Monday, March 21, 2011

Crunch time for Chrysler-Fiat partnership

Visitors of this week 2011 Geneva Motor Show will be their first look at the new theme, the long replacement for the Lancia expected brand flagship sedan ever.

The look is bold and elegant, but it is something about it that fit not in with the rest of the lineup for Fiat long struggling mid-luxury brand. This is not surprising, because the topic minus the Lancia badge, also made his debut in the United States as the new Chrysler 300.

Of this year's Geneva Motor Show highlights that dramatic global restructuring, the Chrysler and Fiat are companies as they begin their operations the mixture with jointly developed products under both their various brand names sold. It is a decisive step for both decision makers, but if either it is wrong it could pass on Chrysler and Fiat are forgotten.

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After Chrysler Fiat built protection from Chapter 11 in the June 2010 under the supervision of Italian automaker - the only car maker, appeared interested in saving the Detroit manufacturer - his future appeared uncertain.

In fact, rather than model year go conventional wisdom in the 2011, that Chrysler had little in the way of new product to brag about. However, praise was the car manufacturer for the new version of the 300 sedan, which will reach showrooms in the coming weeks, and has received 200 sedan unexpectedly positive reviews.

Then is being still the Fiat 500, the Microcar Chrysler parent short Italian in the United States in Europe as "Cinquecento", to start the car will be one of the smallest in U.S. highways and a clear alternative to the large LKWSUVs and crossovers Chrysler is known for.

Speech at the Geneva Motor Show, Sergio Marchionne, who serves as CEO for Chrysler and Fiat, proposed that the new Chrysler 300 sedan "combines the best of both worlds", and call on both sides of the Atlantic to car buyers could.

Marchionne hopes that the same applies to a number of other new products.

In Geneva, the Fiat stands have been with Chrysler filled products, wear soon European badges, such as the new Fiat Freemont, a renamed version of vehicle crossover Dodge journey. The Lancia stand, featured in the meantime the journey, a version of the Chrysler Town & country van, and the Flavia, a concept vehicle Chrysler's new 200.

More models come including a Maserati sport utility vehicle based on the 2011 Jeep Grand Cherokee.

This is a big change from the approach that the Chrysler two decades ago took when it together with the Italian luxury automobile manufacturer Maserati TC by Maserati, to develop a bad review luxury sports car that was quickly pulled from the market.

Chrysler and his new transatlantic partner Fiat must hope that the new global offers of this time be better stressed automotive analyst Joe Phillippi of car WebTrends consulting.

"Without a doubt," If the strategy works he warned, it is raised serious questions about the future of Fiat and Chrysler.

Fiat "White Knight" for Chrysler in bankruptcy in the U.S. automaker emerged as that in the year 2009 plunged. The Government agreed to give a 20-percent stake in Chrysler as part of a multi billion dollar bailout to the Italian automaker. Fiat was also a number of objectives to meet, which finally was able to increase its stake to 35 percent. These tasks include Chrysler's corporate average fuel economy to improve and increase the sales in other countries, where it is long behind competitors Detroit.

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But there are other potential payout for Fiat. Marchionne is convinced, heated up as global competition, mainstream manufacturers need to sell each year to reach at least three million vehicles to the necessary economies of scale. In fact, car hit during the recent Detroit show, Marchionne he "might have to revise this figure" something closer to five million.

To get there, however, Marchionne takes its lead from competitors such as Toyota, Honda and Ford.

Japanese automakers concentrated have can be sold so far always on the development of global products that reflect in a variety of markets around the world with only minimal changes to local taste and regulations.

Ford has adopted this strategy with products like the new alignment, the 80 percent of its components between the American and European markets is parts.

At first glance, the same strategy with the Freemont, topic and Voyager models follows Chrysler. There are subtle differences, such as the European regulatory authorities, the prescribed side-marker lamps and more in particular offered on the Lancia theme designed to the requirements of the fuel-conscious drivers offer a range of engines, such as for example the 3.0-liter turbo-diesel.

Ultimately, the strategy works for both automakers. Chrysler and Fiat of product development teams are already working on a range of projects, which will bring the American carmaker line-up, including Fiat-based replacement for the 200 sedan European products.

The Italian automaker again more recently own distribution network in the States, choose this way to sell the distinctive Fiat 500 Microcar. But in the future that appears jointly developed products in the United States most Chrysler or Dodge - and possibly Jeep badge.

The time of the start could prove critical, if the current run-up of in fuel prices further. No Detroit automaker is more dependent on the sale of fuel hungry truck as a Chrysler. With federal mileage standards of 35.5 mpg by 2016 in direction - and possibly 62 mpg 2025 - analyst Phillippi said that a number of smaller products, which probably could afford it on its own, need long troubled US car makers to develop.

Fiat, must now to expand its offer in other markets.

The topic, such as Lancia's flagship sedan, was originally a joint venture with Fiat developed partners, including Saab as. However the model of the production has been since 1994, and Fiat was not their act together on its own replacement.

Accepted European American vehicles what whatever badge they wear? Initial reviews of what some have called "Chrysliats" and "Lanchlers" mix. It takes some aggressive marketing strategy work, warn European observers.

Fiat will be hard to convince American consumers to buy their products will press. The automaker of advertising budget, estimated at $1.72 is billion last year to $2.9 billion in 2011, according to the Detroit News will be increased.

"they have damn a lot of work" ahead, notes analyst Phillippi, adding that it, skeptical requires branding buyers for Fiat and Chrysler, that new global offers buy to convince.

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