Chrysler throws in towel on 200 (and Dart)

[mcrews]

Im sorry to say, none of you seem to understand business.
Item A: is small and entry level. Parts have to be specially engineered and not out of the stock bin. Price point cant exceed $x.xx (let'd say 27k). Limited profit per item. Limited buyers
(btw, that's why the first gen small cars failed in the 70's. The couldn't afford to re-engineer so they were small cars built like big cars.)


Item B: big and entry level to top of line. Wide range of options. Parts are normal size and can be swapped across the tool bin. Price point can exceed $XX.XX (let's say $60k) wide range of buyers.

So, in review, I'm I company and accountable to myself, my Stockholders, my employees and finally my customers.
A. in the back of my mind I have to remember that there is a FIXED cost per vehicle of wages and union benefits (driving my price point).
B. it's easier to commonly share internal parts that are a common size.
C. Trucks make up 1/2 (yes HALF) of all vehicles sold.
D. trucks have the largest profit margin outside of luxury brands top models.

I (as a company) don't care about whiney people who NEVER bought my new eco-cars when I made them. I care about staying in business and building what sells.

You can all the emotional and illogical comments you want.
But at the end of the day, BUSINESS is BUSINESS.

[Daox]

I understand all that. I also understand that a lot of other companies have found ways to do it fairly successfully. This is why Chrysler pretty much sucks at business and thus why they've basically gone under and have been sold numerous times in the past decade and a half.

Having no small cars will yet again put them behind the pack as gas prices do go back up. The current prices are unsustainable as we all know (and even the Saudi's have admitted to).

[MetroMPG]

I do not doubt this is a sound business decision for the short term.

[sendler]

Not blaming Fiat/ Chrysler. Just a sad sign of the times. I'm blaming cheap gas for allowing the general public to continue their head in the sand and selfish choices for personal transportation.

[darcane]

Originally Posted by Daox

Having no small cars will yet again put them behind the pack as gas prices do go back up. The current prices are unsustainable as we all know (and even the Saudi's have admitted to).

They don't have any small cars now.... the Dart/200 is a mid-size.


And mid-size sedans in general are dying off, not just for Dodge/Chrysler.
http://www.autonews.com/article/2015...-to-crossovers

In spite of car sales growing, the mid-size sedan segment is decreasing. Not just because gas is cheap and buyers can afford something with poor fuel economy but because crossover SUV economy is UP and buyers can get a vehicle with more utility and nearly the same fuel economy. The mid-size sedan is now competing with the small crossover SUV, and the crossover is winning.

I think this is a smart business move for FCA. They have a very limited selection of cars right now and need to focus on only the ones that are very profitable.

[Vman455]

Originally Posted by mcrews

Im sorry to say, none of you seem to understand business.
Item A: is small and entry level. Parts have to be specially engineered and not out of the stock bin. Price point cant exceed $x.xx (let'd say 27k). Limited profit per item. Limited buyers
(btw, that's why the first gen small cars failed in the 70's. The couldn't afford to re-engineer so they were small cars built like big cars.)

The Dart and 200 are both on the Fiat Compact platform; minimal re-engineering was required to get them to market, and parts are shared with European models and the Jeep Cherokee. Just about everything on them is "out of the stock bin."

Item B: big and entry level to top of line. Wide range of options. Parts are normal size and can be swapped across the tool bin. Price point can exceed $XX.XX (let's say $60k) wide range of buyers.

So, in review, I'm I company and accountable to myself, my Stockholders, my employees and finally my customers.
A. in the back of my mind I have to remember that there is a FIXED cost per vehicle of wages and union benefits (driving my price point).
B. it's easier to commonly share internal parts that are a common size.
C. Trucks make up 1/2 (yes HALF) of all vehicles sold.
D. trucks have the largest profit margin outside of luxury brands top models.

I (as a company) don't care about whiney people who NEVER bought my new eco-cars when I made them. I care about staying in business and building what sells.

