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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.

Vin Diesel and Dodge finally make the partnership official

Thanks to The Fast and the Furious franchise, actor Vin Diesel is nearly synonymous with muscle cars, in particular those from Dodge and SRT. The partnership is finally official, with Diesel appearing in a number of new ads for the automaker. Three new spots, titled "Rally Cry," "Monsters," and "Shepherd," showcase Dodge's entire product line, including the nearly forgotten Journey crossover. We can only assume it's taken the Viper's place in the automaker's lineup, as the soon departed coupe is nowhere to be seen. This content is hosted by a third party. To view it, please update your privacy preferences. Manage Settings. Another missing element is the recently revealed Dodge Demon. Presumably, Dodge felt three months of teasers and a good bit of New York Auto Show coverage were sufficient advertisement for the car. Plus, we can't count on the Demon to go around a corner the same way that some of the cars in this ad do. It's hard to turn with two wheels in the air. This content is hosted by a third party. To view it, please update your privacy preferences. Manage Settings. Advertisement or not, it's always great to hear a soundtrack of big, V8 muscle. Plus, this only further feeds into Vin Diesel v. The Rock, as the latter has been promoting Ford products for the past few years. Related Video: This content is hosted by a third party. To view it, please update your privacy preferences. Manage Settings.

Dodge bringing revamped Challenger, Charger to Big Apple

The 2014 New York Auto Show will be a big one for Dodge, as the brand has announced that refreshed versions of the 2015 Challenger and 2015 Charger will debut at the show. This is a particularly big deal for the two-door Challenger which, visually, has remained unchanged since is burst back onto the scene in 2008 and helped reignite the muscle car wars.
As a sort of hint, this announcement was accompanied by the picture you see above - the Super Bee logo in the Challenger's new instrument cluster. According to Dodge, the New York debut of a new "powertrain combination" - possibly with the high-output Hellcat V8 - will leave enthusiasts "abuzz."
As for the Charger, Dodge is promising a full redesign that should be a significant departure from the blunt, angry looks of the current model. At this point, there's no indication that the Challenger's new powertrain could be fitted to the Charger, although considering how mechanically similar these two vehicles have been, it doesn't seem outside the realm of possibility.