Jeep rumors
pdx_pat
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Warranty
So if Jeep were to be sold. Who would honor the warranty? Would it be the new owner or Chrysler? Or would it depend on the terms of the sale? I think everything is in the name of Chrysler. As long as my warranty is honored by somebody I am happy. A selling point for me was the lifetime powertrain. Would hate to lose that.
So if Jeep were to be sold. Who would honor the warranty? Would it be the new owner or Chrysler? Or would it depend on the terms of the sale? I think everything is in the name of Chrysler. As long as my warranty is honored by somebody I am happy. A selling point for me was the lifetime powertrain. Would hate to lose that.
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We had this discussion about International already here:
http://www.jeeppatriot.com/forum/showthread.php?t=9102&page=3
If someone asks me i´m sick and tired of all the rumors we had in the last half year and i´m pretty sure we will have in the next half year too.
Most times it´s just BS not more.
http://www.jeeppatriot.com/forum/showthread.php?t=9102&page=3
If someone asks me i´m sick and tired of all the rumors we had in the last half year and i´m pretty sure we will have in the next half year too.
Most times it´s just BS not more.
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52 Posts
Rends... I agree! Also sick of hearing the rumors, especially since my dad works for a chrysler/jeep dealer. These news guys need to stop reporting on all the negative crap. How are people supposed to build consumer confidence when they're constantly being reminded of foreclosures, unemployment, etc.
As far as warranties... I asked this question when I bought my Jeep. The warranties would still have to be honored if the brand is sold.
As far as warranties... I asked this question when I bought my Jeep. The warranties would still have to be honored if the brand is sold.
I okay with it if you honor my warranty. I should probably make sure towing is covered under my insurance though.
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8,881 Posts
Then came the YJ......the Yuppie Jeep.
The warranty obligations are treated as a liability on the books, and as such would be transferred to the new owner of the company. They'd have to go through some kind of bankruptcy in order to offload those liabilities.
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300 Posts
As for warranties:
Copied directly from page 162 of Chrysler's restructuring plan:
Failure to grant incremental Government funding request and concessions would lead to Chapter 11 with DIP financing estimated at $24 billion.
Inability to secure $24 billion of bankruptcy DIP financing leads to liquidation over a 24 to 30 month period with the following consequences:
• 29 manufacturing facilities and 22 parts depots closed immediately.
• 40,000 direct Chrysler U.S. employees lose their jobs.
• 3,300 dealers with 140,000 employees go out of business.
• $7 billion in outstanding auto supplier invoices go unpaid.
• 31 million vehicle owners lose significant value, warranties, parts, and service.
Copied directly from page 162 of Chrysler's restructuring plan:
Failure to grant incremental Government funding request and concessions would lead to Chapter 11 with DIP financing estimated at $24 billion.
Inability to secure $24 billion of bankruptcy DIP financing leads to liquidation over a 24 to 30 month period with the following consequences:
• 29 manufacturing facilities and 22 parts depots closed immediately.
• 40,000 direct Chrysler U.S. employees lose their jobs.
• 3,300 dealers with 140,000 employees go out of business.
• $7 billion in outstanding auto supplier invoices go unpaid.
• 31 million vehicle owners lose significant value, warranties, parts, and service.
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1,211 Posts
Vehicle manufacturers being sold back and forth has become a fact of life over here in Europe. What always happens is that, in order to ensure confidence in the product, the new owner has to take on all the existing guarantees. Without doing that they'd have a real up-hill job selling the stuff that they'd bought. New customers would suffer a crisis of trust and simply go elsewhere.
Anyway, Guys, thiink what you like about asset-stripping, in this particular asset-stripping situation we all ,at least, hold a piece of the asset rather than a slice of the liability.
Rocal.
Anyway, Guys, thiink what you like about asset-stripping, in this particular asset-stripping situation we all ,at least, hold a piece of the asset rather than a slice of the liability.
Rocal.
Chapter 11 is a bankrupt with re-organization, not a total dissolution like Chapter 7.
Think about it: If you file Chapter 11 to restructure, the last thing you want to do is to void all warranties otherwise you'll lose all customers and value. Otherwise, Chapter 7 is better (dissolution). Lost trust is very hard to re-acquire, so you try to keep customers by all means.
I think it's more like a catastrophic scenario, or FUD if you like, that anything else...
Chapter 11 with Government help is the best solution for Chrysler. They failed. They have to face it. There's will be pain yes but it's for the better future. Cleanup has to be done.
They already got Government help in '79 because of oil crisis, they didn't learn from their mistakes because it's happening again. Hope this time, they will learn.
GM have to face it too.
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The info from Chrysler is talking about the consequences of failure to arrange debtor-in-posession financing under Chapter 11; so that is the Chapter 7 scenario. Warranties may or may not be honored under Chapter 11 bankruptcy, but certainly would not be honored under chapter 7.
http://wheels.blogs.nytimes.com/2009/02/20/of-car-warranties-and-chapter-11/?hp
http://www.autotropolis.com/wiki/index.php?title=Bankruptcy_and_Your_New_Car_Warranty
It seems to me that it is pretty unlikely that Chrysler would be able to spin off Jeep as a separate company in the short-intermediate term, because they have the same platforms (MK and KK) selling under both the Jeep and Dodge nameplates, and assembled in the same plants (MK at Belvidere, and KK + KA at Toledo North). Combined sales make MK's the second and KK+KA the fifth best-selling platforms in the entire Chrysler lineup for calendar year 2008.
If it was logistically possible to spin off Jeep, Navistar (formerly International Harvester) is not a very likely candidate to acquire it. IH got out of passenger vehicles in 1980 and there's no incentive to get back in at this time. Also, NAV's balance sheet is a mess, and they are already in debt up to their eyeballs, with senior unsecured debt already rated at BB- by both Fitch and S&P.
The idea, put forth in the JPMagazine (hoax) article, that any company buying the Jeep brand would discontinue the MK platform is just plain goofy.
http://wheels.blogs.nytimes.com/2009/02/20/of-car-warranties-and-chapter-11/?hp
http://www.autotropolis.com/wiki/index.php?title=Bankruptcy_and_Your_New_Car_Warranty
It seems to me that it is pretty unlikely that Chrysler would be able to spin off Jeep as a separate company in the short-intermediate term, because they have the same platforms (MK and KK) selling under both the Jeep and Dodge nameplates, and assembled in the same plants (MK at Belvidere, and KK + KA at Toledo North). Combined sales make MK's the second and KK+KA the fifth best-selling platforms in the entire Chrysler lineup for calendar year 2008.
If it was logistically possible to spin off Jeep, Navistar (formerly International Harvester) is not a very likely candidate to acquire it. IH got out of passenger vehicles in 1980 and there's no incentive to get back in at this time. Also, NAV's balance sheet is a mess, and they are already in debt up to their eyeballs, with senior unsecured debt already rated at BB- by both Fitch and S&P.
The idea, put forth in the JPMagazine (hoax) article, that any company buying the Jeep brand would discontinue the MK platform is just plain goofy.
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