You can all the emotional and illogical comments you want.
But at the end of the day, BUSINESS is BUSINESS.

We aren't being illogical. First, plenty of other auto companies (*cough*Ford*cough*) have well-reviewed and strong-selling small car lines in addition to being the largest volume manufacturer of light trucks in the country. Second, as fuel economy requirements rise in coming years, FCA will have a hard time meeting them without small and midsize cars in their portfolio; any businessperson worth their salt should be taking that into consideration when planning product cycles into the next decade, when those regulations take full effect. Third, while gas prices are low right now and driving more consumers into trucks and SUVs, this will not last indefinitely, as Marchionne believes--as soon as Saudi Arabia says uncle and turns off the taps, prices will go up, and given their budget deficits just a year into this strategy, that's likely to happen sooner rather than later, I think. The end result will be a replay of 2008: Chrysler, dependent on truck sales that fall in response to increased fuel prices, will teeter on the edge of bankruptcy, but this time there won't be anyone to save them. A plan that has a strong possibility of resulting in the failure of the company is not sound business. I'm certainly not investing anything in FCA.

For the record, I bought a new eco-car less than two years ago. Chrysler didn't make anything comparable then, and now they're only moving further away. Contrast their behavior with that of Toyota or Hyundai, who are introducing new or redesigned economy models--they will be well-positioned when gas prices go back up.

[Vman455]

Originally Posted by darcane

They don't have any small cars now.... the Dart/200 is a mid-size.

The distinction is semantic, since it's based on interior volume. According to the EPA, the Audi A8, Cadillac CTS, Chevrolet Sonic5, and Dodge Challenger are all also mid-size cars. But, the Dart's wheelbase (106.3") is identical to the Civic's and Corolla's, and the 200's (108") is 14" shorter than the Chrysler 300's (120") or said A8 (122").

[darcane]

Originally Posted by Vman455

The distinction is semantic, since it's based on interior volume. According to the EPA, the Audi A8, Cadillac CTS, Chevrolet Sonic5, and Dodge Challenger are all also mid-size cars. But, the Dart's wheelbase (106.3") is identical to the Civic's and Corolla's, and the 200's (108") is 14" shorter than the Chrysler 300's (120") or said A8 (122").

I'm not sure where you get your info from... but the Audi A8 is a full-size and Chevy calls the Sonic a "small car" (it usually gets grouped with subcompacts be Edmunds et al).

Interior volume is one of the more important determinations of the size of a car as that's what you interact with when operating the vehicle... And, of course, overall length, height, and width. Meanwhile wheelbase is rather arbitrary in determining a vehicle size.

Compare the 200 to the Malibu and Accord, and all three are within about 1" in height, width, and length despite the differing wheelbases. Camry too, but it's about 2" shorter. These are all mid-size cars. Meanwhile, the compact Corolla and Civic are both 10" shorter!

I stand by my statement. Chrysler/Dodge makes no small car.


EDIT: Actually, I just noticed something that may have tripped us both up. The 200 and Dart aren't the same car. 200 is a mid-size, Dart is a compact.

[darcane]

Originally Posted by MetroMPG

At least Chrysler Mexico has the right attitude:



The Dodge Attitude

A re-branded 40 MPG 1.2L Mirage sedan.

Which is coming to the States (as a Mitsu) this year.

This could be the partnership alluded to in the press release. From:
Updated Fiat Chrysler plan ups 2018 financial targets

The company, according to Marchionne, is in continuing discussions with potential partners that could “provide a product from their facilities” to allow the company to cover gaps in the lineup left by the compact Dart and midsize 200. It’s unclear whether Fiat Chrysler would purchase re-badged cars or produce the cars using their current platform.

If they are already rebranding Mitsubishis (again) it wouldn't be much of a stretch to rebrand more of them to fill in some gaps.

[Hersbird]

Too bad as I think the 200 is the best looking smallish siize car out there. With the 3.6 its pretty sporty too.