How does the Motor City spell desperation? "P-A-N-T-I-E-S!"
Or, more formally, "Lingerie Bowl 2004," a Super Bowl panty-party extravaganza, courtesy of the Chrysler Group's Dodge brand. It's a seven-on-seven football game featuring lingerie models, to be shown on pay-per-view during Super Bowl halftime.
Some vital statistics: The quarterback for "Team Dream" will be Nikki Ziering, a former model on The Price Is Right who has appeared in Playboy. Her counterpart on "Team Euphoria" will be Angie Everhart, a model and actress who is also a Playboy alumna. Lawrence Taylor, the former linebacker whom Mike Wallace recently made cry on 60 Minutes, will serve as a coach, and Michael Buffer, the "Let's get ready to rumble" guy, will serve as master of ceremonies.
PHOTO: THE NEW YORK TIMES
As they say, desperate times require desperate measures. And the last few years have certainly been brutal for the Big Three automakers -- particularly for the Ford Motor Co and the Chrysler Group, a division of the German company DaimlerChrysler that includes the Chrysler, Dodge and Jeep brands. Most analysts see GM as the strongest of the group, with the most solid products and management team.
Ford and Chrysler are each a few years into turnaround plans aimed at dragging their businesses out of the red and getting investors and consumers excited again. Beset by high incentive spending, shrinking market share and meager automotive profits, the two behemoths have been forced to impose drastic and demoralizing cost-cutting measures. Wall Street analysts have been pouring on doubt. And some competitors, especially Toyota, are in far better shape in terms of their products, financial health and manufacturing efficiencies.
Stock prices of both companies have taken a pounding in recent years, with Ford's down 60 percent and DaimlerChrysler's down 57 percent since the beginning of 1999. Analysts see DaimlerChrysler's drop as largely reflecting the sluggish performance of the Chrysler division.
Worse for DaimlerChrysler is the spectacle, five years after the "merger of equals" that joined DaimlerBenz and Chrysler, of current and former executives being forced to testify about the deal this month in a court in Wilmington, Delaware. The company has been sued by Kirk Kerkorian, the 86-year-old billionaire casino mogul who was Chrysler's largest shareholder. He charges that the deal was fraudulently presented as a merger, allowing the carmaker to forgo the typical premium paid in acquisitions.
The proceedings have led to a re-examination of the deal itself -- and have not lacked for rancor. "I will never enter settlement talks with DaimlerChrysler," Kerkorian said on the courthouse steps Wednesday, according to AP.
He added: "This is not about money. This is about deceit and fraud."
Despite their distractions, William Clay Ford Jr, the chairman and chief executive of Ford, and Dieter Zetsche, the chief executive of Chrysler, have said in recent weeks they are ready to go on the offensive once more and ride the coattails of new products coming in the new year.
They say profits are just around the corner, the economy is improving, and so is the quality of their products.
And both Ford and Daimler shares have recovered some of their value in the last eight months and hit 52-week highs last week.
Turning around a struggling corporation generally requires the modern chief executive to play the salesman, even when there's not much to sell. And Detroit is a virtual turnaround clinic because one of the Big Three always seems to be ailing.
Lee Iacocca, the former Chrys-ler chairman, personified the kind of zestful boosterism it took to keep a struggling automaker alive. William Ford's uncle, Henry Ford II, took over a Ford Motor that was in dire shape after World War II.
Detroit rescue operations are slow to develop because auto production cycles cannot be turned on a dime.
Also, it takes years of improving quality for customers to forget years of lagging quality, and the stellar reputation of Toyota and Honda in this area means their cars have significantly higher resale values.
Lately the bar of success has been raised by Carlos Ghosn, who seems to have waved a magic wand over Nissan. Ghosn, who became Nissan's chief executive in 1999, took over a company mired in debt, losses and aging products.
Making his job more complicated was the fact that he was a Brazilian-born Frenchman of Lebanese descent taking over an insular Japanese icon.
But in four years, he eliminated the debt and revived the company's product lines and profit margins, and Nissan has become one of the industry's most dynamic companies.
He has been embraced in Japan to the point that there is a comic book series depicting him as a virtual superhero.
Ghosn succeeded in balancing the two sometimes competing tenets of automotive turnarounds: whittling away at costs while beefing up products.
"Carlos Ghosn walked into Nissan in 1999 and managed to get the company's operating margins up to 11 percent," said Maryann Keller, a veteran auto analyst and a former executive at Priceline.com. "The execution should be easy if you take Nissan as a model."
That may be a slight overstatement.
Domenic Martilotti, an analyst at Bear, Stearns, said that what Ghosn had accomplished was "remarkable, but he's done the restructuring in Japan," where he could close plants without union opposition, among other things.
