Fiat SpA (F)’s Jeep and Chrysler brands are both aiming to more than double their sales by 2018, while the Dodge brand will stop making the Grand Caravan minivan, executives said today.
The targets were revealed in a presentation to investors today at Chrysler Group LLC headquarters in Auburn Hills, Michigan. Fiat took full ownership of Chrysler in January as part of Chief Executive Officer Sergio Marchionne’s decade-long effort to turn the Turin, Italy-based carmaker into a bona fide challenger to Volkswagen AG and General Motors Co.
Jeep is a big part of that plan. The brand is on track to reach 1 million sales this year, Mike Manley, Jeep CEO, said today. By 2018, the company aims to make Jeeps at 10 factories in six countries and increase the number of dealers to 6,023 from 4,706, with those in Asia more than tripling to 1,270. Sales in Latin America should increase 50 percent annually to 2018, the company said.
“This fully opens up key markets around the world that we’ve been constrained in,” Manley said of the expansion plans.
Fiat fell as much as 15 cents, or 1.8 percent, to 8.42 euros and was down 1.6 percent as of 4:09 p.m. in Milan trading. The stock has surged 42 percent this year, valuing the Italian manufacturer at about 10.6 billion euros.
Marchionne, 61, targets completing the combination of the Italian and U.S. carmakers by the end of 2014, he said in March. The new entity, named Fiat Chrysler Automobiles NV, will have its main stock listing in New York while it will be registered in the Netherlands with a fiscal domicile in the U.K. for tax purposes.
Fiat started accumulating Chrysler Group stock in 2009 as part of a rescue of the U.S. carmaker following its bankruptcy in the global recession. Without the division, Fiat would have been unprofitable in 2012 and 2013 because of losses in Europe.
The Chrysler brand, positioned as a mainstream, non-premium make, aims to more than double sales to 800,000 in 2018, the company said. A compact car called the 100 will be introduced in 2016 and the brand will add two plug-in electric vehicles by the following year. The full-size 300 sedan will be refreshed this year and replaced in 2018, said Al Gardner, the brand CEO. Chrysler will also add a mid-size crossover-utility vehicle in 2018, he said.
Production of the Dodge Grand Caravan will end in 2016, so the Chrysler Town & Country minivan will no longer face competition in dealerships that carry both brands, Gardner said. The Chrysler van’s sales rose 9.4 percent last year to 122,288, while deliveries of the lower-priced Dodge slid 12 percent to 124,019. Chrysler will replace its minivan in 2016, adding a plug-in hybrid version, Gardner said, and the brand will add an SUV in 2017, which will also be offered as a plug-in hybrid.
Separately, the company said the SRT family of performance vehicles are now consolidated under the Dodge brand, which is led by Tim Kuniskis, who is also head of fleet operations. Ralph Gilles remains senior vice president of product design and CEO of motorsports.
Fiat brand sales are forecast to increase 27 percent to 1.9 million in 2018 from 1.5 million in 2013. In Europe, Fiat will add eight models to maintain sales at 700,000, the company said. The brand’s sales are seen rising by 2018 to 100,000 in North America and 300,000 in Asia. Fiat will add a 500X small SUV in North America in 2015, the company said.