– It takes two things to attract buyers into your showroom, product and quality, says Rich Schaum, executive vice president of product development and quality for Chrysler Group. “Using 1996 as the benchmark, we’ve improved quality as measured by warranty costs by 50 percent and hope to realize another 20 percent gain in ’03,” he says.
– Why does the industry continue to do well, with sales at or about 17 million for the last three years? “Ten years ago it took 30 weeks of income to buy a new vehicle and today it takes 19.9 weeks of income and that’s why people still feel the desire to drive a new vehicle,” says Steve Lyons, president of Ford division.
– “People say if you had less incentives you’d make more money, but people don’t buy without incentives,” said General Motors President and Chief Executive Rick Wagoner. On the positive side, “incentives keep our plants going and generated $6.3 billion in positive cash flow last year,” he says.
– When Toyota dealers complain it is hard to compete with the incessant drumbeat of $3,000 rebates and zero-percent financing from domestic brands, general manager Don Esmond says Toyota doesn’t need to match Detroit’s spending habits. “We tell them to look at their own sales success,” Esmond says. Toyota division sales were up slightly last year, and domestic brands dropped 4.5 percent. “We did pretty well without major incentives.”
– The media has been quick to criticize because Chrysler Group parent DaimlerChrysler in Germany has opted not to report the individual compensation of its U.S. executives. Rather, being a German-based company, it will follow the German policy of reporting compensation given executives as a group. And how does Chrysler Group President and CEO Dieter Zetsche react to the controversy? After a lengthy response to the question, he paused and said: “We’ll do what’s legal.”
