Car sales rebound during Cash For Clunkers

The federal "cash for clunkers" program lifted U.S. auto sales in August to the first monthly, year-over-year gain since October 2007, raising hopes the market is beginning to rebound.Analysts and auto executives expect demand to fall in September, in part because some buyers pulled ahead purchases to take advantage of as much as $4,500 in government rebates. But recent signs that the economy may be improving could prevent sales from dropping to new lows.

Still, the outlook is uncertain. "People are feeling the uptick, but how long will it really last, no one can say for sure," said Laurie Harbour-Felax, president of Harbour Results Inc.
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Chrysler, Fiat May Replace Engineering on Snoop’s Car

Chrysler Group LLC may retire the engineering used to make its iconic 300C sedan in favor of more modern architecture jointly developed with Fiat SpA, said two people familiar with the situation.

The so-called “LX” platform, which was used to produce more than 210,000 cars last year, would be replaced by a new structure that could also underpin a full-sized sedan for Fiat’s Alfa Romeo brand, said the people, who declined to be identified because a final decision hasn’t been made.

The project would be the first joint product by Chrysler and Fiat and would be the basis for the U.S. carmaker’s highest- volume vehicles as well as Alfa Romeo’s largest sedan. Sergio Marchionne, chief executive officer of both automakers, has said a company needs to build at least one million vehicles on a single platform to be profitable.

“It would be a major change to the platform, rather than an all-new platform.” said Stephanie Brinley, an analyst at AutoPacific in Troy, Michigan. Chrysler would likely start using the platform on all its new cars and Turin, Italy-based Fiat on its Alfa Romeos in 2012, while production of the Chrysler 300, Dodge Charger and Challenger would probably be switched over in 2014 or 2015, Brinley said.

“We’re in the process of defining the brands, defining the product portfolio,” said Rick Deneau, a Chrysler spokesman, declining to comment on the platform. A Fiat spokesman declined to comment.

The 300C is Chrysler’s flagship passenger sedan. Los Angeles rapper Snoop Dogg in 2004 left a voice mail for then- Chrysler CEO Dieter Zetsche asking how he could get the car. The singer later made a television commercial playing golf with former Chrysler Chairman Lee Iacocca that featured the jingle, “If the ride is more fly, then you must buy.” Chrysler sold 62,352 of the cars in the U.S. last year and is introducing a revamped model in 2010.

Building a new platform can cost $1 billion or more, making it more cost-effective to assemble as many vehicles as possible off a single design because it lowers engineering and purchasing costs. The new platform, which would be with rear-wheel-drive, could be lighter and be made more flexible to accommodate difference sizes of vehicles, said John Buckland, an auto analyst with MF Global Securities in London.

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