Chrysler says it will meet new CAFE standards

Detroit's sharp intake of breath over the very real possibility of increased federal fuel economy standards apparently doesn't include Chrysler's voice. CEO Robert Nardelli has told The Car Connection that rather than waste lots of time and energy opposing the likely increase to a 35 mpg fleet average, Chrysler will put its head down and get it done. Attaining the goal will not be without pain, however. Cuts will be made, and the books are still in the red.

There is hope, though, if Chrysler and parent Cerberus Capital can stick it out. A new contract with the UAW eases some of the automaker's financial burden, allowing that money to be plowed into development of more fuel efficient vehicles. There's a new two-mode hybrid system, co-developed with Daimler, GM, and BMW, which should help lift the fleet average without Chrysler abandoning their bread and butter moneymakers. With a lineup heavy in less-frugal vehicles like SUVs, trucks, and minivans, Chrysler's acknowledged the holes in their product mix and will set about plugging product into the voids. First up is the new Journey, the company's first crossover vehicle. The CUV segment is red-hot right now, so having a model to sell is a plus. Having a good model that will continue to sell well is an even bigger plus. At this point, Chrysler's facing an uphill climb.

[Source: TCC]