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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 fascinating history of the Popemobile

Pope Francis will be arriving today in the US for a variety of stops, including the World Meeting of Families in Philadelphia, PA. While here, the Pontiff won't be riding in the usual Mercedes-Benz Popemobile, but instead will make a more American switch to a modified Jeep Wrangler, according to the Washington Post. It'll feature a protected front, top, and rear, but the sides will be open for His Holiness to see the throngs of people gathering for him. For hundreds of years, Popes were transported in horse-drawn carriages or sometimes carried in an enclosed chair by footmen, but His Holiness finally traded for some real horsepower in 1929. While his ride sometimes varied depending on the country being visited, a Mercedes-Benz was generally the common choice. However, the Pontiffs have ridden in everything from a modified GMC Sierra to a Ferrari Mondial over the past few decades. Pope Francis has definitely preferred more plebeian transportation, though, including a Renault 4 running on biofuel. A trip to South Korea even put him in a Kia Soul, and he opted for an Isuzu D-Max in the Philippines. The Post's whole list is quite a fun read, and it's fascinating to see how the Popemobiles evolve over time. Related Video:

2017 Jeep Compass debuts with tiny Grand Cherokee looks

Meet the Jeep Compass. It is, thankfully, completely new and entirely unrelated to the Jeep Compass and Patriot that are on sale now. Bet you almost forgot about that pair. As the new C-Segment SUV in Jeep's lineup, it'll replace both of those models and take a spot in between the Renegade and Cherokee. The new Compass is based on a stretched version of the Renegade platform, what Fiat Chrysler Automotive in a fit of eloquence calls the "Small Wide 4x4" architecture. We expect front-wheel drive as standard and four-wheel drive as a very commonly selected option. The Compass should offer either a 2.0-liter turbo inline-four or a naturally-aspirated 2.4-liter inline-four, both mated to a nine-speed automatic transmission. There's a chance it'll get a manual, but it's a very slim chance. That being said, globally there will be 17 powertrain options, according to FCA, and that may mean US consumers will have more than one choice in the matter. Judging by the first photo above, a an off-road-ready Trailhawk model is a good bet. We've already seen this thing completely uncovered in these spy shots, which were taken in Brazil, where it will be produced, so the overall mini-Grand Cherokee aesthetic isn't a surprise. The interior looks more like the Cherokee's than the Renegade's, however, and you'll notice there's no controversial T-handle shifter in sight. So why didn't we see the new Compass at the New York Auto Show, like everybody expected? Jeep says it's because it wanted the reveal to occur at the plant that's going to build the thing, highlighting the importance of the South and Central American markets for the brand. There will be a North American debut with more information coming at the LA Auto Show in November, so we won't have too long to wait for more details. As originally planned, the Compass should hit American dealerships in early 2017. Featured Gallery 2017 Jeep Compass Revealed in Brazil Jeep Crossover SUV Off-Road Vehicles jeep compass jeep patriot