theme. A set of Mopar wheel flares, a wheel-to-wheel Mopar tube step and a box rail are painted to match the theme. Rearward visibility comes from the Mopar aftermarket telescoping mirrors, which extend when needed. The one-off steel hood with cooling louvers and larger grille take care of any heat issues that may arise under severe use. A bed accessory system from Mopar holds off-road gear and a Mopar tuned dual exhaust system gives an impressive growl. Interior features include a Mopar navigation system, DVD headrests and Mopar leather seats by Katzkin.

Dodge Ram R/T
The Dodge Ram R/T starts off with a 2009 Ram Sport with a 380-horsepower, 5.7-liter HEMI® V-8, a 4.10 gear and a high stall converter, which rockets the truck to impressive times. With this blank canvas, Mopar Underground created a Dodge Challenger-inspired version of the Dodge Ram. On the performance side, a Mopar cold-air intake kit to keep the engine breathing and a Mopar dual exhaust system with a performance rumble. The exterior is painted classic B5 blue with a Mopar dual-snorkel aluminum hood and carbon fiber accent stripes. Dropped chassis is possible with a concept Mopar air suspension kit. The look is made more evident by the body kit, consisting of sill and box pieces, finished up with a chin spoiler. For wheels, concept Mopar 22-inch Alcoas wrapped in 285/45R22s in front and 305/40R22s in the rear. A Mopar hard tonneau cover and a unique integrated spoiler are combined with the Mopar bed mat showing an ambient under-rail LED lighting system. The interior features Katzkin leather seats with body color stitching to match the instrument panel and steering wheel. A set of Mopar Pedals are installed, adding to the performance look and capability

Dodge Ram Sportsman
The most noticeable aspect of the 2009 Dodge Ram Sportsman is the unique blowing-leaves paint scheme inspired by a new interpretation of traditional camouflage designed by Mopar Underground. The paint is protected by a set of accent Mopar wheel flares and running boards with an integrated step. The Sportsman features Dodge’s exclusive RamBox storage system, filled with plenty of outdoor gear, and the bed rail system holds a cargo rack for additional cargo capacity. The Mopar telescoping trailer tow mirrors aid in rear visibility and match the color theme. The vehicle gets the right stance and added capability with a Mopar two-inch lift kit supported by Mopar polished and forged 20-inch wheels with 33-inch tires. You’ll never get lost with the Mopar navigation unit, but if you do you will be able to enjoy SIRIUS® Satellite TV or movies on the Mopar headrest DVD system. Sit back and relax in the perforated leather Mopar seats by Katzkin, embroidered with the Sportsman logo. The steering wheel and door pulls have been trimmed to match, and the Mopar ambient lighting system gives a unique glow to the interior.

Dodge Ram Mopar Street Package
Using a 2008 Dodge Ram Sport, the exterior blackberry paint really plays up the Dodge Ram Mopar Street Package. This Mopar Underground concept truck features a Mopar body kit consisting of sill extensions and a chin-spoiler. A slight Mopar body drop/leveling kit and Mopar concept 22-inch polished Alcoa forged wheels add to the appearance. A Mopar high-style hard tonneau cover blends with the truck. To add to the aggressive look, the Mopar all-aluminum dual-snorkel hood sits over the 390-horsepower HEMI® V-8, which is backed with a Mopar tuned dual-exhaust. The theme is continued in the interior with Mopar ambient lighting. Mopar suede and leather seats trimmed with premium piping and stitching add to the high-end feel of the truck. The steering wheel and door pulls are trimmed to match for a complete package. Entertainment is delivered via a Mopar DVD headrest system and a Mopar-kicker audio system that will blow you away. The bed is also dressed with a Mopar bed rug and under-rail accent LED lighting.

In concept