Autoline on Autoblog with John McElroy
by John McElroy on Nov 6th 2009 at 7:00PM 
CHRYSLER CONSIDERS GETTING BACK INTO BIG RIGS
One of the more intriguing tidbits that dribbled out of Chrysler's grueling 8-hour press conference on Wednesday is that the company is considering getting back into the heavy truck business. They're not talking about heavy duty pick-ups, they're talking about 18-wheelers.
Up until the early 1970's Dodge sold heavy trucks, including semi-tractors. In fact, Dodge trucks were famous the world over. But like GM and Ford, the Chrysler Corporation decided to get out of that business at a time when the commercial truck sector was under pressure.
When times are good heavy trucks generate a significant amount of profits. Mercedes-Benz, Volkswagen, Renault, Toyota (Hino), Nissan and Mitsubishi (Fuso) are still in the business. But it takes a lot of capital investment to get into and stay in the highly cyclical heavy truck segment, which is why the American car companies abandoned that market years ago.
In this case, the idea to get Chrysler back into the heavy truck market is Fiat's, not Chrysler's. And that is precisely why this could actually happen.
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John McElroy is host of the TV program "Autoline Detroit" and daily web video "Autoline Daily". Every week he brings his unique insights as an auto industry insider to Autoblog readers.
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Fiat is one of the largest heavy truck producers in the world, through its Iveco subsidiary. Most Americans are unaware of the company and its trucks because it doesn't sell them in the American market. But it sure would like to.
In fact, Iveco trucks are not sold in Mexico or Canada either, meaning it's missing out on one of the largest markets for heavy trucks in the world. It would take a lot of time and effort for Iveco to establish a distribution network to sell its trucks. But with Fiat taking over Chrysler, presto!, the Dodge dealer network offers an instant distribution system.
Or, I should say, the Ram network. As you're undoubtedly aware, Fiat is breaking Dodge trucks off from the Dodge brand and branding them as Rams. They must be thinking that as long as they're creating a new truck brand, why not extend the line from compact pick-ups all the way up to Class 7 or 8 semis?
And throw a couple of commercial vans into the mix while you're at it. Chrysler needs something to replace the Sprinter, and Fiat has just the vehicle it needs in the Ducato. Since Ford is bringing the Transit Connect to the American market, Fiat also has the perfect competitor to go up against it with the Doblo. In fact, like the Transit Connect, the Doblo is also made in Turkey, meaning it won't get killed by exchange rates.
It's easy to see why Fiat is thinking along these lines. By bringing its Iveco line to the NAFTA market, it helps justify its takeover of Chrysler. By providing Ram dealers with the kinds of commercial vehicles they haven't had in decades, it can potentially make them a lot more profitable.
This is a small chunk of Fiat's master plan for Chrysler, but I find it to be an intriguing piece. Whoever would've thought we'd live to see the Pentastar people back to selling big rigs?
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One of the more intriguing tidbits that dribbled out of Chrysler's grueling 8-hour press conference on Wednesday is that the company is considering getting back into the heavy truck business. They're not talking about heavy duty pick-ups, they're talking about 18-wheelers.Up until the early 1970's Dodge sold heavy trucks, including semi-tractors. In fact, Dodge trucks were famous the world over. But like GM and Ford, the Chrysler Corporation decided to get out of that business at a time when the commercial truck sector was under pressure.
When times are good heavy trucks generate a significant amount of profits. Mercedes-Benz, Volkswagen, Renault, Toyota (Hino), Nissan and Mitsubishi (Fuso) are still in the business. But it takes a lot of capital investment to get into and stay in the highly cyclical heavy truck segment, which is why the American car companies abandoned that market years ago.
In this case, the idea to get Chrysler back into the heavy truck market is Fiat's, not Chrysler's. And that is precisely why this could actually happen.
____________________________________________________________________________________
John McElroy is host of the TV program "Autoline Detroit" and daily web video "Autoline Daily". Every week he brings his unique insights as an auto industry insider to Autoblog readers.
____________________________________________________________________________________
Fiat is one of the largest heavy truck producers in the world, through its Iveco subsidiary. Most Americans are unaware of the company and its trucks because it doesn't sell them in the American market. But it sure would like to.
In fact, Iveco trucks are not sold in Mexico or Canada either, meaning it's missing out on one of the largest markets for heavy trucks in the world. It would take a lot of time and effort for Iveco to establish a distribution network to sell its trucks. But with Fiat taking over Chrysler, presto!, the Dodge dealer network offers an instant distribution system.
Or, I should say, the Ram network. As you're undoubtedly aware, Fiat is breaking Dodge trucks off from the Dodge brand and branding them as Rams. They must be thinking that as long as they're creating a new truck brand, why not extend the line from compact pick-ups all the way up to Class 7 or 8 semis?
And throw a couple of commercial vans into the mix while you're at it. Chrysler needs something to replace the Sprinter, and Fiat has just the vehicle it needs in the Ducato. Since Ford is bringing the Transit Connect to the American market, Fiat also has the perfect competitor to go up against it with the Doblo. In fact, like the Transit Connect, the Doblo is also made in Turkey, meaning it won't get killed by exchange rates.
It's easy to see why Fiat is thinking along these lines. By bringing its Iveco line to the NAFTA market, it helps justify its takeover of Chrysler. By providing Ram dealers with the kinds of commercial vehicles they haven't had in decades, it can potentially make them a lot more profitable.
