What Will Fiat and Chrysler Be in 2019?

Sergio Marchionne manages eight brands -- more than exist at General Motors or any other carmaker except the Volkswagen Group monolith. The Fiat Chrysler president and CEO told Wall Street analysts the notion of running VW Group would “scare the bejesus” out of him. While he previously said he only wanted his “fair share” of the premium market, Marchionne’s Investor Day five-year plan sounds far more aggressive than that, going after the German automakers, especially with Alfa Romeo and Jeep.

The Alfisti will be disappointed with the lack of detail and progress with the new rear-wheel-drive strategy. Much of the first half of Maserati-Alfa chief Harald Wester’s presentation to the investment analysts consisted of educating them on the brand’s racing history. After the Alfa 4C arrives this year, the next model is a BMW 5-series sized car, Wester said, but it won’t be ready until the fourth quarter of 2015. After that, two compacts, a full-size car, and two utility vehicles, plus a replacement for the 4C listed as a “specialty” model, are vaguely grouped into the calendar 2016-2018 time frame. Wester also announced that Fiat Chrysler has established a “skunk works” (yes, Lockheed Martin has a trademark on that name) to develop these cars and their flexible RWD platform, led by two unnamed, high-ranking Ferrari managers.

All Maseratis and Alfas will be assembled in Italy to soak up excess plant capacity. Alfa attributes, Wester said, will be best-in-class rear- and all-wheel-drive global architecture and “unique” diesel and gas powertrain technology.

(Standing in for Luca di Montezemelo, Marchionne said Ferrari is willingly limiting production to 7000 cars per year, will introduce a new model every year, and is worth “in excess of 1 billion euro.” It is not, he said, for sale.)

Fiat will be split into “upper mainstream” and “lower mainstream” models, with the latter mostly going to the Asia-Pacific and Latin American markets. Brand chief Olivier Francois said North America will get the “upper mainstream” cars, making the 500 models a sort of sub-brand. The Fiat 500x comes to the U.S. early next year, followed by the Mazda Miata-based two-seat sports car, probably as a Fiat Abarth, in late 2015. We’ll get no other new Fiat models through the rest of the Five-Year Plan, which makes profit margin relief in the form of new Alfas very important to Fiat dealers. Marchionne repeated that “select” Maserati and Fiat dealers will sell Alfas in the United States.

Rather than the Ram pickup, the next Jeep Wrangler, scheduled for 2017, may get aluminum-intensive construction.

“My instincts are that we won’t” build an aluminum pickup, Marchionne said. “We can make better use of aluminum elsewhere.”

Jeep launches its Grand Wagoneer three-row SUV in late ’18, president and CEO Michael Manley said, and Marchionne claimed it will be luxurious enough to compete with the Range Rover (so it’s another candidate for aluminum construction). A new C-segment model replaces both Compass and Patriot in mid-2016, which confuses me. I thought the new Cherokee was Jeep’s compact CUV entry. Are heavy Jeep profits prompting Fiat Chrysler to overload its product portfolio?

As expected, Dodge becomes a “performance” brand, as much through styling and image as through powerful engines and tight chassis, I suspect. For example, brand chief Tim Kuniskis said there are SRT and non-SRT versions of the Dart and the Journey replacement coming in mid-’16.

The SRTs will have AWD and a “high-output” turbo engine, although the non-SRT Dart will compete with the new Chrysler 100 compact. There’s a new Durango in 2017 and all-new Challengers and Chargers, with or without Hellcat supercharged SRT V-8 packages, slated for mid-’18 as ’19 models. There’s also a new B-segment sedan and hatchback, sans SRT, scheduled for early ’18.

Chrysler becomes “mainstream,” president and CEO Al Gardner said. Gardner quoted Walter P. Chrysler upon the launch of his company in 1925 as saying, “I gave the public quality, beauty, speed, comfort, style, and power, all at a low price,” though this was before Walter P. propped up his eponymous brand to Buick prestige levels by adding Plymouth, Dodge, and DeSoto to his lineup.

I understand how the old Chrysler 200, energized by the best commercial broadcast during Super Bowl XLV, has finally become a volume player in the mid-size segment, with no Dodge counterpart to split sales. Will the mid-size crossover added in 2018 be a variation of the Journey replacement? A new Town & Country and a 75-mpg plug-in hybrid version come in 2016, followed by a full-size CUV and its PHEV version the following year. They’ll share a new big FWD/AWD platform. The bad news is that an all-new Chrysler 300/300C due in 2018 will probably be on that platform.

“The architecture choices we make for Dodge are going to be fundamentally different than the ones we make for Chrysler,” Marchionne said.

The big new Dodges coming in late ’18 “may” get the new RWD Alfa platform, while the big Chrysler most certainly will not, he said. This is a mistake. The RWD platform, old as it is, has set the Chrysler 300 apart from the Toyota Avalon, Buick LaCrosse, Acura TL, Chevy Impala, and the like. The 300’s dynamics and its proportions lend an air of “beauty, speed, comfort, style, and power” while propping up the image of such cars as the new 200, even if the 200 is priced directly against the Ford Fusion. Gardner and Kuniskis have said repeatedly that the 300 and the Charger sell to quite different customers. So why not keep the Chrysler 300 rear-wheel drive?

To be fair, managing all these brands is a balancing act. Jeep is bringing in the bulk of gross profits, while the automaker’s other global brand, Alfa Romeo, can’t seem to get started. This Fiat Chrysler five-year plan looks much more realistic than the one the company presented in 2009, which was overloaded with ambitious product overlap. I hope Marchionne and company can make the right adjustments to this plan before it’s time to start working on the next five-year plan.

auto.motive
Setting unrealistic goals will undermine the performance of every team within Fiat.   It will cause utter failure as the teams struggle to continually battle monthly and quarterly goal requirements.   Duplication of models for Dodge and Chrysler will be costly and eventually discounts will hurt the bottom line.   New leadership requires a different business model taking Fiat to build better quality vehicles worldwide and adding models to Fiats lineup in the US since the 500 is now the lone wolf and will suffer like the current Mini Cooper.    If Fiat is to succeed in the US the Alpha Romeo  4C should be one of their new entries.  This would give Fiat a halo car and definitely increase foot traffic which they need now. 
Sideways the Seven
VEEEEERY ambitious plans. I can't say I'm all that positive that it will work!

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