Chrysler offers up to $6,000 in incentives to move cars
NEW YORK -- Chrysler said Wednesday that it is offering up to $6,000 worth of incentives on its 2009 vehicles as it races to emerge from bankruptcy protection and counter a prolonged U.S. sales slump.
The automaker filed for Chapter 11 bankruptcy last week and is working to allay consumer anxieties about buying its cars. Chrysler is trying to complete a sale to Italian automaker Fiat and hopes to emerge from bankruptcy in 30 to 60 days. All its factories have been idled.
Chrysler said the incentives, which begin Wednesday, are aimed at reducing the bottom-line price of the car. They include $4,000 cash, $1,000 for current Chrysler vehicle owners, and up to $1,000 for financing through a participating credit union.
The incentives come off the price negotiated with a dealer. They replace employee pricing plus rebates and zero% financing.
Chrysler's sales are down 46% the first four months this year. The automaker has been subsisting on $4 billion in taxpayer loans since the start of the year. It filed for bankruptcy protection Thursday after a handful of creditors refused to accept a government-brokered deal that would have reduced the automaker's secured debt.
On Wednesday, the judge overseeing Chrysler's bankruptcy proceedings ruled the automaker can start taking steps toward selling most of its assets to Fiat. The tie-up would add smaller, more fuel-efficient cars to Chrysler's lineup, give it Fiat technology and open new markets for Chrysler vehicles.
But even if the sale is approved, Fiat vehicles would not go on sale in the U.S. for another 18 months. Until then, the automaker will have to survive on revenue from its existing lineup, which remains heavily skewed toward trucks and sport-utility vehicles.
The new incentives are Chrysler's latest push to keep customers coming into its showrooms. Over the weekend, the company launched an advertising campaign, which included full-page ads in newspapers across the country that proclaimed it is "building a new car company."
