Consumer Reports' Top 10 Automakers

Today, Consumer Reports released the results of its annual car reliability survey, which includes more than 1.4 million vehicles. This is one of the most important publications of the year for consumers interested in a car’s reliability. There were few surprises in terms of which makes are most and least reliable, with Scion maintaining the top spot. Porsche, Saab, Suzuki and Pontiac saw the biggest gains while Lincoln and Mini took the biggest hits. Check out Consumer Reports full report if you’re a subscriber. We list the top 10 most and least reliable automakers below.

Fiat to Gut Chrysler Lineup

Update 11/5/09: Fiat and Chrysler have officially announced lineups for the future which directly counter the claims made in the Wall Street Journal story mentioned in the below post. Click on the following links for the formal lineups.

The Future Chrysler Lineup
The Future Jeep Lineup
The Future Dodge Lineup

The Wall Street Journal reported today Fiat’s future plan for Chrysler, a full week before the company is to meet in a closed-door session with analysts and media to reveal its intentions.

The article is striking in its detail and scope of Fiat’s restructuring. Nearly the entire Chrysler, Dodge and Jeep lineups will be replaced in five years by not only Fiat technology and products but also the return of Alfa Romeo as a luxury marquee slated above Chrysler.

We break down the product shifts below.

GM, Chrysler Execs Could Face Pay Cuts

The U.S. Treasury Department under the leadership of so-called “pay czar” Kenneth Feinberg has ordered pay cuts for the top 25 executives at seven companies, including GM and Chrysler, that received substantial federal aid.

While banks and the insurance company AIG will face the steepest cuts, GM and Chrysler could see some minor pay adjustments. GM has already cut CEO Fritz Henderson’s 2009 pay by 27% from last year, to $1.26 million. CFO Ray Young got a 15% reduction to $720,000.

GM, Chrysler and their financing arms GMAC and Chrysler Financial knew this was coming; it was included as a condition of the government loans that saved the automakers.

AIG will face the Treasury Department’s greatest wrath, which is probably fair since it nearly caused a meltdown of the global economy through its credit default swaps. AIG received more than $180 billion from taxpayers, which was three times more than GM’s aid and over 20 times more than Chrysler’s; the insurance company’s executives could face average pay cuts of 50%.

Fiat executives are the only ones who will escape the cuts because it was a part of the deal that brought the Italian automaker on as Chrysler’s 20% stakeholder.

Auto Execs Could See Pay Cuts Under Obama Order (Detroit Free Press)

Chrysler Improves Market Share South of the Border

Did you hear the news? Chrysler is rebounding… in Mexico!

While the embattled automaker continues to struggle in the U.S. following its bankruptcy, its market share in Mexico hit an 18-month high this September. Sales for the month were 7,068 — nearly 1,000 less than a year ago — but the automakers sales have increased steadily since the market bottomed in June, according to Chrysler.

The automaker nabbed 11.8% of the Mexican market, beating Ford for the first time in 15 months. This is down from Chrysler’s historical average of 15.1% of that market, but it does beat the year-to-date market share of 10.6%

Over the last year, Chrysler’s market share has dropped in the U.S. from 9.5% to 8.3%. This is also much lower than its historical average over the past 25 years of 13.4%, according to Autodata.

This minor surge was led by the success of the Dodge Journey, which sold more than double the second-place Honda CR-V in the crossover segment. The Dodge Ram’s share in the pickup truck market also increased from 23.8% in 2008 to 32% this year.

The volatility of the gas crisis and the recession did not swing the market in Mexico as much as it did in the U.S., where Chrysler’s sales are down 39.5% for the first nine months of the year.

Chrysler’s Mexican Market Share Hits 18-month High (Detroit News)

Dodge Adds New Ram Truck Brand

Long rumored to be a possibility, Dodge pickup trucks will be separated from Dodge cars under their own Ram brand. Sergio Marchionne, managing director of Fiat and Chrysler CEO, confirmed the shake-up.

Just how the lineup will be split has yet to be explained, but it’s likely pickups, SUVs and vans will get a Dodge Ram badge. Cars and most crossovers will remain Dodge cars.

“The brand-focused strategy has been refined further with the unbundling of the Dodge brand, which now consists of the Dodge Ram brand and the Dodge car brand organizations,” Marchionne said. “This reorganization will allow us to protect and develop the unique nature of the product offerings within the Dodge brand.”

