Chrysler LLC today reported total January 2009 U.S. sales of 62,157 units, down 55 percent versus the same month in 2008 (137,392 units), and down 31 percent from December 2008 (89,813 units). Total sales were suppressed by a significant reduction in fleet sales, which is aligned with the Company's sales strategy helping to maintain or improve the overall residual value of Chrysler vehicles for our customers. Fleet sales were down 81 percent for January compared to the same time last year. “Chrysler LLC received the first $4 billion installment of our $7 billion bridge loan from the U.S. Treasury in early January,” said Jim Press, President and Vice Chairman – Chrysler LLC. “However, it wasn’t until later in the month that Chrysler Financial received its $1.5 billion loan, greatly enhancing its ability to support our dealers and provide credit to our customers. We were very encouraged and working closely with Chrysler Financial, were immediately able to introduce our zero percent financing for customers.”
Press emphasized the financial crisis still looms and must be modified to allow dealers to stock more vehicles and to provide customers with the financing to purchase those vehicles. “While the government has made funds available to stimulate the market, these funds carry limitations, including stringent lending guidelines and conduit restrictions. At the same time, many financial lenders are also operating with tighter standards and significantly increased reserves to hold their credit rating. All these factors have limited the amount of funds that the financial institutions can make available to consumers for the purchase of Chrysler vehicles, making it more difficult for us to close sales,” he said.
January Sales Highlights
- Jeep® Wrangler sales increased 4 percent (6,362 units) compared to January 2008 (6,137 units).
- Dodge Journey sales continued to climb as sales reached 3,092 units.
- Dodge Challenger sales reached 2,757 units, up 6 percent over December 2008.
- Dodge Avenger sales increased 6 percent (2,171 units) versus December 2008.
- The Company finished the month with 359,980 units of inventory, or a 151-day supply. Inventory is down 13 percent compared with January 2008, when it totaled 413,874 units.
“Consumer credit, versus consumer demand, influenced our January retail results. We saw a negative trend in December, we’re seeing it again this month and we could see it for the year. Many more consumers wanted to buy a vehicle than could qualify for financing under the current credit conditions,” said Steven Landry, Executive Vice President, Sales, Marketing, MOPAR Parts and Service. “But, even though the economic environment remains extraordinarily difficult, near the end of the month we began to gain some sales traction with zero percent financing available through Chrysler Financial, and the addition of our new Chrysler Employee Pricing Plus Plus incentive.”
Chrysler estimated in its submission to Congress last year that the industry would sell 11.1 million units during calendar year 2009. However, the Company currently believes that if the January trend for the SAAR continues, the industry could see 10 million units or fewer sold during the year, due to the reduction of consumer credit and tightening of the lending standards.
- Dealer retail was down 35 percent, compared to industry retail, which was down 30 percent.
- Fleet sales dropped 81 percent from last January, as outlined in the Company's viability plan.
- Inventory reduction and day supply was very helpful to our dealers in reducing floorplan costs.
February Incentives
Chrysler LLC will continue the Employee Pricing Plus Plus program through February, which offers the employee price to all customers purchasing or leasing a new 2008 or 2009 Chrysler, Jeep® or Dodge vehicle. In addition to the employee price, customers are eligible for cash discounts of up to $3,500 for 2009 model year vehicles and up to $6,000 on 2008 model year vehicles. Chrysler Financial is also offering zero percent financing to qualified customers for up to 48 months. Other finance terms and rates are also available.
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