Chrysler-Fiat’s lengthy to-do list CEO Mar­chionne should make some moves

Winnipeg Free Press - Section E - - AUTO INDUSTRY - By Mark Phe­lan

NOW that Chrysler and Fiat are fully merged, they should be able to move much faster with new­model de­vel­op­ment, in­vest­ment and more.

That’s fine; but re­mem­ber, Daim­lerChrysler looked good on pa­per, too.

The proof’s in the do­ing. Here are some things I’m watch­ing for as CEO Ser­gio Mar­chionne builds this new global au­tomaker: More new ve­hi­cles, faster New ve­hi­cle in­tro­duc­tions have slowed to a trickle at Chrysler and Fiat. The Euro­pean mar­ket is such a mess, Fiat halted the de­vel­op­ment of ve­hi­cle ar­chi­tec­tures and driv­e­trains Chrysler and its South Amer­i­can and Asian units need. With Europe fi­nally show­ing signs of re­cov­ery from the Great Re­ces­sion, it’s time to put the ham­mer down.

“The full com­bi­na­tion of Fiat and Chrysler is likely to open up the prod­uct pipe­line in terms of speed­ing ve­hi­cles to the show­room and of­fer­ing shop­pers a greater di­ver­sity of choices,” said Bill Vis­nic, se­nior an­a­lyst with Ed­munds. com. “As a fully in­te­grated com­pany, Fiat and Chrysler can do more to­gether faster.”

Till now, Chrysler has fallen short of the am­bi­tious plan for new mod­els based on Fiat ve­hi­cle ar­chi­tec­tures.

“An in­com­plete merger throws a span­ner in the works from a prod­uct plan­ner’s point of view,” said Eric No­ble, pres­i­dent of the Car­lab, a prod­uct-de­vel­op­ment con­sul­tancy. Fol­low the money For­get para­noid talk about “Chrysler money go­ing to Fiat.” It’s all one pot of money, but a good man­age­ment team will in­vest it where the re­turn is high­est. That means prod­uct de­vel­op­ment for ve­hi­cles that can be sold around the world. Re­pair­ing Fiat’s strug­gling Ital­ian op­er­a­tions at the ex­pense of mon­ey­mak­ers such as North and South Amer­ica, China and Rus­sia is a bad idea.

“It’s now one com­pany. One cash sup­ply,” said IHS Au­to­mo­tive an­a­lyst Stephanie Brin­ley. “The money should go where it’s needed for long-term strate­gic pur­poses.” Fix the brands The Chrysler brand’s lineup is shock­ingly thin — the 300 and 200 sedans and Town & Coun­try mini­van. Brand boss Al Gard­ner ac­knowl­edges it needs more, but what mod­els? A cross­over? A com­pact? A con­vert­ible? Chrysler prob­a­bly needs all those and more, and soon.

Alfa Romeo is an­other weak­ness. It’s past time to ei­ther make Alfa work or eighty-six the trou­bled brand. I’ve lost count of how many Alfa re­boots Fiat man­age­ment has de­manded and dis­missed while the brand’s sales and rel­e­vance dwin­dle.

Alfa has a glo­ri­ous his­tory, but if this May’s new-prod­uct plan isn’t rock-solid, Ser­gio should sell Alfa to brand-hun­gry Volkswagen for a king’s ran­som. Then in­vest the money in Maserati, a lux­ury brand that has a present and a fu­ture as well as a past. Tech­ni­cal, de­sign lead­er­ship Chrysler has bat­ted .500 with its Fi­at­based ve­hi­cles so far. The Dodge Dart is a good car, but noth­ing about its de­sign, fea­tures or fuel econ­omy pro­pelled it to the top of buy­ers’ lists. The Jeep Chero­kee looks like a clear-cut win­ner, com­bin­ing clas­sic Jeep ca­pa­bil­ity with eye-catch­ing looks, new tech­nol­ogy and good fuel econ­omy.

Chrysler needs more hits like the Chero­kee. It can’t af­ford to be “as good as” the com­pe­ti­tion. There’s no room in Chrysler deal­er­ships for ve­hi­cles with me-too styling, unex­cep­tional fuel econ­omy or fea­tures.

The chal­lenge is nei­ther Fiat nor Chrysler has con­sis­tently been a leader in com­pact and mid-size cars. That

must change. The 200 is the next test. So far, so good, Ser­gio The Daim­lerChrysler dis­as­ter left us all un­der­stand­ably gun-shy about for­eign own­ers at Chrysler, but Ser­gio Mar­chionne isn’t Juer­gen Schrempp. Fiat has al­ready co-op­er­ated more fully and ea­gerly with Chrysler than Mercedes-Benz ever did.

“It’s time to have a lit­tle trust based on how Mar­chionne’s per­formed so far,” Brin­ley said. “He’s proven to be a good leader.”

Mar­chionne has been a fine stew­ard of Chrysler’s in­ter­ests. Chrysler got ac- cess to Fiat’s best tech­nol­ogy, but also had the free­dom to seek in­no­va­tions from sup­pli­ers Fiat doesn’t use, such as Amer­i­can Axle Man­u­fac­tur­ing, in­ven­tor of the Chero­kee and 200’s fu­el­sav­ing all-wheel drive sys­tem.

“Chrysler’s on the right track,” said Drew Winter, ed­i­tor in chief of the Ward’s Auto World web magazine. “It’s in a bet­ter place for the fu­ture than it’s been for decades.”

U.S. Vice-Pres­i­dent Joe Bi­den in a Chrysler prod­uct, lis­tens to Chrysler-Fiat CEO Ser­gio Mar­chionne at the Detroit auto show.

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