Certainly, for William Ford and Zetsche, there is much at stake.
For William Ford, the turnaround is an intensely personal campaign to revive his great-grandfather's struggling company. Two years into his turnaround plan, he has taken a muted approach and says he wants to let the products, and his performance, speak for themselves.
"That's the best way I know to be a salesman," he said in a recent interview. "To hit the numbers and deliver. I'll let others do the PR thing. I will be a salesman with our employees and, to the extent people think I can be effective, with the ratings agencies and Wall Street."
For Zetsche, his future as a possible successor to Jurgen Schrempp, chairman of DaimlerChrysler -- whose position is more comparable to that of Ford-is seen as riding on his success, or failure, at the Chrysler Group.
While overseeing his turnaround plan over the past three years, he has been highly visible, and he barnstormed the country last month to meet and greet more than 5,000 dealers and their employees.
"During the last five years, we have quietly been working on a complete transition of the Chrys-ler Group as a world-class competitor," said Zetsche said at a media briefing last month, adding, "We have the right plan and the right team, and now we have the right product."
Wall Street has yet to be convinced.
Last month, Standard & Poor's downgraded Ford Motor's credit rating to BBB-, the lowest of 10 notches above a junk rating; the month before, it had downgraded DaimlerChrysler to BBB, the second-lowest investment-grade rating, citing Chrysler's lagging performance.
"Strong demand has not made for strong financial performance by these three automakers," wrote Scott Sprinzen, an analyst at Standard & Poor's, in a report last month. "Robust industry demand has been partly a result of steep price discounts. Also, Ford and Chrysler have experienced material market-share erosion, meaning they have not gotten the full benefit of higher industry volume."
Ford Motor and the Chrysler Group are not directly comparable because Chrysler is now a division of a large corporation, while Ford is a large corporation. Ford's brands include Ford, Lincoln and Mercury, as well as a suite of international luxury brands known as the Premier Automotive Group that includes Volvo, Jaguar, Aston Martin and Land Rover.
Nonetheless, Chrysler and Ford face a similar challenge, if on different scales, analysts say. Simply put, they are automakers that have not been making much, if any, money from selling automobiles. Both are heavily dependent on America's swelling appetite for sport utility vehicles and big pickup trucks. Critics have said both automakers have lagged in product development in recent years, particularly in their car lines.
New products, including cars, are beginning to appear. But for Ford, nothing is more important than its recently redesigned F-Series pickup, which is the best-selling vehicle of any kind in the nation. Next fall, though, Ford will begin selling the first cars aimed at reviving a line that is now focused largely around the aging Taurus, including the Five Hundred sedan, the company's answer to European-style sedans like those from Volkswagen and Audi.
Chrysler has a bolder plan that will unfold next year: convincing Americans to start driving rear-wheel-drive cars again after being sold on front-wheel drive. The new Chrysler cars emphasize performance and have big engines and imposing grilles. One of these, the Chrysler 300C, will be "the new flagship of the Chrysler brand," Zetsche said. It will start around US$25,000 and go from zero to 60mph in 6.3 seconds. From Dodge will come the Magnum, a sort of tank-like station wagon.
Ford is expected to return to profitability this year, but on the back of its financing unit. Chrysler had set a goal of breaking even this year but said recently that it may not meet this projection.
Next year will be particularly crucial for Zetsche; Chrysler is three years into his turnaround effort.
"You're taking a big leveraged bet on a new philosophy," said Martilotti of Bear, Stearns, referring to the rear-wheel drive cars. "If it falls on its face they might have to do some more restructuring."
"Ford can do a dance in '04," he added. "The challenge for them is expectations are rising and they set the bar pretty low."
Zetsche recently sacked his marketing chief, and the company has put Celine Dion, its briefly omnipresent spokeswoman, largely on ice after a bid to make Chrysler a more upmarket brand stalled.
Now he appears ready to do anything and everything to move metal.
That includes Lingerie Bowl 2004, which "will attract the Dodge brand's core demographic and provides us with the opportunity to showcase the products that will appeal to this audience," according to Julie Roehm, the Chrysler Group's new director of marketing communications.
But what about female buyers?
"It's a strong male audience," said James Kenyon, a spokesman for Chrysler, referring to the market for Dodge trucks and sports cars.
"This kind of advertising is on the edge and is therefore likely to cause some unhappiness, and yet that's the risk you take when you're trying to reach an audience so many other competitors are trying to reach as well," he added.
"It's a huge game and lots of people will be clamoring for attention. We think this is a way to get noticed," Kenyon said.
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