Chrysler to kill up to 5 models this month
10-17-07, 05:53 PM
#1
Speaks French in Russian
Thread Starter
Chrysler to kill up to 5 models this month
Chrysler set to ax models
Up to 5 that compete with other company vehicles are likely to go
http://www.freep.com/apps/pbcs.dll/a...60019/1118/RSS
Up to 5 that compete with other company vehicles are likely to go
Chrysler LLC could cut as many as five nameplates within the month as part of its quick and dramatic makeover as a newly private company.
It's "highly likely" Chrysler's top brass will approve plans to kill vehicles this month, a person familiar with the situation told the Free Press. About five vehicles are being considered for elimination, but the source would not reveal which ones.
The boardroom drama could help explain why the UAW was unable to win the same sort of future-product guarantees in its tentative labor deal with the Auburn Hills automaker as it did in its deal with General Motors Corp.
The product review comes as the automaker is seeking to get its tentative agreement with the UAW ratified by rank-and-file union members.
GM has already won ratification of what analysts see as a potentially transformational contract that can give Detroit automakers nearly equal labor costs to Toyota Motor Corp.'s nonunionized U.S. factories.
But Chrysler union local leaders have complained that unlike the GM contract, the proposed Chrysler deal fails to reclassify lower-paid temporary workers as permanent hires and lacks the kind of plant-by-plant outline of possible future products listed in the union's description of the GM agreement.
Bob Nardelli, who became Chrysler's chief executive officer in August, shortly after Cerberus Capital Management took majority control, indicated in a September speech that the company could reduce its model offerings.
Once Chrysler's product evaluation committee makes its decision about eliminating nameplates, it's believed the decision will be sent to Cerberus management for approval.
Chrysler officials say the company has been meeting about the product lineup, assessing the vehicles sold by the company and contemplating what needs to be cut.
"We have models that overlap, where we have two or three vehicles that serve the same market segment and maybe the same customer and actually compete with each other to some extent," Chrysler President and Vice Chairman Jim Press told reporters last week. "We also have markets where we have insufficient coverage. Where we don't have enough product."
Press did not discuss specific model eliminations. A Chrysler spokesman declined to comment.
The likeliest models to go
Auto industry analysts predict the Chrysler Pacifica, Dodge Dakota, and Jeep Commander and Compass could face elimination. A company insider included those vehicles among a list of vehicles facing review. The source and another familiar with Chrysler's design pipeline also questioned the future of the Chrysler Sebring and Dodge Durango.
The Chrysler Sebring is being considered for a complete makeover, though if that is not feasible, the car will probably be eliminated, the company insider said.
Yet another person familiar with Cerberus' thinking said the private equity firm questions why Chrysler's lineup includes the Dodge Durango SUV, which has seen its U.S. sales slide 30% this year.
A Cerberus spokesman did not respond to an inquiry regarding this story.
The number of eliminations "could go higher in the sense that products as we know them today, but something will take their place, just not a direct next-generation replacement," analyst Catherine Madden of Global Insight said.
The Durango is built at the Newark, Del., assembly plant, which will be closed in 2009.
"I think the Durango is dead in the water. I won't order a Durango anymore. I told my guys don't ever order another Durango," said Carl Galeana of Galeana Automotive Group, which includes Van Dyke Dodge in Warren.
The UAW's summary of the tentative labor agreement with Chrysler says the automaker's next generation crossover will be built at the Jefferson North Assembly Plant in Detroit, where the Jeep Grand Cherokee and Jeep Commander are currently made.
The idea of fewer Chrysler, Dodge and Jeep nameplates in North America was first hinted at in February when then-CEO Tom LaSorda unveiled the company's plan to stop losses. The plan called for avoiding nameplate redundancies.
Looking for a new image
Chrysler lost $680 million last year and $2 billion in the first three months of this year. Its U.S. sales are down 3% so far this year while its market share has remained steady -- something its Detroit rivals can not claim. The automaker wants to recast its brands' images, Press said, making Chrysler seen as upscale; Jeep as rugged and off-road capable; and Dodge as high-volume cars and trucks.
"There are probably a lot of things being rethought at Chrysler right now," said Erich Merkle, director of forecasting for IRN Inc. "Just because you have a platform doesn't necessarily mean it has to go across all three divisions."
It's "highly likely" Chrysler's top brass will approve plans to kill vehicles this month, a person familiar with the situation told the Free Press. About five vehicles are being considered for elimination, but the source would not reveal which ones.
The boardroom drama could help explain why the UAW was unable to win the same sort of future-product guarantees in its tentative labor deal with the Auburn Hills automaker as it did in its deal with General Motors Corp.
The product review comes as the automaker is seeking to get its tentative agreement with the UAW ratified by rank-and-file union members.
