Thanks to a speedy exit from Chapter 11 bankruptcy, Chrysler ’s residual values have rebounded faster than expected. Chrysler’s resale values dipped 6 percent after the Michigan automaker filed for bankruptcy in May, but the company’s residuals have since rebounded by as much as 5 percent.
The Automotive Lease Guide announced on Thursday that it is increasing the residual values for all Chrysler brands – Chrysler, Dodge and Jeep – for the July-August period. According to ALG, the 36-month residual on Chrysler vehicles is up to 32.5 percent with the residual on Dodge-branded vehicles now up to 34.8 percent. Jeep has seen the largest jump in residual values, checking in with a value of 37.4 percent.
Although those values still aren’t up to pre-bankruptcy levels, they do show a marked improvement from just a few weeks ago. Just two weeks after filing for bankruptcy, Chrysler , Dodge and Jeep ’s residuals were at 28.8 percent, 31.2 percent and 32.4 percent, respectively.
“The bankruptcy proceedings were pushed through with unprecedented speed, which likely mitigated the impact on consumer perceptions of the brand,” said ALG in a report. “Nearly all of the at-risk inventory at the 789 dealers losing their franchise have either been sold or reallocated to surviving dealers.”
The news should be encouraging for General Motors as it prepares to exit Chapter 11 bankruptcy in the next few days.
