It’s no understatement to say that this is a critical year for Chrysler. The struggling automaker will be bringing several refreshed or redesigned vehicles to market, the first updating of the company’s lineup since it went through multiple traumas.
The last two years have seen the smallest of the “Big Three” limping along on government assistance, sparring with debt-holders, going through bankruptcy reorganization, closing hundreds of dealerships, and having to find a corporate partner in Italian carmaker Fiat just to remain viable. Alas, plummeting vehicle sales have accompanied all of this turmoil.
Make no mistake, new product development was not the forte of Chrysler’s former parent company, Cerberus Capital Management. All of its other problems aside, Chrysler’s model lineup has grown long-in-the-tooth.
“Chrysler lost about 12 months worth of product development [under Cerberus], which is a very long time in the auto industry,” said Stephanie Brinley, an analyst for AutoPacific Group, in Troy, Mich. “Compounding that issue is their financial situation. Coming out of bankruptcy, and with sales revenues being down for so long, they don’t have as much money to advertise as Ford and GM do. But they need to build awareness for the redesigned products they have coming up.”
From consumers to journalists to analysts to dealers, impatience with the pace of Chrysler’s new model introductions abounds.
“They weren’t even able to display any new product at the Detroit auto show in January,” said Anthony Pratt, an analyst for Autofacts, a division of PricewaterhouseCoopers LLP.
Apparently the carmaker has taken heed, and recent reports indicate that it is pulling ahead some new products in an effort to jumpstart sales.
For starters, the slow selling Chrysler Sebring is reportedly going to be dropped from the line-up, in favor of a new nameplate. “Nassau” will be a freshened version of this midsize sedan, launching late this year as a 2011 model. Chrysler designers have also been working on a completely new interior for the 2011 Dodge Avenger, the sister car that shares a platform with the Sebring.
The Nassau name was used on a Chrysler concept car that was displayed at the 2007 Detroit Auto Show, but insiders don’t expect the new Nassau to bear much resemblance to that concept vehicle. Sebring “did not meet the company’s volume goals,” said Pratt, who explained that the venerable nameplate has suffered because of Chrysler’s over-reliance on fleet sales.
Chrysler will be rolling out its redesigned 2011 Jeep Grand Cherokee, due this summer and powered by its new 280-horsepower Pentastar V6. The Chrysler 300 and Dodge Charger are also slated for a 2011 redesign. This pair was initially slated to arrive at the end of the year, but the latest scuttlebutt is that the Charger may come to market sooner, ahead of the 300.
Finally, the Fiat 500 is also slated to hit these shores in the coming months. This Mini-fighter will be the first tangible benefit of Chrysler’s union with Fiat, and a harbinger of things to come.
In order to move 2010 models before the new metal arrives, the company this week announced aggressive low-interest financing across its Chrysler, Dodge and Jeep lineups. 0% interest is available up to 60 months, or 1.9% for 72 months. The company hopes to maintain the momentum it saw in April's sales numbers, which were up an impressive 25% over the same period in 2009.
The Italian Job
Chrysler is hoping that these updated 2011 models will add some pizzazz to its product offerings during a crucial time, as the company pushes entirely new Fiat-influenced vehicles through the pipeline as expeditiously as possible. Chrysler considers these smaller, more fuel-efficient cars the key to improving its position in the marketplace. But Chrysler won’t begin to realize these benefits until 2013, when it plans to introduce an entirely new midsize car based on a Fiat platform.
Brinley believes that Fiat, under CEO Sergio Marchionne’s leadership, “is a much stronger partner for Chrysler than it had in Daimler or Cerberus. Based on what I’ve seen and heard from [Marchionne], I think that this is much more of a true partnership than what Chrysler has had in the past.”
In late April, Marchionne confirmed his previous pronouncement that the Chrysler brand in North America and Fiat’s Lancia brand would likely share products, but added that Chrysler will be the brand for North America, while Lancia will gradually expand its product lineup in order to grow the brand in Europe.
Chrysler has been quiet in recent months, on this and other subjects. Indeed, a Chrysler spokesman declined to comment on the company’s product plans for the year ahead, or the Nassau, or even on Marchionne’s remarks.