Chrysler

• 1. The Maxwell Rescue

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  Walter Chrysler arrived at the ailing Maxwell-Chalmers company in the early 1920s. He had been hired to overhaul the troubled operations after a similar rescue job at the Willys-Overland car company. Production of the Chalmers automobile ended in late 1923. In January 1924, Walter Chrysler launched the well-received Chrysler automobile. The Chrysler Six was designed to provide customers with an advanced, well-engineered car at an affordable price. Elements of this car are traceable to a prototype which had been under development at Willys during Chrysler's tenure. The original 1924 Chrysler included a carburetor air filter, high compression engine, full pressure lubrication, and an oil filter. These features were absent from most autos at the time. Among the innovations in its early years were the first practical mass-produced four-wheel hydraulic brakes. This system was nearly completely engineered by Chrysler with patents assigned to Lockheed. Rubber engine mounts called Floating Power reduced vibration. Chrysler also developed a wheel with a ridged rim. This design kept a deflated tire from flying off the wheel. This wheel was eventually adopted by the auto industry worldwide.

• 2. European Expansion And Exit

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  Chrysler expanded into Europe by taking control of French, British, and Spanish auto companies in the 1960s. From 1963 through 1969, Chrysler increased its existing stakes to take complete control of the French Simca, British Rootes, and Spanish Barreiros companies. They merged them into Chrysler Europe in 1967. The company struggled to adapt to changing markets and safety regulations in the 1970s. In 1978, Lee Iacocca offloaded the ailing European operation to PSA Peugeot Citroën for a nominal $1. This move took with it the group's substantial losses and debts which had been dragging the rest of the business down. Chrysler Europe sold vehicles like the Talbot Horizon and Sunbeam Rapier during this period. The division faced intense competition from established European manufacturers. Consumer tastes shifted toward smaller cars after the 1973 oil crisis. Chrysler could not meet the demand despite having compact models on the A body platform that proved reliable. Additional burdens came from increased US import competition and tougher government regulation of car safety and fuel economy. As the smallest of the Big 3 US automakers, Chrysler lacked the financial resources to meet all these challenges.

• 3. The Loan Guarantee Act

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  On the verge of bankruptcy in the late 1970s, Chrysler was saved by $1.5 billion in loan guarantees from the U.S. government. Congress later passed the Loan Guarantee Act providing this funding. The act required that Chrysler also obtain $2 billion in concessions or aid from sources outside the federal government. These included interest rate reductions for $650 million of the savings. Asset sales brought in $300 million while local and state tax concessions added another $250 million. Wage reductions totaled about $590 million along with a $50 million stock offering. $180 million was to come from concessions from dealers and suppliers. In 1978, Lee Iacocca was brought in to turn the company around. He sought US government help in 1979. After a period of plant closures and salary cuts agreed to by both management and the auto unions, the Plymouth Reliant and Dodge Aries compact were introduced in 1981 on the all-new Chrysler K platform. This platform was developed from the Plymouth Horizon and Dodge Omni hatchbacks which were introduced in 1978. Chrysler returned to profitability in 1980 and repaid the loans with interest in 1983.

• 4. Mergers And Restructuring

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  In 1998, Chrysler merged with German automaker Daimler-Benz to form DaimlerChrysler AG. The merger proved contentious with investors. To the surprise of many stockholders, Daimler acquired Chrysler in a stock swap before Chrysler CEO Bob Eaton retired. Under DaimlerChrysler, the company was named DaimlerChrysler Motors Company LLC. Its U.S. operations generally called DCX. The Eagle brand was retired soon after Chrysler's merger with Daimler-Benz in 1998. Jeep became a stand-alone division while efforts were made to merge the Chrysler and Jeep brands as one sales unit. In 2001, the Plymouth brand was also discontinued. On the 14th of May 2007, DaimlerChrysler announced the sale of 80.1% of Chrysler Group to American private equity firm Cerberus Capital Management. Thereafter it was known as Chrysler LLC although Daimler continued to hold a 19.9% stake. In January 2014, Fiat bought the remaining shares of Chrysler owned by the VEBA worth $3.65 billion. Several days later, the intended reorganization of Fiat and Chrysler under a new holding company was announced.

• 5. Bankruptcy And Bailout

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  On the 30th of April 2009, the automaker filed for Chapter 11 bankruptcy protection to be able to operate as a going concern. It renegotiated its debt structure and other obligations which resulted in the corporation defaulting on over $4 billion in secured debts. The U.S. government described the company's action as a prepackaged surgical bankruptcy. On the 10th of June 2009, substantially all of Chrysler's assets were sold to New Chrysler organized as Chrysler Group LLC. The federal government provided support for the deal with US$8 billion in financing at nearly 21%. Under CEO Sergio Marchionne, World Class Manufacturing or WCM was introduced. This system emphasized thorough manufacturing quality. Several products were re-launched with quality and luxury features. The Ram, Jeep, Dodge, SRT, and Chrysler divisions were separated to focus on their own identity and brand. Eleven major model refreshes occurred in 21 months. The PT Cruiser, Nitro, Liberty and Caliber models created during DCX were discontinued. On the 24th of May 2011, Chrysler repaid its $7.6 billion loans to the United States and Canadian governments. The US Treasury through the Troubled Asset Relief Program invested $12.5 billion in Chrysler and recovered $11.2 billion when the company shares were sold in May 2011.

• 6. Engineering Milestones

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  The dedicated tank building division of Chrysler was founded as the Chrysler Tank division in 1940. Its first plant was the Detroit Arsenal Tank Plant. When the M2A1 was unexpectedly declared obsolete in August of the same year plans were altered to produce the M3 Grant instead primarily for the British. After December 1941 and the United States' entry into the war against the Axis powers the Tank division rapidly expanded. New facilities such as the Tank Arsenal Proving Ground at then Utica Michigan opened quickly. It also widened the range of products it was developing and producing including the M4 Sherman tank and the Chrysler A57 multibank tank engine. During World War II essentially all of Chrysler's facilities were devoted to building military vehicles. They were also designing V12 and V16 hemi-engines producing power for airplanes but they did not make it into production as jets were developed. In April 1950 the U.S. Army established the Ordnance Guided Missile Center at Redstone Arsenal adjacent to Huntsville Alabama. Chrysler established the Missile Division to serve as the Redstone prime contractor setting up an engineering operation in

• 7. Tanks And Missiles

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  Huntsville. The Redstone was in active service from 1958 until 1964.