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Fiat Chrysler dumped 40,000 unordered vehicles on dealers

In a move that echoes recent history, Fiat Chrysler has been making more cars and trucks than dealers in the U.S. are willing to accept, with Bloomberg reporting that at one point the automaker had built up a glut of around 40,000 unordered vehicles. That’s led some dealers to accuse FCA of reviving the dreaded “sales bank” accounting practice of obscuring inventory to improve the balance sheet. The company reportedly began building up its inventory of unordered cars this summer despite an industrywide slowdown in sales and an eagerness by some dealers to thin their inventories because rising interest rates are making it more expensive to hold unsold cars. The inventory build-up also coincided with Fiat ChryslerÂ’s efforts to find a merger partner, first with Renault, which fell through, then last monthÂ’s announcement that it will merge with FranceÂ’s PSA Group. FCA denies any such scheme and tells Bloomberg the rising inventory is down to a new predictive analytics system designed to better square supply with demand from dealers that is helping the company save money and narrow the numbers of unsold vehicles. The company recently agreed to pay a $40 million civil penalty to the U.S. Securities and Exchange Commission to settle a complaint that it paid dealers to report fake sales figures over a span of five years. While no one is suggesting that FCA is in dire financial straits — the company saw higher than expected earnings in the third quarter and record profits in North America — the practice has strong historical precedent by Chrysler, which built up bloated inventories in the run-up to its two federal bailouts, in 1980 and 2009. It was also common at GM and Ford during the 2000s, when all three Detroit automakers struggled with excess manufacturing capacity and plummeting sales in the lead-up to the Great Recession. Back in 2012, CFO Magazine wrote about a report that explained automakersÂ’ rationale for the practice and how it works: Say fixed costs for a given factory are $100, and that the factory can make 50 cars. Consumers, however, demand only 10. Under absorption costing, if the company makes all 50 cars, its cost-per-car is $2. If it makes only up to demand, or 10 cars, the cost-per-car is $10. Although each car adds variable costs for steel and other parts, if those costs are low, the company still has an incentive to make more cars to keep the cost-per-car down.

Chrysler recalling over 280k minivans because airbags may deploy on wrong side

Chrysler has issued a recall for some 2013 Town & Country, Dodge Grand Caravan and Ram C/V Tradesman vans built between May 10, 2012 and June 7, 2013. These vehicles may have a software error that would cause the wrong side (opposite side) airbags to deploy in a crash. With this defect, a left-side impact would cause the right-side airbag to deploy, etc.
The recall affects 281,500 vehicles in total: 224k in the US, 49,300 in Canada, 2,900 in Mexico and 5,300 in other locations. Chrysler will notify owners of effected vehicles, and reflash the offending occupant restraint control module to resolve the issue. Scroll down to read the National Highway Traffic Safety Administration press release.

We're pretty sure the Challenger SRT Demon won't have 1,121 horsepower, but what if?

Dodge's slow rollout of the upcoming Demon continues, and with it comes endless speculation about what it all means. Every video, every image, and every press release contains some clue that points towards the Demon's final specs. We don't think any of it is random or arbitrary. This week cryptic image, a small plate with a name and two numbers, shows us a little more than last week's license plate. Unfortunately, Dodge will neither confirm or deny anything, meaning we have no way of knowing which rabbit hole to go down. Don't expect to see official horsepower, a quarter-mile time, or an MSRP until the New York Auto Show. The plate is attached to the crate of goodies that comes along with every Dodge Demon. This particular one is labeled with three things: Tom Coddington, serial number 0757, and VIN 001121. The name is simple enough. According to Hot Rod, Coddington was one of the original Ramchargers, a group of engineers in the early 1960s that helped Dodge get involved in drag racing. He was a fuel system specialist, motor consultant, and a rotating garage manager. All of that could be clues. While a name is easy enough to Google, the two numbers can't be broken down so easily. The crazier theory is that the car makes 1,121 horsepower and will do the quarter-mile in 7.57 seconds. Frankly, those numbers are about as likely as the Demon actually being powered by a Rolls-Royce turbofan engine from a Boeing 757 or packing a carburetor with 1,121 CFM. The Demon is going to be street legal, and the costs associated with making a 1,121-hp car meet emissions standards alone are assuredly astronomical. As our friends from Road & Track pointed out, the more likely theory is that 757 is actually the horsepower rating. This seems totally plausible, but it means we still don't know what 1,121 means. Surely it's not a drag strip time, as the standard Hellcat will do 1/4 mile in 11.2 seconds. Like before, if you have any ideas, post them in the comments. Until April, we'll keep trying to solve Dodge's demonic puzzle. Related Video: This content is hosted by a third party. To view it, please update your privacy preferences. Manage Settings. News Source: Road & Track, Hot RodImage Credit: FCA New York Auto Show Dodge Coupe Performance dodge demon dodge hellcat