Fiat Models To Power Chrysler Products

It probably won’t be much of a surprise to Chrysler followers, but come next Wednesday we’re going to learn just what sort of direction the beleaguered automaker will take when it announces its product plans going forward. With Fiat steering the ship, a number of new models based on Italian technology will underpin upcoming Chrysler and Dodge vehicles, particularly its cars.

Dodge Ram

The announcement is coming as some worry that Chrysler needs to move quickly as customers abandon the automaker in favor of competing brands such as Ford, Hyundai, Kia and Volkswagen. Chrysler has already said that for all intents and purposes its Dodge Ram line will be separated from other Dodge products which also means that the Dodge Grand Caravan and other Dodge models will go away. In their place will be a handful of new models resting on Fiat platforms.

Fiat has indicated that the Fiat 500 (pictured), its popular world car, will be sold through select Chrysler dealers beginning in 2011. The Italian automaker has also said that its Alfa Romeo line will be introduced to the US market, perhaps no later than 2012. Fiat owns a 20% stake in Chrysler, but the company has no plans to pour cash into the struggling automaker, just product lines.

UAW Ownership

Chrysler filed for bankruptcy late this past spring, emerging weeks later with most of its toxic assets left behind. With federal government assistance, Chrysler broke free from its previous parent, Cerberus Capital Management, LP and is now owned by the United Auto Workers (UAW), the US and Canadian federal governments and Fiat. The UAW owns the lion’s share of what is now legally called Chrysler Group, LLC at 55%. Over time, Fiat will eventually increase its ownership to 35% and, if successful, gain controlling interest over Chrysler.

A number of Dodge models will go away over the next few years including its midsize sedan, the Avenger, the Nitro SUV and the compact Caliber. Several Jeep models will be dropped including the bulky Commander, as well as the Compass and Patriot. Chrysler will say good-bye to the aged PT Cruiser and its midsize Sebring sedan. New models based on Fiat platforms will replace some of the vehicles being retired, but not all.

Fiat 500

Fiat plans to build its 500 model in Mexico beginning in 2011, importing that car to the United States. Several other Fiat derived model lines will be built at other factories in North America and sold as Chrysler, Jeep and Dodge vehicles. We’ll have to wait until the Chrysler Group makes its announcement next week to see the outline of those plans.

Chrysler Separates Dodge Car, Ram Truck Brands

It will either go down as a bold marketing move or it will be considered one of the dumbest moves made by an automaker since, well, 2008.

What am I talking about? That would be Chrysler Group LLC’s decision to separate its Dodge cars and trucks into two divisions – Ram trucks and Dodge cars. The former will be made up of trucks and sport/utility vehicles, the latter everything else. True, when it comes to Dodge most vehicles sold are trucks. And, each of those sport the ram logo.

Internal Change Initially

The change is likely to be mostly internal because all affected vehicles will continue sport Dodge branding. The difference is that Dodge Ram will represent the burly side of the house while Dodge Car will hold up the passenger vehicle side including the Challenger and the iconic Viper. Consumers won’t notice any difference at first, though that might change if Chrysler decides to award Dodge Ram only or Dodge Car only franchises eventually.

Come to think of it, this move might work in areas of the country where Dodge car sales are negligible while Dodge Ram sales are strong. Dealers wouldn’t be obligated to carry the Stratus, Caliber or other unrelated vehicle, choosing to outfit their showrooms with the many variations of the current Ram 1500 as well as the Dakota, Durango and whatever else Dodge plans to sell down the line. And for city showrooms where a Dodge truck might be out of place, stocking it with Challengers, Vipers, Chargers, Stratus models and the like could bolster those sales too.

New Executive Appointments

Related to these changes, Chrysler announced a number of executive appointments including making Chrysler 300C lead designer the head of Dodge Car operations. Fred Diaz, Jr. is now in charge of the Dodge Ram brand while Olivier Francois is head of the Chrysler brand.

Michael Manley remains in his position as head of the Jeep brand while Joseph Veltri will head up product planning. A pair of Chrysler executives have also left the company in pursue of other interests.

If the Dodge Ram, Dodge Car separation plan works, it could end up being just the juice the beleaguered automaker needs. With really no new products for 2010 and Fiat development still two years out, Chrysler needs to prop up what works in hopes of buying its some time. The Ram line is solid, one of the few bright lights in the Chrysler arsenal.