Chrysler Models for Next 2 Years Boost Dealers’ Faith

Chrysler Group LLC, the automaker controlled by Fiat SpA (F), provided dealers a preview of its model lineup for the next two years, increasing confidence that the automaker can continue market-share gains, dealers said.

Chief Executive Officer Sergio Marchionne and Chrysler’s seven brand chiefs presented models on Sept. 10 in Las Vegas intended to carry the automaker through 2014, including the Chrysler Town & Country and Dodge Grand Caravan, plus Alfa Romeo’s 4C sports car and Giulia sedan, said the dealers, who asked not to be identified because the meeting was private.

Vehicles with better fuel economy will strengthen Chrysler and close out the five-year plan Marchionne laid out in 2009, when the company had less than 9 percent of the U.S. auto market. Chrysler has boosted its share to 11.4 percent this year through August after introducing 16 new or refreshed models in the 19 months after it emerged from a U.S.-backed bankruptcy.

“There’s going to be more faith in whatever plan is put in front of them” compared with when Chrysler revealed its five- year plan, said Dave Sullivan, a product analyst at AutoPacific Inc. “You’re going to want to own a Chrysler because it has the technology or the style or the fuel economy that you’re looking for, and not just the monthly payment.”

Other products planned within two years include a new Chrysler 100 small car, a redesigned 200 sedan, and two new small Jeep sport-utility vehicles, one of which is the replacement for the outgoing Liberty. While Chrysler has examined whether to keep two minivans or go with one, it showed two this week, the dealers said.

Standing Ovation

The dealers interviewed praised the presentation for the broad scope of changes to Chrysler’s lineup, which included updates to existing products, expansion of model lines and improvements to fuel economy. The redesigned 200 received a standing ovation by the crowd of 6,000 attendees, the dealers said.

Dealers who attended account for more than 90 percent of Chrysler’s sales in the U.S., the Auburn Hills, Michigan-based company said Sept. 10 in a statement. The vehicles shown to dealers “represent our firepower for the years to come,” Marchionne said in the statement.

Rick Deneau, a company spokesman, declined to comment about what models were shown to dealers.

Marchionne, who is also CEO of Turin, Italy-based Fiat, has said Chrysler is deciding whether it still needs two entries for the U.S. minivan market, which the company has led for almost three decades. Then-CEO Lee Iacocca introduced the Dodge Caravan four years after Chrysler’s 1979 government bailout.

Minivan Comeback

Minivans are mounting a comeback this year after shrinking to 472,398 U.S. sales last year from 1.37 million in 2000, the segment’s peak year. Minivan deliveries, dominated by Chrysler, Toyota Motor Corp. (7203) and Honda Motor Co., climbed 19 percent this year through August to 370,647, according to researcher Autodata Corp.

Dealers said it wasn’t made clear at the presentation whether the company will still have two minivan models in 2014.

Alfa Romeo’s Giulia sedan will be based on the same platform as the Dodge Dart compact car that began selling in the U.S. this year. Fiat was issued a trademark for the 4C name with the U.S. Patent and Trademark Office in April, according to a release posted on the U.S. Federal News Service.

Alfa’s Return

The timing for Alfa Romeo’s return is in part dependent on Chrysler and its dealers completing the process of filing letters of intent to become sellers of the brand, and may be completed by early 2014, according to one of the dealers.

“They’re going to have to rebuild the Alfa brand here and essentially start from scratch again,” Sullivan, the analyst for Tustin, California-based AutoPacific, said in a telephone interview. “Even if they were to have cars tomorrow, it doesn’t mean the brand is going to be successful in days, or a month, or in six months. There are a lot of other things that have to happen in order to make the brand successful.”

The redesigned 200 will be offered with a nine-speed transmission, the dealers said. The transmissions are scheduled to begin production by the first half of 2013, Mircea Gradu, vice president of transmission powertrain and driveline engineering, said in July. They are usable in “essentially any” front-wheel drive platform in Chrysler’s lineup, including the minivans, he said.

Minivan Sales

Minivans represent a significant portion of Chrysler’s sales. The Town & Country and Grand Caravan accounted for 15 percent of the automaker’s 1.37 million deliveries in the U.S. last year, according to Woodcliff Lake, New Jersey-based Autodata.

Chrysler sold a combined 172,001 Town & Country and Grand Caravan minivans this year through August, a 25 percent increase from a year earlier, according to Autodata. The gain trails the 29 percent sales rise by Honda’s Odyssey while topping the 5.5 percent increase by Toyota’s Sienna.

“We are less than two years away from having an almost completely rejuvenated product lineup compared to what we could offer customers when we began this journey in June 2009,” Marchionne said in video highlights of his speech to dealers.

To contact the reporter on this story: Craig Trudell in Southfield, Michigan at ctrudell1@bloomberg.net

To contact the editor responsible for this story: Jamie Butters at jbutters@bloomberg.net

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