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Chrysler plans three new Dodge vehicles, considers pickup
Chrysler Group LLC plans to introduce three new Dodge vehicles and is considering building a midsize pickup truck as it looks to rejuvenate its product portfolio and attract customers, The Wall Street Journal reports. The details are the first to emerge from Wednesday's five-year business-plan meeting at Chrysler's headquarters in Auburn Hills, Mich. Chief executive Sergio Marchionne intends to spell out how Chrysler will drive sales under his leadership. Marchionne, chief executive of Fiat SpA, took over Chrysler in June after the company filed for bankruptcy protection. "All expectations both internally and externally will be met," Marchionne said before the start of the six-hour press conference Wednesday. More than 300 people are attending the event. Chrysler Chairman C. Robert Kidder said there is no more "business as usual." "After five months and several board meetings, the board's confidence that Chrysler will re-emerge as a strong competitor" is stronger than ever, Kidder said.The Dodge cars will include an all-new compact model along with a subcompact hatchback and a midsize sedan. These cars will be introduced in 2012 and 2013.

Streamlined Chrysler vehicle logo cleared for takeoff

On the eve of Chrysler Group LLC's post-bankruptcy debut, the U.S. Patent Office approved a new streamlined logo that compresses the winged symbol that Chrysler vehicles have used since the mid-1990s, the Detroit Free Press reports. Instead of the Chrysler lettering running above the wings, the new logo has the Chrysler name imprinted in the middle of the wings. The design is a bit reminiscent of the old Ford Thunderbird logo and not much different from Aston Martin's trademark. Photo credit: Chrysler

Chrysler to Sell 4 Fiat 500 Models in U.S., CEO Says (Update1)

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By Mike Ramsey and Sara Gay Forden

July 2 (Bloomberg) -- Chrysler Group LLC, the U.S. automaker run by Fiat SpA, will sell four models of the Italian carmaker's 500 subcompact in the U.S., Chief Executive Officer Sergio Marchionne said.

Chrysler, which emerged from bankruptcy on June 10, will eventually sell a convertible, wagon and sporty version called the "Abarth" in addition to the four-seat subcompact in the U.S., Marchionne said in an interview on June 30. While the base 500 will go on sale next year, he didn't say when the other models will be available.

"All of those cars will be coming to the U.S.," Marchionne said. "Fiat will be known in the U.S. purely in terms of its 500 car."

Fiat, based in Turin, Italy, owns 20 percent of Chrysler Group, and is sharing vehicles and technology with the U.S. car company in exchange for ownership. Fiat said it sold 190,000 of the small cars, which are about the same size as Bayerische Motoren Werke AG's Mini.

In Europe, the Fiat small car can be equipped with a 1.2- liter or 1.4-liter four-cylinder engine or a 1.3-liter turbo diesel. The 1.4-liter engine variant gets a combined, city- highway average of 36 miles per gallon under European regulatory standards.

"Its biggest impact will be to spark interest in bringing people back into the dealerships," Aaron Bragman, a Troy, Michigan-based analyst with IHS Global Insight Inc., said in an interview. "Given the fact that it is an unusual car and quirky and cute, it is a good car for them."

Chrysler's most efficient model today is the Dodge Caliber, which gets 24 to 30 miles per gallon.

Chrysler, based in Auburn Hills, Michigan, filed for bankruptcy on April 30 because of plunging car sales.

To contact the reporters on this story: Mike Ramsey in Southfield, Michigan, at mramsey6@bloomberg.net; Sara Gay Forden in Milan at sforden@bloomberg.net.

Last Updated: July 2, 2009 14:19 EDT

Chrysler's Marchionne Says Automaker Will Keep Lean Inventory

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By Doron Levin and Sara Gay Forden

July 1 (Bloomberg) -- Chrysler Group LLC plans to build cars in proportion to consumer demand instead of producing as many vehicles as possible and pressuring dealers to buy, Chief Executive Officer Sergio Marchionne said.

The automaker, which emerged from bankruptcy on June 10, intends to avoid overproduction, maintain tight dealer vehicle inventory and encourage consumers to order cars as well as buy on the spot. Chrysler's plan mimics so-called lean manufacturing principles pioneered by Toyota Motor Corp. in the Japan-based company's rise to the world's biggest automaker.

"You can't keep shoving cars down people's throats," said Marchionne, who is also CEO of Fiat SpA's automotive unit, in an interview in New York. "You don't park as much iron on the dealers' lots, you make products of sufficient quality that people will wait a day to get them."

Marchionne's statements represent a glimpse of a new manufacturing strategy at Chrysler, which reorganized around what it considers the best assets and $6 billion in financing. Fiat, based in Turin, Italy, bought 20 percent of the new Chrysler formed from the bankruptcy.

A departure from Auburn Hills, Michigan-based Chrysler's practice of building large vehicle inventory, which led to discounting and financial losses, is designed to help achieve financial stability when U.S. auto demand rebounds.

AutoNation Inc., the largest publicly traded U.S. automotive retailer, criticized the manufacturing practices of Detroit automakers in an interview last week because they "undermine the residual value of vehicles and alienate consumers," said CEO Mike Jackson.

'High Fixed Costs'

"Domestic automakers have had very high fixed costs, so when they have a decision to make they'll always make more vehicles," Jackson said. "The automakers recognize revenue on sale to the dealer. Then dealers and manufacturers have to resort to extreme incentives to liquidate inventories."

Cash rebates, low-interest loans and other incentives push vehicle resale values down, Jackson said.

"Then you lose market share as customers flee to other brands that have better resale value, and the whole overproduction process starts again," he said. AutoNation, based in Fort Lauderdale, Florida, owns 11 Chrysler franchises among its 289 U.S. vehicle outlets.

U.S. automakers such as General Motors Corp., Chrysler and Ford Motor Co. historically built vehicles with the goal of keeping a two-month supply on dealer lots. Toyota and Honda Motor Co. have tried to maintain inventory as little as half that size.

To contact the reporter on this story: Doron Levin in Southfield, Michigan, at dlevin5@bloomberg.net

Last Updated: July 1, 2009 11:54 EDT

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