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Old 10-17-2008, 10:52 AM   #1
CL Pgh
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Default Cerberus (Friend or Foe?)

Cerberus appears to be in the mists of creating a very strong & profitable finance portfolio/company.

Look at the restrictive customer buying policies that have been in place since early this year. (Reducing collections)
Aggressive lease pull ahead programs will continue to deplete lessees and better yet, residual risk with in this portfolio.
Aged inventory with in the wholesale portfolio could actually bare some equity with new required buy downs.
Financially strong dealers only within its wholesale accounts. (rest are being weeded out)
Wholesale will have grown tolerate to LIBOR rates. (Potential international buyers want this)
Current APR’s both customers & dealers are paying are absolutely above the norm. (Profit's)

By the time next fall rolls around and the conduit comes up for renewal… Cerberus will cash in and dump this attractive portfolio/company or re-up the conduit at substantially lower rates and really start rake’n in the $$$’s.

Now I have no problem with making money! But… will Cerberus (a private equity firm) share the wealth/stability with us? Another half point bump yesterday in floor plan rates (after fed. cuts?) … it’s not really looking like they will.

Just my .02. What's yours?
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Old 10-18-2008, 08:45 AM   #2
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Default Cerberus only cares about Cerberus

I think the answer to your question depends on who you ask.

Cerberus is a friend if you have your money invested with them or your objectives happen to be the same as theirs.

By contrast, Cerberus is a foe if you happen to stand in the way of what they want to accomplish. I think the company is so focused on their own success that they will crush anyone that tries to oppose them. As an example, look at how they're using GMAC's new FICO restrictions to weaken GM so they have a stronger negotiating position.

From a dealership perspective, I think it's too early to tell.

The one thing I know for sure is that when Cerberus completed the Chrysler purchase from Daimler they referred to themselves as "patriots" wanting to restore a great American icon. I didn't buy that line then and I buy it even less now.

The only thing that Cerberus cares about is Cerberus.
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Old 10-20-2008, 07:14 AM   #3
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The only thing that Cerberus cares about is Cerberus.
I agree 100%
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Old 10-22-2008, 08:38 AM   #4
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Default This question keeps getting easier to answer......

Imagine that you're a GM dealer in California and you're barely able to keep your head above water and then you get this notice:

Many GM dealers in California had been told that they would have to begin paying down the principal they owe on GM vehicles over 180 days old. Those new payments will require principal payments of 5 percent to 10 percent per month, Welch said.

Ironically, the dealers that have been most loyal to GM/GMAC over the years are going to get screwed over the worst.

Is Cerberus a friend or foe? That question keeps getting easier to answer.

Here's a link to the full news report about GMAC's new flooring policies: http://www.reuters.com/article/funds...33085520081022
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Old 10-22-2008, 06:30 PM   #5
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Angry No investment in new product beyond 2010

In regards to Cerberus - Friend or Foe?, the answer just keeps getting easier.

I just read the following from a Reuters news release:

One reason for Cerberus to press for a quick deal is that the private equity firm has effectively cut off investment on Chrysler's vehicle development beyond 2010, analysts said.

That would certainly explain why the Getrag deal was killed. It would also seem to verify the rumors that the Phoenix Engine Program has been killed.

Has it even been a month since Press and Landry were telling the dealers that the pipelines are full of wonderful new vehicles - "you just need to make it through to 2010."

Here's a link to the full news report: http://www.reuters.com/article/reute...BrandChannel=0
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Old 10-25-2008, 05:51 AM   #6
CL Pgh
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No doubt Chrysler Employees have been asking the same.

Some factual sarcasm always adds a little reality to the story.
http://www.freep.com/article/20081025/COL06/810250385
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Old 10-25-2008, 12:01 PM   #7
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Originally Posted by CL Pgh View Post
No doubt Chrysler Employees have been asking the same.

Some factual sarcasm always adds a little reality to the story.
http://www.freep.com/article/20081025/COL06/810250385
That was a great story - I love a good dose of sarcasm on occasion.

In another post I made reference to the fact that this "crisis" at Chrysler feels different than the rest. Iacocca and Lutz were strong leaders that knew the car business and cared about the success/failure of the dealers.

By contrast, Nardelli, LaSorda and Landry don't have a clue and they could care less about the dealer network.

Bob Eaton scored a huge bonus when he sold-out to Daimler - he's been hated by the Chrysler loyalists ever since.

Sadly, my bet is that the same story will be written about Nardelli in the not too distanct future.
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Old 10-25-2008, 02:29 PM   #8
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Do you know what sucks is that none of these so called leaders have any show room experience do they ?

I think if they did they would have a totally different idea of how to run the car business. The best ex of this is how many of your factory and finance reps have any idea what it like in the trenches ? The future should call for that and then things may run smoother and less dealers loosing their lively hood.
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Old 10-25-2008, 05:48 PM   #9
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Originally Posted by dafuzz1956 View Post
Do you know what sucks is that none of these so called leaders have any show room experience do they ?

I think if they did they would have a totally different idea of how to run the car business. The best ex of this is how many of your factory and finance reps have any idea what it like in the trenches ? The future should call for that and then things may run smoother and less dealers loosing their lively hood.
There's no question that the dealers and the corporation always made the most money when there was a "car guy" running the company.

When I look at Chrysler's product offerings I sometimes shake my head in disbelief. Take the Jeep Liberty, Jeep Compass and Jeep Patriot - what the Hell were they thinking? "Let build three vehicles that compete with one another and then place them on the same showroom floor."

While it's popular to blame Daimler and Cerberus for Chrysler's problems, I believe that many of today's failures are the result of decisions made by the same "leaders" that are directing the corporation today.
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Old 10-26-2008, 10:02 AM   #10
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http://www.nypost.com/seven/10182008...wel_134146.htm

Cerberus ruins another company?????
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Old 10-27-2008, 09:04 AM   #11
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http://www.nypost.com/seven/10182008...wel_134146.htm

Cerberus ruins another company?????
That's interesting. While I had read that headlines about the Mervins failure I didn't know that Cerberus was involved with the company.

The part of the news report that indicated that Cerberus increased the rent factor for the stores shortly after their investment sounded like a page from their playbook. There's no question that Cerberus is willing to play hardball when it comes to executing their strategy.
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Old 11-04-2008, 09:59 PM   #12
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Default Where's Chrysler's Public Relations Department?

I think we've established in this thread that Cerberus is not a friend to the Chrysler Dealer Network.

That said, think about all of the negative stories that have been written in the media about Chrysler over the past two weeks and ask yourself - "Where's Chrysler's P.R. Department?"

Is it possible the Cerberus is controlling Chrysler's P.R. Department to fulfill their own agenda?

As I see it, Cerberus wants to dump Chrysler but there's no money available in the private sector to fund a GM merger. In order to get Federal Assistance Chrysler needs to be seen as a weak company that's on the verge of bankruptcy.

I truly believe that the people that run Cerberus are brilliant - look at how they've used their 51% interest in GMAC to control General Motors. My bet is that they're exerting the same degree of control over Chrysler's P.R. Department to fulfill their own selfish agenda while the Dealer Body is left twisting in the wind.
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