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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.

Junkyard Gem: 1983 Jeep DJ-5L Mail Dispatcher

When it comes to putting mail in boxes, a simple and reliable vehicle works best. Say, a zero-frills steel box on wheels, with right-hand-drive, a fuel-efficient four-cylinder engine, no-hassle automatic transmission, sliding doors, and a big mail-sorting table instead of a passenger seat. That's what the AM General Mail Dispatcher DJ-5 was all about, and these bouncy little trucks were everywhere for decades. Here's a late-production example, still in USPS colors, spotted in a Denver-area self-service wrecking yard. Neither snow nor rain nor heat nor gloom of night stayed this courier from the swift completion of its appointed rounds. Note the "Sonic Eagle" USPS logos on the doors; this became the official USPS logo in 1993, nearly a decade after the final Jeep DJ-5s were built. Plenty of these trucks stayed in service into our current century, and a few are still being used by private mail-delivery contractors in rural areas. During the American Motors era of Jeep DJ production (1970 through 1984), a bewildering assortment of engines went into postal Jeeps. This is a 2.5-liter GM Iron Duke four-cylinder; before that, DJ-5s came with Audi power (more or less the same engine used in the Porsche 924, in fact), AMC straight-sixes, and Chevy Nova four-cylinders. The 1984 DJ-5Ms ran the AMC 2.5-liter four-cylinder. The earliest DJs were equipped with three-speed manual transmissions, but the American Motors-built postal-delivery versions all had automatic transmissions. This one has a three-speed Chrysler Torqueflite A904, a weird engine/transmission combination that should help you stump your friends during car-trivia debates. Check out the ultra-bare-bones heater/ventilation controls! These trucks were badged as AM Generals, not Jeeps (I couldn't find a single Jeep label anywhere on this one), just like the original HMMWV. However, you'd have to be a real hair-splitter to refer to this as an AM General DJ-5 instead of just Mail Jeep or Jeep DJ-5. Next time you complain about your subcompact rental car lacking driver-comfort features, consider this vehicle. I had a few high-school friends who owned DJ-5s, back in the early 1980s when they were available for a couple hundred bucks at government-surplus auctions. The first thing civilian DJ-5 owners always did was tear out the mail-sorting table and replace it with a random junkyard bucket seat (or an aluminum lawn chair). These trucks were very noisy, very bouncy, and very slow, but they always ran.

Watch these Super Bowl car commercials [UPDATE]

On Sunday, February 3, the New England Patriots take on the Los Angeles Rams in Super Bowl 53 at Mercedes-Benz Stadium in Atlanta, Georgia. Some will watch because of the storyline of the old-school dynasty facing off against the new-school wunderkinds, but a large chunk of people will solely be watching for the commercials. Lucky for those who slot into the latter category, many of the manufacturers release their super bowl ads ahead of time, or have simply opted to release the commercials only online. Scroll down to see what car companies have already shown their cards. Audi Audi goes the comedic route in its clip for the Big Game. It starts with a grandpa showing his grandson a gorgeous Audi e-tron GT tucked away in a garage before he's shaken awake. Turns out he was just choking on a cashew in his cubicle at his boring job. Dodge Dodge does what it knows: create enough smoke to punch more holes in the ozone layer. Set to "The Devil Went Down to Georgia (the Super Bowl is in Atlanta, get it!?), a Challenger SRT Hellcat widebody, Charger SRT Hellcat, and Durango SRT are seen ripping through a city, leaving a trail of rubber crumbs in their wakes. Genesis Genesis has not yet released a commercial prior to the Super Bowl, but it is the official luxury vehicle of the NFL. Because of this, Genesis is hosting a fan experience for 10 days before the game. It will showcase the brand's cars, offer games, and have photos opportunities and autograph days. Hyundai Jason Bateman alert! Hyundai is one of the few companies to hook a major celebrity for its advertisement, and the casting is perfect. Bateman plays a doorman who takes people to various terrible events in life, including root canals, the middle seat, and shopping for a car. The ad centers around Hyundai's Shopper Assurance, which is Hyundai's new method for car shopping. Jeep An old 1963 Jeep Gladiator finds its strength in the crusher and transforms into a a new 2020 Gladiator, with a firm declaration that the nameplate is officially back. Kia Through Kia's commercial, a young boy wonders out loud what it'd be like if the millions spent on Super Bowl commercials were used to help others.