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Sergio Marchionne's ambitious plan to revive Chrysler with a wave of new products divides the world into halves--one set of vehicles engineered by Chrysler for itself and Fiat and another set engineered by Fiat for itself and Chrysler.
The alliance starts to bear fruit in 2012 and gathers momentum with a spate of launches in 2013.
Marchionne said this month that the two automakers were now "inextricably intertwined."
The greatest cross-pollination of Chrysler and Fiat expertise will take place in the middle of the market. Chrysler engineers are taking a European Fiat platform called the C-Evo and re-engineering and widening it into a new platform called C/D that will spawn a fleet of vehicles.
If all goes according to plan, seven or eight new Chrysler, Dodge, and Jeep vehicles will come off that C/D platform aimed squarely at the middle of the domestic market. There will be two compact sedans in 2012 to replace the Dodge Caliber and Chrysler PT Cruiser.
And in 2013 there will be a wave of vehicles, including a compact crossover to replace the Jeep Patriot; a midsized SUV to replace the Jeep Liberty; midsized sedans to replace the Chrysler Sebring and Dodge Avenger; a midsized crossover for Chrysler; and possibly a midsized crossover to replace the Dodge Nitro.
More than any other factor, it was the failure to field strong competitors to vehicles such as the Honda Accord, Toyota Camry, Ford Escape, and Toyota RAV4 that led to Chrysler's sales collapse and eventual trip into bankruptcy last spring.
Cross-fertilization
The two partners will lean heavily on each other to engineer and manufacture products.
"From an architectural standpoint, we're going to end up with the world [divided] into two parts," said Marchionne at the Nov. 4 unveiling of Chrysler's five-year business plan. "A part will be handled by Fiat for itself and on behalf of Chrysler, and another one will be handled by Chrysler for itself and for Fiat."
All vehicles below the compact sedan segment for Fiat Auto and Chrysler Group brands will be engineered in Italy and built there or in Fiat factories elsewhere. All larger vehicles--starting with the replacements for the Caliber and PT Cruiser and including minivans, large SUVs, and pickups--will be engineered by the Chrysler team in Auburn Hills, and most will be made in North American factories.
That means, for example, that Fiat will drop out of its minivan alliance with PSA/Peugeot-Citroen. Future Fiat and Lancia minivans will be engineered in Auburn Hills and made in North American factories for export.
On the flip side, starting in 2013, Lancia could export to North America a subcompact five-door hatchback that would become the entry model for the Chrysler brand. Dodge also will get a subcompact engineered by Fiat and imported to the United States.
But it's in the midsized segment that Chrysler benefits--starting in 2013.
In July, Fiat handed over to Chrysler the C-Evo platform with European specifications to serve as the underpinnings of a new group of vehicles.
For the United States, Chrysler is widening the platform by 1.6 inches. By redoing the platform, Chrysler could avoid the mistakes made by other automakers. In the 1990s, Ford brought its European mainstream Mondeo sedan to North America and rebadged it as the Ford Contour and Mercury Mystique. But U.S. customers found the sedans too cramped.
Philippe Houchois, analyst for UBS in London, estimated that Chrysler and Fiat could produce a combined 750,000 units annually off the C/D platform.
A better fit than Daimler?
Dave Cole, head of the Center for Automotive Research in Ann Arbor, Mich., said the Fiat-Chrysler alliance balances the needs of two carmakers in a way that Chrysler's merger with Daimler never did.
Such synergies weren't possible between Daimler and Chrysler because "what they were essentially doing is taking two companies with little product overlap and somehow sticking them together. It was just not in the cards that they would be able to pull that off."
Marchionne and his team face some big obstacles as he aims for U.S. market share in the 13-14 percent range. Chrysler is now hovering around 9 percent.
Houchois said, "Marchionne's plan is probably too ambitious on market share and extremely cautious on market assumptions."
If Chrysler can't hit Marchionne's market share target, he said, it could still achieve sustainable volume if the market itself grows.
John Wolkonowicz, analyst for IHS Global Insight in Lexington, Mass., said the plan sounds good, but Chrysler has to sell some vehicles between now and when the new products start arriving to pay for the planned new product assault.
"If they actually get to the new products," he said, "they have a fighting chance."
(Source: Automotive News)
DETROIT -- Chrysler brand CEO Olivier Francois startled an audience of more than 400 journalists and analysts last week by showing video footage of a couple passionately making out in the back seat of a Chrysler 300.
A voice says: "Let's design cars people want to make out in again, cars people want their pictures taken in." The clip shows such fashion icons as Coco Chanel and Giorgio Armani and lays out a bold new vision for the Chrysler brand.
The voice says: "What ever happened to style? It wasn't too long ago America had it. At Chrysler, we believe it's time to get it back, to regain the style."