GM has already won ratification of what analysts see as a potentially transformational contract that can give Detroit automakers nearly equal labor costs to Toyota Motor Corp.'s nonunionized U.S. factories.
But Chrysler union local leaders have complained that unlike the GM contract, the proposed Chrysler deal fails to reclassify lower-paid temporary workers as permanent hires and lacks the kind of plant-by-plant outline of possible future products listed in the union's description of the GM agreement.
Bob Nardelli, who became Chrysler's chief executive officer in August, shortly after Cerberus Capital Management took majority control, indicated in a September speech that the company could reduce its model offerings.
Once Chrysler's product evaluation committee makes its decision about eliminating nameplates, it's believed the decision will be sent to Cerberus management for approval.
Chrysler officials say the company has been meeting about the product lineup, assessing the vehicles sold by the company and contemplating what needs to be cut.
"We have models that overlap, where we have two or three vehicles that serve the same market segment and maybe the same customer and actually compete with each other to some extent," Chrysler President and Vice Chairman Jim Press told reporters last week. "We also have markets where we have insufficient coverage. Where we don't have enough product."
Press did not discuss specific model eliminations. A Chrysler spokesman declined to comment.
The likeliest models to go
Auto industry analysts predict the Chrysler Pacifica, Dodge Dakota, and Jeep Commander and Compass could face elimination. A company insider included those vehicles among a list of vehicles facing review. The source and another familiar with Chrysler's design pipeline also questioned the future of the Chrysler Sebring and Dodge Durango.
The Chrysler Sebring is being considered for a complete makeover, though if that is not feasible, the car will probably be eliminated, the company insider said.
Yet another person familiar with Cerberus' thinking said the private equity firm questions why Chrysler's lineup includes the Dodge Durango SUV, which has seen its U.S. sales slide 30% this year.
A Cerberus spokesman did not respond to an inquiry regarding this story.
The number of eliminations "could go higher in the sense that products as we know them today, but something will take their place, just not a direct next-generation replacement," analyst Catherine Madden of Global Insight said.
The Durango is built at the Newark, Del., assembly plant, which will be closed in 2009.
"I think the Durango is dead in the water. I won't order a Durango anymore. I told my guys don't ever order another Durango," said Carl Galeana of Galeana Automotive Group, which includes Van Dyke Dodge in Warren.
The UAW's summary of the tentative labor agreement with Chrysler says the automaker's next generation crossover will be built at the Jefferson North Assembly Plant in Detroit, where the Jeep Grand Cherokee and Jeep Commander are currently made.
The idea of fewer Chrysler, Dodge and Jeep nameplates in North America was first hinted at in February when then-CEO Tom LaSorda unveiled the company's plan to stop losses. The plan called for avoiding nameplate redundancies.
Looking for a new image
Chrysler lost $680 million last year and $2 billion in the first three months of this year. Its U.S. sales are down 3% so far this year while its market share has remained steady -- something its Detroit rivals can not claim. The automaker wants to recast its brands' images, Press said, making Chrysler seen as upscale; Jeep as rugged and off-road capable; and Dodge as high-volume cars and trucks.
"There are probably a lot of things being rethought at Chrysler right now," said Erich Merkle, director of forecasting for IRN Inc. "Just because you have a platform doesn't necessarily mean it has to go across all three divisions."
10-17-07, 06:05 PM
#2
Lead Lap
Join Date: Jun 2006
Location: MD
Posts: 4,511
Likes: 0
Received 0 Likes
on
0 Posts
The Chrysler Sebring is being considered for a complete makeover, though if that is not feasible, the car will probably be eliminated, the company insider said.
10-17-07, 07:22 PM
#3
Lexus Fanatic
Join Date: May 2003
Location: Massachusetts
Posts: 7,864
Likes: 0
Received 0 Likes
on
0 Posts
I think things will be looking up for Chrysler with some of this restructuring.
My suggestion:
Dodge needs to develop a new small sedan focusing on fuel efficiency and value for under $13K to start (think Yaris). The Caliber just isn't filling that segment although Dodge should certainly keep that in the lineup as well.
Fuel efficiecy sells cars now and all companies should make this a priority. Chrysler has focused too much on gas guzzling Hemi's lately which gives Chrysler an image opposite of fuel efficiency.
My suggestion:
Dodge needs to develop a new small sedan focusing on fuel efficiency and value for under $13K to start (think Yaris). The Caliber just isn't filling that segment although Dodge should certainly keep that in the lineup as well.
Fuel efficiecy sells cars now and all companies should make this a priority. Chrysler has focused too much on gas guzzling Hemi's lately which gives Chrysler an image opposite of fuel efficiency.
10-18-07, 07:15 AM
#5
Lexus Champion
If true, my read of that is they would do what Ford did to the Taurus (before flip-flopping)--on the next remodel, kill the Sebring name, and call the replacement by another name.