This is a small chunk of Fiat's master plan for Chrysler, but I find it to be an intriguing piece. Whoever would've thought we'd live to see the Pentastar people back to selling big rigs?
###
Autoline Detroit
Airs every Sunday at 10:30AM on Detroit Public Television.
Autoline Detroit Podcast
Click here to subscribe in iTunes
Follow Autoline on Twitter for ongoing updates every day!
Reader Comments (Page 1 of 2)
DiRF 7:10PM (11/06/2009)
Return of the Bighorn? :D
Reply
Radio 7:22PM (11/06/2009)
I don't know ... compete against Peterbilt, Kenworth, Freightliner, International, Mack and Volvo? Times have changed since Dodge made a so-called heavy truck. Its a tough nut to crack.
Reply
Jim 9:00PM (11/06/2009)
it's not really that clear-cut anyway; the true # of competitors is pretty low in this market. Kenworth and Peterbilt are the same company (PACCAR,) Mack=Volvo, and Daimler owns almost everyone else other than International.
DasBoese 1:34AM (11/07/2009)
You forgot to mention MAN and Scania.
Jim 10:36AM (11/07/2009)
there are no Scania or MAN truck dealers in the United States.
Gardiner Westbound 7:52PM (11/06/2009)
I don't think so. If it cost a nickle to poop, Chrysler would have to vomit.
Reply
xtasi 7:59PM (11/06/2009)
@Radio: I don't think it would be a big deal. Corporate customers are not stuck on brands as much as consumers. In commercial trucks fuel mileage makes huge difference for operating costs, I think big rigs get around 1 to 2 mpg? If Fiat has something that is better, they will gain a lot of new customers. Big rigs are used for a ridiculous amount of miles.
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bhtooefr 9:17PM (11/06/2009)
More like 6-7 mpUSg.
mbslrm 10:19PM (11/06/2009)
I didn't see this in the five-year plan...
Reply
Avinash machado 2:54AM (11/07/2009)
So Dodge will be Chrysler's GMC?
Reply
Aprime 9:28AM (11/07/2009)
RAM... >_>
Tourian 9:54AM (11/07/2009)
I wouldn't really say Mitsubishi is still in the business since they sold most of the Fuso to DCX a while back. Maybe they still have some interest in it as far as the factories and some of the tech, but controlling interest belongs to the Germans. ASFAIK most all of the big name trucking companies are owned by like a handful of brands, so I really don't see Dodge seriously climbing back into a market that is so saturated and so difficult that only a few independant players exist any more.
Reply
chris 10:34AM (11/07/2009)
If you didn't see this coming you weren't really looking at Fiat very well. IVECO trucks would naturally be part of Fiat's plan to get back in the USA. They still have parts suppliers in the USA from the last time they sold trucks here. They still sell large generators
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chris 10:42AM (11/07/2009)
http://www.hankstruckpictures.com/pix/trucks/scott_lapachinsky/2006/02-24/more/m-05-43.jpg
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My_SS_RX8 12:34PM (11/07/2009)
My Dad drove Dodge 18 wheelers from the early 50's to late 60's. He drove Dodges for 2 different auto forwarding companies, Great Lakes Auto Forwarding and Eastern Auto Forwarding. He hauled various American mfg. cars from Michigan, Ohio, Indiana and occasionally Canada to southern and eastern dealers. Then at the ports of New York and New Jersey, he picked up VW's, MG's, Jaguars and some others which he then hauled throughout the east and south to various dealers.
When he overnighted at home on the way to somewhere else, I used to climb up into his truck trailer and sit in the cars. My favorites were the 120 and 140 Jags. I remember the Pontiac Parisienne and being confused by what it was, it looked like a Pontiac but the name confused me.
He commented in later years that the Dodges were not very sophisticated like todays trucks, and could beat you to death on the mountain roads of the eastern Appalachians, this was before the interstates. All of my uncles and many of my cousins drove truck, most of them Dodges. They were featured in Trucker News in 2007.
Reply
My_SS_RX8 4:33PM (11/07/2009)
for old truck fanciers, these are what i was remembering, they weren't actually 18 wheelers or called big rigs, as I remember, but these are the Dodges on pg3 at the top.
http://www.google.com/imgres?imgurl=http://i587.photobucket.com/albums/ss318/eymurphey/ChevyCarCarrier.jpg&imgrefurl=http://www.hankstruckpictures.com/forum01/index.php%3Ftopic%3D35575.15&h=438&w=640&sz=91&tbnid=cpzmpAQQtswn5M:&tbnh=94&tbnw=137&prev=/images%3Fq%3D1950%2527s%2Bdodge%2Bbig%2Brigs%2Bpics&usg=__0v66EniMd59I7t-XvbQqhcI2Cwc=&ei=CeX1SrnvLYuoswOhm6DwCQ&sa=X&oi=image_result&resnum=2&ct=image&ved=0CA0Q9QEwAQ
ocm 3:18PM (11/07/2009)
http://www.iveco.com.au/powerstar-beauty-and-the-beast/index.html
Reply
Jim 3:42PM (11/07/2009)
that one is made by International, at least in Australia.
ocm 4:29PM (11/07/2009)
But International Harvester Australia, following its involvement with Iveco, became Iveco International Trucks in 1992. In 2001, the company was renamed Iveco Trucks Australia.
Reply
Jim 4:10PM (11/08/2009)
wasn't aware of that. appreciate the information!