The Ram got a significant redesign last year, but sales have stagnated compared to the new F-150 from Ford. The smaller Dodge Dakota sold 399 units last month. Even though the Dodge Durango SUV is expected to return as a 2011 model, we just don’t see a reason for a separate Ram brand. Especially since Chrysler successfully merged all of their brands into single stores featuring Chrysler, Dodge and Jeep.

Dodge Trucks to Be Separated From Cars Under Ram Brand (PickupTrucks.com)

Speculation Abounds Around Fiat-Run Chrysler

As we near the anticipated early November announcement about the future of Chrysler, news agencies are already speculating about its plans. Today, Reuters reported that Fiat will spin off Ram into its own brand and new, jointly designed Chrysler models won’t arrive until late 2011.

Publications such as Car & Driver magazine have suggested the new models will include a midsize sedan based on a Fiat and branded as the Dodge Avenger and Chrysler 200, which was shown as a concept car at last year’s Detroit auto show.

The redesigned Chrysler 300 and Jeep Grand Cherokee have already been announced and will go on sale at some point in 2010, as will the Fiat 500.

As to the Ram brand rumor, Reuters says its to serve as an umbrella for all of the Dodge trucks. However, with weakening demand for small trucks like the Dakota and sales of the Ram falling behind its Detroit rivals, we’re not sure there is any reason to change the way Dodge sells trucks.

Fiat to create Ram brand, rush new Chrysler models (Reuters)

Tight Supply and Demand Means More Expensive Cars

Detroit’s automakers are working to bring vehicle supply and demand into harmony by reining in their reliance on incentives and discounts to sell cars. This has raised vehicle prices during the recession, a move that seems counterintuitive. The Big Three’s vehicles sold for an average of $2,000 more in the second quarter of this year than in the first quarter, according to J.D. Power and Associates.

Ford and GM are leading the drive to cut incentives after learning the hard way that a bloated inventory and huge rebates aren’t the best way to make a profit. Rebates can help improve market share, but they cost automakers money. The Cash for Clunkers program teamed with a summer production shutdown created low inventory levels that haven’t been seen in years.

This is a lesson that the Big Three’s competitors have already perfected. Toyota offered an average discount of $1,584 per vehicle this year, while Honda offered $1,567, according to Autodata. Meanwhile, Ford offered $2,811 discount per vehicle; GM, $3,418; and Chrysler, $4,407.

Detroit’s automakers are attempting to match vehicle supply to demand more closely and decrease their reliance on incentives. This has cost consumers $900 million in net pricing in North America during the second quarter. The average price of a Detroit automaker’s car rose 7.8% from $25,567 a year earlier to $27,571 in the second quarter of this year, according to J.D. Power.

Unfortunately, what is healthy for automakers will cost consumers.

Buying a Car Gets Pricier as GM, Ford Cut Inventory (Bloomberg News)

Chrysler Taking Owner's Manuals Digital for 2010 Models

Chrysler thinks one way to win over car shoppers in the digital age is to take the venerable owner’s manual and make it digital for its 2010 Chrysler, Dodge and Jeep models. That means instead of a ridiculously large book taking up space in your glove box, you’ll get a DVD and a 60-80-page full-color user’s guide. Chrysler says this move will save 930 tons of paper.

We’re just hoping the user’s guide will have that one bit of information you need when you’re stranded and nowhere near a DVD drive — or even if you’re just in your driveway. Chrysler lists the following as included in the guide:

Chrysler Returns to Leasing for 2010 Models

After a hiatus that covered the 2009 model year, Chrysler will return to leasing for all 2010 Chrysler, Dodge and Jeep vehicles. New 2009 vehicles still on dealer lots will get 0% financing for 72 months.

GMAC Financial is offering both the leasing and financing deals for Chrysler. The company discontinued the leasing program last summer when sky-high gas prices forced a shift in the car market and permanently injured the company, which eventually had to file for bankruptcy.

Chrysler’s lease deals go into effect Thursday.  

Cars.com Podcast: Corvette ZR-1, Chrysler 300C SRT8

Editors Joe Wiesenfelder and David Thomas discuss two high-output performance cars that spent some summer hours in the Cars.com fleet. The two discuss how you can only enjoy these cars during certain times of the year in some parts of the country. They also remind listeners with a performance car to check the standard tires to see how they’ll handle bad weather.

You can download the podcast via iTunes here or via a web browser here.