10-18-07, 08:17 AM
#6
Quite honestly, I probably see as many Pacificas as Explorers and Highlanders in Atlanta. I don't see why they would kill it off.
Compass has become quite popular here as well, and I see plenty of Dakotas and many Commanders.
From my experience, all of these models seem to be doing very well in my area but I do not know about the business case in other places. I feel like I could see a reason for the Durango to go, but maybe just because it needs a redesign. I feel like a full size SUV would be necessary in Dodge's "macho" lineup.
One thing that has always puzzled me about domestic car companies is their product lines. The Japanese and Germans keep things simple- low end (Scion), middle (Honda/Toyota/Nissan, and high end (Acura, Lexus, Infiniti). This eliminates so much confusion for customers and lends a clearer product image and honestly...the ability for each brand to do more.
-Simply put, MERCURY NEEDS TO DIE. The brand brings in dismal sales numbers and it's manufacturing capacity could be used for other models or shut down all together. The company offers nothing that Ford doesn't, and last time I heard there were no new products in the pipeline. Done. Cut the cable. Pull the cord.
-GM has done a better job with restructuring it's brands, but at the same time I cannot really see a reason for an Aura, G6, Malibu, and a LaCrosse. All FWD sedans that are the same size and in the same price bracket. SUVs, trucks, and many of their other sedans all compete with eachother in-house, without even considering other brands. How is this beneficial? GM must think, "Well if we give them four different choices then we have four times the chances as someone else to get them to buy a car from us." Did anyone think that these situations (especially when many GM brands are lumped together in the same retail stores) create a large amount of buyer confusion and uncertainty? Guess what, they do! And you're being outsold by cars that have no other in house competitors, read- one "choice" as opposed to four.
-Chrysler could arguably be in better standing than the other two because it's now down to three brands which all seem to be at least moderately successful. Dodge is rough and bold, Chrysler classy and refined, and Jeep is SUVs. They need to cut some of the fat and refine their product lines, but I think they will be fine. To be honest, the POS Sebring isn't helping them at all and that should be their first project.
It's just frustrating to see the American companies foddering along and then crying "Woe is me" but honestly they have more cars and brands than they NEED or than they really know what to do with. Come on! Cut your losers and pick products that you can really focus on and really make competitive. More than that, make sure that FOUR of your products don't directly compete with eachother. Offering consumers one choice makes their buying decision much easier.
Compass has become quite popular here as well, and I see plenty of Dakotas and many Commanders.
From my experience, all of these models seem to be doing very well in my area but I do not know about the business case in other places. I feel like I could see a reason for the Durango to go, but maybe just because it needs a redesign. I feel like a full size SUV would be necessary in Dodge's "macho" lineup.
One thing that has always puzzled me about domestic car companies is their product lines. The Japanese and Germans keep things simple- low end (Scion), middle (Honda/Toyota/Nissan, and high end (Acura, Lexus, Infiniti). This eliminates so much confusion for customers and lends a clearer product image and honestly...the ability for each brand to do more.
-Simply put, MERCURY NEEDS TO DIE. The brand brings in dismal sales numbers and it's manufacturing capacity could be used for other models or shut down all together. The company offers nothing that Ford doesn't, and last time I heard there were no new products in the pipeline. Done. Cut the cable. Pull the cord.
-GM has done a better job with restructuring it's brands, but at the same time I cannot really see a reason for an Aura, G6, Malibu, and a LaCrosse. All FWD sedans that are the same size and in the same price bracket. SUVs, trucks, and many of their other sedans all compete with eachother in-house, without even considering other brands. How is this beneficial? GM must think, "Well if we give them four different choices then we have four times the chances as someone else to get them to buy a car from us." Did anyone think that these situations (especially when many GM brands are lumped together in the same retail stores) create a large amount of buyer confusion and uncertainty? Guess what, they do! And you're being outsold by cars that have no other in house competitors, read- one "choice" as opposed to four.
-Chrysler could arguably be in better standing than the other two because it's now down to three brands which all seem to be at least moderately successful. Dodge is rough and bold, Chrysler classy and refined, and Jeep is SUVs. They need to cut some of the fat and refine their product lines, but I think they will be fine. To be honest, the POS Sebring isn't helping them at all and that should be their first project.
It's just frustrating to see the American companies foddering along and then crying "Woe is me" but honestly they have more cars and brands than they NEED or than they really know what to do with. Come on! Cut your losers and pick products that you can really focus on and really make competitive. More than that, make sure that FOUR of your products don't directly compete with eachother. Offering consumers one choice makes their buying decision much easier.
Huh??
10-19-07, 10:05 AM
#15
Originally Posted by blacksc400
kill the 300!!! I am tired of it..
Of course, if you leave it up to American Brands, you get companies like AMC
