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Chrysler’s “Plan”

29th September 2009

Automotive News reported last week that Chrysler-Fiat has a product strategy that includes the Chrysler brand moving way upscale, Dodge emphasizing driving dynamics and Jeep just staying Jeep, with a little fine-tuning.  Fiat, since taking control of Chrysler, has reorganized each of the brands under a CEO, who has total P&L responsibility for the brand.  That will work fine, as long as there is a referee who will decide which segments are appropriate and to make sure that overlap between the brands’ offerings are minimized.  As each of the brand CEOs report to Fiat CEO Sergio Marchionne, he seems to be the referee.

Chrysler brand CEO Peter “The Fongster” Fong says that the Chrysler brand needs to go upscale, but he is also considering a subcompact model.  That might work in Europe, where his boss works, but Americans generally equate luxury and status with size.  Bigger is better.  He adds that Chrysler will be “a notch above Lincoln, a notch above Cadillac.”  That is an admirable goal, but I sure hope he has a LONG time to accomplish this.  It takes YEARS and BILLIONS of dollars for new product programs to come to market and YEARS and HUNDREDS OF MILLIONS of dollars more to establish or change a brand identity – once you have the product.  The Fongster better hope Sergio doesn’t mind waiting a decade or 2 for results.

Dodge is going after the “driving dynamics” market, which sounds suspiciously like they’re going after BMW.  Good luck.  Everybody (Mercedes-Benz, Audi, Cadillac to name a few) has been going after BMW for many years, with only small degrees of success.  Now Dodge hopes to get in on this?  Please.  Dodge needs to be the affordable, sporty brand.  They must stay affordable because they don’t have another brand that can realistically sell affordable cars.  Maybe they should bring back Plymouth?

Jeep will stay Jeep.  At last, a good plan emerges from the rubble.  Jeep needs to cut back on its product lines and make darn sure it only sells products that are true to the Jeep brand.  That means no Compass or Patriot.  Jeep started calling its own products that still would meet the Jeep standard “Trail Rated” a few years ago, in anticipation of their slide into soft-utes.  Jeep should not produce anything that isn’t trail rated.

Also getting in the way is Fong’s point that the need to have “a broad array of products across every one of the segments.”  Wrong.  What each brand needs is a reasonable selection of products that are high quality, get good fuel economy for the segment and are true to the brand image they are trying to project.  Because all of the dealers will carry all of the brands going forward, each brand does not need to fill every segment or even many segments.  They only need to fill the segments that are true to the brands and enough of them to keep a viable, profitable dealer base.

That’s what I think – how about you?

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  1. Slandy – with you 100% on this one. The last Chrysler I drove was a 300 in a rental fleet. Even after discounting for that, the interior was horrible. I don’t see how they can ever bring Chrysler up to Lincoln or Cadillac.

    Dodge I have always thought was supposed to be the performance division like Pontiac (sigh) was for GM. But catch BMW?

    Your last paragraph is right on the money.

    Comment by jmungar — 29 September 2009 @ 3:20 pm

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