Last week Francois was one in a parade of Chrysler Group brand bosses seeking to reclaim lost glory with daring plans. Group CEO Sergio Marchionne is betting Francois and his peers at Dodge, Jeep and Ram truck will redefine their brands for new customers with the help of fuel-efficient, Fiat-based vehicles.
The challenge is daunting. In recent years, General Motors gave Saturn highly regarded vehicles based on European Opels. The brand failed anyway.
On the other hand, the Mercedes-influenced Chrysler 300 was the biggest hit of the decade-long DaimlerChrysler alliance.
Observers were impressed by the plan unveiled by Marchionne and his team to reinvent its old brands for a new generation of customers.
Chrysler will spend up to $23 billion on new products, manufacturing and brand building over five years, hoping to push market share from its current 9 percent to more than 13 percent. Planned are about a dozen new vehicles underpinned by Fiat platforms and technology.
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The new digital owners guide pictured with the old paper manuals
(Credit: Chrysler Group LLC)As cars become more complex, the accompanying user manuals have become proportionally thicker. These days, your average luxury sedan or SUV will often come with a vehicle manual, a navigation manual, separate safety systems manuals and pamphlets, and--in the case of hybrids--a final manual to explain how the powertrain works. That's a good deal of paper that will most likely only be referenced once or twice (if at all).
For its 2010 model Chrysler, Jeep, and, Dodge vehicles, Chrysler Group LLC will be ditching the bulk of its paper manuals and replacing them with digital DVD manuals. The automaker will be the first to do so. According to Chryler's press release:
"The DVD includes the owners' manual, vehicle and tire warranty information, navigation and entertainment system guides, as well as information on 24-hour towing assistance. Video tutorials also are available for commonly used features, such as folding down a Jeep Wrangler soft-top, operating the video entertainment system and setting electronic speed control. In addition, owners may search by topic rather than sifting through a 500-page book."
"The printed user guide includes photos and diagrams allowing customers to quickly find assistance for emergency situations, such as changing tires, jump-starting a battery or assessing warning lights. The printed guide also covers basic operating procedures for temperature control, windshield wipers, seat adjustment and navigation systems."
Luddites and your grandparents can request a traditional printed manual by contacting their dealer or calling customer service. The switch will save 930 tons of paper, the equivalent of 20,000 trees, on an annual basis and save about 4 pounds of paper per vehicle.
So, loyal readers, what do you think about the jump to digital manuals? Is this something you'd like to see more automakers emulate?
(Credit:
Jankel Group)
Jeep stakeholders reasserted their intention to regain a share of the international military market at the Defence Systems & Equipment International Exhibition in London this week.
Chrysler has teamed up with the Jankel Group to market a new tactical version of the commercially available Jeep Unlimited. The Jeep J8 (it's the eighth version of the Wrangler) has been extensively modified but retains the long wheelbase, drive train, and distinctive profile (PDF).
The J8 will be available in 12 configurations including light patrol, pickup truck, personnel carrier, armored, and ambulance variants.
"What the J8 is, really, is a tremendously capable and flexible platform for modifications," said Jack Robinson, Jeep's government and military sales general manager. "Our business model is to have Jankel, JGMS' parent company, work with Jeep engineering to create a family of vehicles."
Chrysler reinforced the frame; added heavy-duty brakes, radiator, and suspension; upgraded the axles; and added a rugged air filtration system designed to withstand fives hours in a desert sandstorm. It then dropped in a VM Motori 2.8L, four-cylinder turbo diesel engine. The company adapted many of the upgrade parts from its Dodge truck.
Options available from Jankel's armor shop will include add-on roll-bars, tubular mounts for weapons and accessories, a weapon turret, a folding windshield, ballistic armor, and the essential convertible soft-top.
American Expeditionary Vehicles already offers a civilian version of a military-focused Wrangler--the EV J8 MILSPEC, calling it the most durable Jeep platform ever offered to the U.S. public. It comes completely assembled, but you have to add your own power--either the diesel or a 5.7L HEMI V8.
Assembly of Jankel's version will take place in South Carolina, with sticker prices starting at $30,000. Urban soccer moms, take note.
The Chrysler Group today announced new incentives, "Double CA$H for Your Old Car," that can save consumers up to $9,000 toward the purchase of a new Chrysler, Jeep, or Dodge vehicle.
Beginning July 23, 2009, Chrysler Group LLC will offer up to $4,500 Consumer Cash or 0 percent financing for 72 months through GMAC Financial Services on most 2009 model vehicles. These incentives are valid through August 31.
The U.S. Government's Car Allowance Rebate Systems (CARS) program, more commonly known as "cash for clunkers," also starts July 23, 2009. The CARS program offers a government credit of either $3,500 or $4,500 for trading in an inefficient vehicle that is not more than 25 years old for the purchase of a new vehicle. The amount of the credit is determined based on the fuel-economy improvement between the turn-in vehicle and the new vehicle purchased.
