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| Obama Halves Chrysler's Planned Marketing Budget |
| 2009-05-13 |
| Chrysler wanted to spend $134 million in advertising over the nine weeks it's expected to be in bankruptcy -- the U.S. Treasury's auto-industry task force gave it half that. So if GM, which is wrestling with the possibility of a Chapter 11 filing itself, is wondering how much influence the task force will have over marketing, the answer is: plenty. However, transcripts from the U.S. Bankruptcy Court for Southern District of New York, where the Chrysler case is being heard, proved for the first time that the task force at least understands that advertising is a necessary expense -- even if it doesn't think Chrysler needs $134 million for nine weeks of car ads. Robert Manzo, executive director of Capstone Advisory Group and a consultant to Chrysler, testified at a May 4 hearing that the task force "believed that it was not feasible to not spend anything on marketing and advertising for fear of eroding the image of the brand," during the company's planned nine weeks in bankruptcy. However, Mr. Manzo also testified that this "hotly discussed" matter resulted in the task force basically slashing in half the amount Chrysler wanted for advertising in the period. U.S. Bankruptcy Court Judge Arthur Gonzalez then asked the witness: "Idle plants, why market?" referring to Chrysler's shutdown of its factories for nine weeks. "The belief on all sides was that it was essential for Chrysler not to lose its brand image in the marketplace," Mr. Manzo testified. "Advertising and marketing dollars are critical to make sure the right message is out there about Chrysler, what's happening to Chrysler during this interim period and why Chrysler will be a brand going forward that is one that a consumer should continue to look at as one of their purchase opportunities." Indeed, that's what the automaker is attempting with a national TV campaign from BBDO, Detroit, that's running in prime time on ABC, NBC and Fox to try to calm consumers' fears about the future of its Dodge, Jeep and Chrysler vehicles. The first of two 30-second spots is dubbed "Bright Future," and it refers to Chrysler's reorganization and alliance with Fiat that will build a "meaner and leaner" company for the future. The push is a departure for Chrysler, which earlier this year cut network broadcast out of its budget in favor of more inexpensively priced local TV. |
| Posted by:Fred |
| #5 SO, Chrysler's new CEO is OBama? |
| Posted by: Redneck Jim 2009-05-13 17:37 |
| #4 Being Obama, I had figured 40 days and 40 nights. No more. I'm disappointed. |
| Posted by: Grenter, Protector of the Geats 2009-05-13 13:42 |
| #3 Detroit News: Chrysler LLC and the Obama administration, hoping for a speedy bankruptcy process for the automaker, may be feeling encouraged at the selection of the judge presiding over the case. Arthur J. Gonzalez, a U.S. bankruptcy judge for the Southern District of New York, is accustomed to complicated cases, having dealt with two of the largest and thorniest bankruptcies in U.S. corporate history: Enron Corp. and WorldCom. Attorneys who have practiced before Gonzalez say the 62-year-old marathon runner is a fair and very capable judge. "He's brilliant, he's fair, he's judicious, careful, a straight arrow," said Martin Bienenstock, the lead attorney representing Enron during its Chapter 11 bankruptcy that started in 2001. Those qualities will be useful in the case of Chrysler, which filed for bankruptcy Thursday after a few creditors balked at the U.S. Treasury's offer to pay Chrysler's lenders $2.25 billion in cash to settle the automaker's $6.9 billion debt. |
| Posted by: Pappy 2009-05-13 13:36 |
| #2 Where is Iacocca when you need him? |
| Posted by: Willy 2009-05-13 12:59 |
| #1 Chrysler LLCÂ’s bankruptcy might take as long as two years, not the two months President Barack Obama suggested as a target, an administration official said. The 60 days projected by the President at an April 30 press conference announcing the automakerÂ’s bankruptcy only applies to a sale of ChryslerÂ’s best assets to a new entity, said the official, who canÂ’t be identified because the matter is confidential. Afterward, creditors would fight over unwanted factories and other assets to recover money, lawyers said. |
| Posted by: Anguper Hupomosing9418 2009-05-13 01:17 |