Chrysler Models Already on the Chopping Block

Sergio Marchionne took the reins of Chrysler less than a month ago, and already he's showing that life at the new Chrysler/Fiat isn't going to be la dolce vita. Taking advantage of the capital and credibility that come at the start of many corporate tenures, the CEO is making some very bold choices -- and some difficult ones, too.

Over the weekend, we mentioned that Marchionne is readying plans to rebadge a number of Dodge models for European markets and to rebadge Alfa Romeos for America. Now comes news that Marchionne also seeks to cut a number of underperforming and duplicative models from the Chrysler lineup. Facing the chopping block: the Chrysler Sebring, the Jeep Compass, the Jeep Patriot, and potentially the Dodge Caliber. Marchionne has stated that he hopes to have a "road map from a product standpoint" in place by the end of this week. How soon that road map might become public isn't known.

Another interesting option on Marchionne's table includes dropping brand promotion in favor of model promotion -- much like Fiat (FIATY.PK) has done with the 500, which is publicized in Italy simply as the "500", with any number of variants (e.g. the "500 Abarth"). That might take stress of individual product lines and focus attention on specific, popular vehicles. The Jeep Wrangler could be a candidate for such treatment.

A larger problem for Marchionne seems to be Chrysler's image among consumers. Some of the CEO's colleagues from Italy think the Chrysler brand needs a serious overhaul. Said Giuseppe Berta, professor of contemporary history at Bocconi University in Milan: "Chrysler models are old and they have little appeal on the market." Anecdotally speaking, there may be some truth to that; however, the new management might want to get statistical data to back up Berta's statements, since Nielsen's latest survey indicates that Dodge and Chrysler are the 5th and 6th most researched vehicles among American car buyers, respectively. Even more importantly: 88% of Chrysler autos are sold in the U.S. Consider that a few words to the wise.

Comments

[gollwoods:]

think of chrysler as a big tent circus, it has a new ringleader but the clowns are still there. they just need new little fire trucks to trot out before the tent collapses, and the animals escape to other places.
take it from a side show bit player this act won't go on the road for long.

Jul 06 06:36 PM

[Speedzzter:]

The RWDs (Challenger, 300, and Charger), the Minivans, the RAM pickup, and the Jeep Wrangler are the only essentials in Chrysler's line-up. All the rest are generally unloved and should be in-filled with FIAT products or new designs.

Of course the problem for Chrysler (other than the universal cash flow problems of the current automotive depression, the taints of bankruptcy and foreign/UAW ownership, niggling quality concerns, and the massive compliance costs created by President Obama's acceleration of Corporate Average Fuel Economy standards) is hanging on until any FIAT platforms are available.

Jul 06 07:04 PM

[Steven Hansen:]

before this fiat chrysler orgy gets going, i do not know any model of fiat which will hold up to the miles driven on usa roadways. the smaller models of fiat are too small for fat americans.

this cannot be a process of simple rebadging and/or transfer of assembly to america of fiat models. they failed the first time they tried to enter the usa market.

if they are smart, they will marry italian design with chryslers' dependability.

Jul 07 04:58 AM

[Doc 224899:]

Jeep Division Question: Can somebody tell me why the federal government hasn't bought Jeep division, or bailed it out somehow, and put our military personnel on the ground into the driver's seats of thousands of Jeep Wranglers?

Look at the cost of all the light vehicles our troops ride around in. You would think there'd be a place for Jeeps.

Jul 07 05:27 AM

[The Betsy:]

So how is this global marketing supposed to work? One size fits all? "When in Rome, do as the Romans do," but when in the U.S., fuggetaboutit? Every Dodge Caliber owner I've met loves their car -- the size, roominess, versatility, the great mpg (28+city/32-36hwy), safety rating, the affordability. I've talked to approximately 20 owners face-to-face, and have read dozens of blogs. Why put a winner on the chopping block?

Same story on the bioidentical Jeep Patriot. But my new Jeep Patriot is even roomier than the Caliber and is supposed to get 23 city/28-32 hwy. It's getting better than that -- 28 city/34 hwy (so far). I hear it will improve after I drive it longer. How is this considered "underperforming?" That would be a marketing issue, not engineering.

So, how is this global marketing supposed to work?

Jul 07 06:44 PM

[Eye Forget:]

"i do not know any model of fiat which will hold up to the miles driven on usa roadways"

A luddite view reminiscent of the early days of Toyota and Honda.

"the smaller models of fiat are too small for fat americans."

The model range sizing is comparable to the smaller Far Eastern cars. Does not appear to be much of an issue.

Jul 20 07:57 PM