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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.

The Dodge Demon isn't the only way to a 10-second quarter mile

The Demon's rear tires smoke, the front tires lift – and in under ten seconds (after having spent $85,000) you've covered a quarter mile. In short, we fully get the attention shown Dodge's SRT Demonstrator. With disruption the operative word of the times, it's good to see a representative of the movement coming from Detroit. The SRT Demon delivers disruption in spades. There is, however, a viable alternative – and it doesn't require getting on the list at your Dodge dealer. If you want to do 0-60 in under three seconds or the quarter mile in around 10, the folks at Honda, Kawasaki, Suzuki and Yamaha – with any of their one-liter superbikes – have you covered. The gestation of what we now know as the superbike came roughly a decade after the debut of the muscle car. It was in the early '70s, as emission and safety regulations – along with rising insurance premiums – decimated the ranks of Detroit's fastest that motorcycle makers found their magical, almost mystical momentum. Honda's CB750 four was arguably the first, followed soon by Kawasaki's Mach III and Z-1. After that, it was Katie-bar-the-door, with more horsepower offered by Japanese OEMs until, invariably, insurance premiums went higher and, during the last recession, 20-somethings couldn't get affordable loans or insurance. Today, Japan's Big Four are once again engaged in a horsepower war, fueled by the rising interest in MotoGP, along with the rising profits available when selling a $20,000 motorcycle. And if that $20,000 - $10K per wheel – seems high, simple math tells you it's less than half of what you'll spend per corner if buying Dodge's Demon. The specs tell the tale. The Demon, fattened by both its flared fenders and a platform dating from the George Bush administration, supports its 4,200+ pounds on a wheelbase of 116 inches. That's in contrast to Suzuki's GSX-R1000 – redesigned for 2017 – which puts its 443 pounds atop a wheelbase of just 56 inches. To maximize its Hemi-supplied 800+ horsepower, Dodge diverts the air conditioning from the Demon's interior to the engine, which makes racing on a summer evening (you guessed it) devilishly hot. On Suzuki's GSX-R1000 – or similarly-equipped superbikes – almost all of the air at 100+ miles per hour is directed at you. To further underscore the differences, know that the GSX-R1000 and its like-minded competition can turn a quick corner, while the Demon is hard-pressed to execute a U-turn at the end of a quarter-mile straightaway.

NHTSA investigating Ram 1500 models for rear differential failure

The National Highway Traffic Safety Administration is investigating Fiat Chrysler Automobiles and its Ram brand following a number of reports regarding the 2005 Dodge Ram 1500 pickup. According to 15 consumer complaints, the trucks' rear differential locked up while in other cases, the driveshaft separated at its connection to the diff.
Nearly half of the reports claim the truck was traveling at or above 50 miles per hour, while two consumers reported that the diff lockup/driveshaft separation sent their pickups into a spin. Most troubling, though, is that consumers reported little to no sound indicating there was a problem with their truck.
We reached out to Ram for additional information, such as how many vehicles may be affected or what equipment might be fitted that could cause the issue. Unfortunately, the company wasn't willing to elaborate on specifics.