2014 Jeep Wrangler Unlimited Sport on 2040-cars

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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 31k SUVs and vans

Chrysler is issuing recalls covering roughly 31,700 vehicles worldwide due to two separate problems. In both cases the company believes that most of the affected vehicles are either still on, or in transit to, dealer lots.
One recall covers roughly 10,700 Dodge Durango, Jeep Cherokee, Grand Cherokee and Grand Cherokee SRT models from the 2014 model year built between January 16 and April 17, 2014. The SUVs need a software update for the cruise control. It's possible that when the cruise is on and the driver presses on the throttle, the acceleration could last a second after the pedal is released or two seconds for the SRT. Afterward, they return to the speed originally set by the driver.
Chrysler says it isn't aware of any accidents, injuries or even reported incidents of this happening in the real world. Also, in all cases, if the driver presses on the brake, the cruise shuts off. The automaker believes that there are about 6,100 affected SUVs in the US, 950 in Canada, 425 in Mexico and 3,200 outside of North America. The software upgrade will be ready shortly, the company says.

Jeep CEO a fan of pickup redux

The idea of a Jeep pickup is a hardly a new concept. After all, putting a bed on the company's rugged off-roaders goes back to the '40s, not to mention the more recent Cherokee-based Comanche. There's a very slim chance that a truck could return to the lineup down the line if brand CEO Mike Manley gets his wish. "I remain a big fan of a Jeep pickup. I think we have history that says it belongs in our portfolio," Manley said to The Detroit News. However, there's no need to get any hopes up soon, because a truck doesn't get any mention in the brand's five-year plan. That puts the earliest possible introduction around 2019. Even Manley is tempering expectations. "At this moment and time, I have higher priorities. That doesn't mean to say that we don't work on it, we're not looking at it," he said to The Detroit News. The most likely candidate to support a future Jeep truck is the next-gen Wrangler, according to The News. The rest of FCA's pickups and SUVs are running at capacity, which makes slipping in another variant difficult. However, the future Wrangler is heavily rumored to get an expanded production facility in Toledo, OH, which could make things possible. Anonymous FCA insiders confirmed to Autoblog that the next-gen Wrangler would be offered with a 3.0-liter EcoDiesel V6 and eight-speed automatic. It's also reportedly using solid axles at the front and rear, a fixed windshield and an aluminum body. That could make for a very fun and practical off-roader. If reading all of this speculation gives you a twinge of deja vu, it should. After the Jeep Gladiator concept (pictured above), there were years of speculation about the brand bringing the pickup back. Even then the plan was for a compact truck to tackle that hole in the segment. It was even believed that the project had a green light for production seemingly with Sergio Marchionne's blessing. Then things were pushed back, and last year, the idea was officially quashed. Related Video: