Chrysler Is Getting Hammered: Do You Think Cerberus is having second Thoughts?

Implications: Consumers are bailing out on Chrysler LLC--the sign of a company in crisis.

Analysis: One thing you can take to the bank, when consumers get a whiff of trouble associated with a company they're doing business with, trust their instincts, they're usually right.

Despite a four-day flurry of leasing business at the end of July to beat Chrysler Financial's exit from the sector, Chrysler still posted the biggest loss of any automaker in July U.S. sales.

The company's overall 28.8 % plunge to 98,109 light vehicles slightly exceeded General Motors' 26.1% decline.

But the July results exposed the weakness of Chrysler's car lineup in the glare of the U.S. market's abrupt shift from gas-guzzling pickups and SUVs to fuel efficient cars. Chrysler LLC truck sales fell 29.0% in July, close to the industry's 25.8% truck slide. But while industry sales of cars were flat in July, Chrysler LLC car volume fell 28.2%

More than GM or Ford, Chrysler let its cars go as everyone focused on trucks, so, as trucks are punished in the marketplace, Dodge is punished disproportionately.

The U.S. marketplace hammered most automakers in July, with Toyota joining Ford, GM and Mazda in posting double-digit losses, with Honda off 1.6%. Nissan fared best among the top six automakers with an 8.5% gain.

Chrysler has been trying to counter what they describe as a lot of false speculation about the health of the company. For the first time since it became a privately held company, the company disclosed financial results.

According to the company for the first six months of 2008, Chrysler had an operating profit of $1.1 billion and its cash on hand as of June 30 was $11.7 billion.

Because the company is privately owned, details on how they arrived at the $1.1 billion figure are not subject to public scrutiny.

Chrysler Financial announcement on July 25 that it was ending consumer vehicle leases triggered a rush of last-minute shopping that helped many dealers.

Going forward, Chryslers dealers as well as my domestic dealer clients are concerned about public perception of Chrysler as a "company in trouble"  and to a lesser degree all domestic automakers. The negative word on the street is keeping serious shoppers away.