And a Missouri dealership is offering a free AK-47 with purchase of a new car. Here's a Fox Business News report on why the dealer is making such an offer:
Used overseas by the Egyptian army, the Jeep J8 will be available in the U.S. later this year. Pickuptrucks.com reviews the rugged J8. American Expedition Vehicle dealers will make it available to customers with a rolling chassis, and choice of engine--four-cylinder diesel or Hemi V-8. There is no interior carpeting and no sound system.
The J8 will sell for about $50,000.
NEW YORK -- With the redesigned 2011 Jeep Grand Cherokee, Chrysler LLC aims to create a luxury luster for the Jeep brand.
The Grand Cherokee takes aim at luxury crossovers and SUVs such as the Lexus RX, BMW X5, Range Rover and Mercedes-Benz ML. The Jeep arrives in dealerships in spring 2010.
The Grand Cherokee will be Chrysler's most important launch until 2011, when products from its alliance with Fiat S.p.A. are expected to start rolling off North American assembly lines. And the Jeep will offer a peek at Chrysler LLC's strategy to be a smaller, more profitable company with more upscale products.
"We now have the bones to take the brand anywhere we want to," said Chrysler design chief Ralph Gilles in an interview at the auto show here.
The redesigned Jeep should boost per-vehicle profits.
(Credit: Automotive News)Luxurious features
Built on the same platform as the Mercedes-Benz ML, the next-generation Grand Cherokee was well under way when Daimler AG and Chrysler divorced in 2007. When the Grand Cherokee appears in dealerships next year, it will have features and options typically found only in luxury cars.
Those items include adaptive cruise control, forward collision warning, remote start and a Quadra Lift suspension system that can lift the vehicle 4.5 inches higher than its normal mode when parked. A system called Selec-Terrain comes with a 5.8-liter Hemi V-8.
Chrysler will offer a diesel, but not for North America. The company stopped making the Grand Cherokee diesel model late last year because of lack of demand.
'Very affordable'
Chrysler hopes to keep the Grand Cherokee's price reasonable by sharing under-the-skin hardware with Mercedes and by selling the Grand Cherokee at large volumes, both in North America and around the world.
"We'll be able to offer it at a very affordable volume price," said Chrysler co-President Jim Press at the auto show. Chrysler has not determined prices or discussed volumes. The vehicle will be made at Chrysler's Jefferson North plant in Detroit.
(Source: Automotive News)
Astronomical gas prices last year seemed to kill the SUV market, but automakers at the New York auto show disagree. Mercedes-Benz rolls out a hybrid version of its ML-class, offering a high-tech power train in a luxury SUV. Jeep tries to make a case for its continued survival with a modern-looking Grand Cherokee featuring an impressive cabin tech roster. And GMC shows off the Terrain, an all-new model to add to its large line of SUVs.
(Credit:
Corinne Schulze/CNET)
The 2009 Jeep Compass is available with a cabin tech package that we've come to love: Chrysler's UConnect system. With hard drive-based navigation and media storage, there's a lot to like about the UConnect suite.
Unfortunately, our Compass was equipped with none of this tech and without that UConnect package, there's not much to like about the Compass. Power delivery was pathetic as the Jeep's 2.4-liter engine struggled to keep up with the vehicle's heft. Handling was also disappointing, despite the fact that our Compass was an all-wheel drive model.
Suffice it to say that we didn't enjoy our time with the Compass. Even the full-blown UConnect package wouldn't change our minds about that.
Fiat makes the tiny 500 model, which after this deal could gain entry to the U.S.
Dodge's massive Ram pick-up could find new markets based on Fiat's European presence.
Today, Chrysler announced it gave Fiat a 35 percent stake in its company, initiating a partnership that gives both companies access to new markets and technologies. Chrysler has suffered over the past few years because of its model line-up of trucks and SUVs, which haven't been selling well, and its lack of presence in international markets. Fiat wants to reenter the U.S. market, and could benefit from Chrysler's dealer network. We might soon see Dodge Challengers ripping across Europe, and Chrysler Dodge Jeep dealerships in the U.S. adding Fiat and Alfa Romeo to their signs.
The deal also lets Chrysler build cars based on Fiat platforms, opening up the possibility of a new generation of small, economical Dodge and Chrysler-badged cars. In Europe, Fiat has a Microsoft-powered system called Blue and Me, which offers similar features to Ford's Sync system, such as cell phone and MP3 player connectivity. With the new partnership, Chrysler could adopt that technology in its cars, giving Ford some new competition. Of course, we would really like to see Dodge adopt Fiat-owned Ferrari engine technology.
(Via Washington Post)
