400 Chrysler Dealers Attend Fiat Lovefest

Fiat 500 debut set for December 2010

Fiat loves Chrysler dealers. Or at least they want to love those who can help set up shop for the Fiat brand in 165 markets.

On Monday, Chrysler Group LLC played host to 400 dealers who were on hand in Auburn Hills, Michigan, to find out what it will take to join the Fiat dealer network, getting more information about the Fiat brand and history, future product plans, competition, volume expectations and related matters.

Selected dealers will continue to sell Chrysler products, but they’ll also be given the opportunity to sell Fiats beginning with the subcompact Fiat 500 later this year.

Information Packet

Dealers learned what Fiat needs in order to consider their shops and were given information packets to review. Those dealers interested in carrying Fiat will have until September 22, 2010, to present their information to Fiat North America. Selected dealers will be announced in October with the first models arriving in December.

“The Fiat brand offers our dealers the opportunity to be part of a unique experience,” said Laura Soave, Head of Fiat Brand North America. “Our dealers will be able to interact with a group of individuals that are not part of their current customer base. These are individuals interested in Italian automotive design coupled with fuel efficient technology. Our dealers will be the key point of contact with our customers, and thereby, a crucial part of the success of the Fiat brand.”

North American Manufacturing

Despite its Italian pedigree, the Fiat 500 sold in the United States will have a distinct North American flavor to it. The car will be built in Toluca, Mexico, and the 1.4-liter engine is being built in the United States. That engine features MultiAir technology, something that will provide a 10 percent boost in power while offering a corresponding increase in fuel mileage and decrease in emissions.

Auto Trends will provide additional dealer information and a review of the Fiat 500 over the coming months.

Source: Chrysler Group, LLC

Fiat, Volkswagen & the Alfa Romeo Complexity

Fiat s.P.a. is busy tending its American offspring, attempting to ensure that its Chrysler, Jeep, Dodge and Ram brands have a secure footing going forward. That’s a tall order given the financial problems and its dearth of new products in recent years.

Sergio Marchionne, the workaholic brainchild and CEO behind Fiat and Chrysler has managed to gain hold of Chrysler without spending a single Italian lira, a feat made easier when the feds threatened Chrysler with extinction. But, Marchionne has several Italian brands to maintain including niche supercar brands Ferrari and Maserati, Lancia, Alfa Romeo and its namesake, Fiat.

We now know that General Motors had trouble maintaining eight domestic brands, tossing four in a bid to survive. Nine brands can be very difficult to maintain although Fiat’s plans seem to include matching Alfa Romeo to Chrysler and allowing Jeep and Dodge to tap Fiat for platforms and powertrains.

In recent days rumors of ten-brand Volkswagen Group interest in acquiring Alfa Romeo have surfaced with speculation being that VW wants the Italian brand to help it seize the No. 1 global automaker status from Toyota. In recent years as General Motors and Toyota have traded places as 1-2 automakers, Volkswagen sales have surged to where it is now a close third.

At present, Alfa Romeo produces just over 100,000 cars annually. That’s small potatoes, but Marchionne has said that he plans to increase that number five-fold within the next four years. Another tall order, but one he may be able to pull off if he reintroduces the brand to the U.S. market to sell alongside Fiat at select Chrysler Group dealerships.

Analysts are casting doubt that Fiat will be able to propel Alfa Romeo, but these same folks are saying that Volkswagen may be able to reach Marchionne’s goal and on time. Fiat isn’t awash in cash, while Volkswagen has money and plenty of it to burn.

Marchionne’s misgivings show that he is concerned what it would mean if Alfa Romeo left the Fiat Group fold. Chrysler would suddenly not have product available and would have to tap the Fiat brand for some of its models. Supposedly, Chrysler and Alfa Romeo are well down the road to sharing platforms and powertrains, an initiative threatened if VW acquires Alfa Romeo.

Here’s my solution: Fiat should sell Alfa Romeo to Volkswagen, but retain the right to sell the brand stateside as the exclusive distributor. In addition, Alfa Romeo and Chrysler would continue to collaborate on select products, while Volkswagen would tap Chrysler for its next generation Routan and perhaps gain access to some other models.

Does this sound far-fetched? Five years ago, maybe. But, today automakers are working together on various projects in a bid to cut costs and save their own necks. Fiat would get much needed cash, Chrysler would receive new product while Volkswagen would get a shot at automaker immortality by acquiring Alfa Romeo.

Across much of Europe and in some other markets Volkswagen and Fiat are fierce rivals, but that rivalry could be set aside just enough to allow Alfa Romeo to make a clean transfer to the German automaker.

Auto Trends We’re Following

What’s in the news?

The summer months are supposed to be fairly quiet when it comes to developing auto industry news stories, but there is enough happening this summer to keep everyone’s eyes focused.

This time last year the federal CARS or “cash for clunkers” program was heating up, introduced on July 24 and offering an artificial surge in car sales. In 2009, billions of dollars of taxpayer monies were being directed to an industry already benefiting from tens of billions of dollars in bail out bucks and other relief. What good the program did is a matter of debate, but know this: there is no desire on the part of most politicians to bring it back.

Here are some of the auto trends we’re currently following:

• The 2011 Cadillac CTS Coupe is in production and the first cars have left the factory floor and are enroute to Cadillac dealerships. This model will expand the CTS portfolio which now includes a sedan, sport wagon, the coupe and V-Series versions of the sedan and soon the wagon and coupe.

• Toyota knew about engine problems with its Lexus models as far back as 2007, but didn’t issue a recall until July 1 this year.  Automotive News reports that the first customer complaints for affected Lexus models dates to March 2007, when Japanese customers complained about defective valve springs.

• Not much has been said about Ford’s sale of Volvo to Geely in recent months, but that is beginning to change. The Wall Street Journal shared a statement from the EU’s antitrust body which said, “The Commission concluded that the transaction wouldn’t significantly impede effective competition.” Expect that Ford to conclude the deal sometime this summer.

• How will Chrysler handle the sale of the Fiat brand in America? That is a good question, one that has remained unanswered even as the Fiat 500 is being prepared for its stateside debut later this year. The Kenosha News reports that Chrysler dealers are receiving packets outlining what is required of them to be considered for Fiat dealerships. Chrysler, 20 percent owned by Fiat, will be establishing 200 dealerships in hopes of selling 50,000 Fiats annually.

• Will the Detroit 3 survive? Some people are still asking that question although Ford’s position is by far the brightest of all three. GM appears to have stabilized and even Chrysler is enjoying a boost thanks to its recently released 2011 Jeep Grand Cherokee.  The Detroit Free Press says that all three automakers appear to be able to ride out the current economic storm.

That’s it for today…new stories shared as we discover them!