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Fiat Chrysler Renault Merger Talk Heightens

May 28, 2019 by admin 5 Comments

A blockbuster merger of automotive manufacturers may produce the world’s largest automaker, especially if two outside automakers are also brought in. Fiat Chrysler, itself the result of a 2014 merger between European and North American manufacturers may soon tie in with Renault, the French automaker.

Renault is currently reviewing an offer from Fiat Chrysler to merge the two companies with each taking a 50 percent stake in the other. FCA produced 4.8 million vehicles last year to Renault’s 3.9 million, for a combined 8.7 million units. However, Renault is worth 10 percent more than FCA, which means the latter will supply more cash to even the transaction. Renault is worth more in part because of its investment in an alliance with Nissan and Mitsubishi.

Marchionne, the Capital Junkie

A Fiat Chrysler merger with another automaker is something the late Sergio Marchionne insisted must happen to ensure FCA’s long-term survival. The former CEO and Chairman of FCA died unexpectedly last year, never seeing his dream fulfilled. However, it was Marchionne who outlined in his seminal 2015 report, “Confessions of a Capital Junkie,” industry consolidation.

Specifically, Marchionne explained that consolidation is the key to remedying the destruction of capital. In particular, he noted that both regulatory- and consumer-driven improvements such as tighter emissions controls, new powertrains, safety upgrades, infotainment services, and the push to autonomous drive, are expenses difficult for manufacturers to bear, especially those with a lower sales threshold. Further, Marchionne indicated manufacturers would need to sell at least 6 million vehicles annually to remain profitable, something they could accomplish through either a merger, acquisition or by means of a partnership, such as an alliance.

With a combined 8.7 million annual units (assuming the combined entity could maintain its momentum), Fiat Chrysler Renault would easily pass Marchionne’s threshold. However, it’ll take years for real cost savings to kick in as the new entity gradually merges platforms, shares powertrains, and utilizes technologies across the affected brands.

Jeep is the big prize FCA brings to a Renault merger.

FCA and Renault Brands

For FCA, the automaker brings with it several brands, including Jeep, Ram, Chrysler, and Dodge, serving North America primarily. Fiat, Alfa Romeo, and Maserati are especially strong in Europe. As for Ferrari, the Italian sports car brand is now a separate entity and would not be included in the deal.

As for the French automaker, it brings the Renault, Dacia, and Lada brands to the merger. It also owns the Alpine sports car marque and has an 80-percent stake in Renault Samsung Motors, a Korean manufacturer.

By default, Nissan and Mitsubishi are also included as Renault has a stake in Nissan, which has a stake in Mitsubishi. However, much friction exists between Renault and Nissan over the firing and legal detention of Carlos Ghosn, who was the CEO of all three firms. Renault had been pushing for a full-blown merger with Nissan, but the Japanese automaker has fiercely resisted that move. With FCA onboard, Nissan’s stake in the new entity will be diluted, which might impact the alliance.

So Much Potential

An FCA-Renault merger brings with it much promise, but also many risks. Although FCA is successful, the previous DaimlerChrysler model was not. The new entity faces challenges, including bringing different cultures together. Further, France and Italy have vested interests in the industry, with France holding a stake in Renault. In any case, it appears the French government favors the merger.

FCA’s strongest brand is Jeep, which it is quickly transforming from a regional player to an international powerhouse. Indeed, the automaker will likely press forward with a plan to build a new manufacturing plant in Detroit to produce the Jeep Wagoneer and Grand Wagoneer, upscale models designed to take on Land Rover (Discovery and Range Rover series). Jeep’s growth is phenomenal and doesn’t appear ready to slow any time soon.

The Ram brand brings big profits to FCA with the large pickup truck adding a half-million sales annually. The new entity may find fresh markets for Ram, including perhaps Russia where Lada rules.

As for the Dodge and Chrysler brands, the survival of these two marques may depend largely on just how far the merged company plans to extend its reach. Both have had a place in the American automotive landscape, with a limited reach beyond. And both have lost several models over the past few years as FCA emphasizes utility vehicles and trucks over cars.

See Also — Fiat Chrysler Automobiles: No Takers

Ram Chassis Cab is Here and Brings With it Class-Leading Numbers

February 8, 2019 by admin

Ram pickup trucks are tearing up the market, thanks in part to an all-new model that’s “bringing it” to the segment. That model is none other than the Ram 1500, which is the brand’s standard full-size truck.

But the 1500 is also joined by a pair of heavy-duty models, the 2500 and 3500. These two vehicles help Ram claim the highest performance, payload and towing numbers in the business.

Ahead of the Chicago Auto Show this week, we began to hear rumblings of something new from Ram. One rumor was quickly confirmed — an available 60/40 split tailgate, giving Ram a viable option to GMC’s “trick” gate.

All-New Ram Chassis Cab

Fortunately, Ram isn’t stopping there. Fiat Chrysler’s truck brand announced that it is releasing all-new chassis cab models. These updated trucks (3500, 4500, and 5500) come with a Cummins 6.7-liter turbo-diesel six-cylinder engine with an output of 360 horsepower and 800 pound-feet of torque. Buyers can also select a 6.4-liter gasoline V8 engine. Both engines work with an 8-speed automatic transmission.

Yes, these diesel performance numbers are lower than what the standard Ram 3500 delivers, but that’s okay — the real proof of what the new chassis cab does is in another set of numbers.

And those numbers put Ram Commercial at the top of the segment as this pickup truck has a Gross Combined Weight Rating (GCWR) of 43,000 pounds. Moreover, the new Ram supplies 35,200 pounds of towing and a payload capacity of 12,510 pounds. Thus, Ram can claim top numbers ahead of its competitors: Ford and Chevrolet/GMC.

2019 Ram Chassis Cab

Upfit and Outfit

At the press conference announcing the new models, a Ram spokesman noted the new trucks may be outfitted to serve in a variety of ways. As such, Ram displayed models that included a bucket truck, a crew cab with a horse trailer, and other work vehicles. The spokesman also suggested the chassis cab could be converted into an ambulance and that’s something we don’t usually see from Ram.

The new chassis cab is stronger and lighter than before thanks to the truck maker utilizing 97-percent high-strength steel frames. Thus, torsional rigidity is up, while weight is down — by approximately 120 pounds.

Tech and Style Highlights

Ram equips the chassis cab with UConnect 4C with a 12-inch display. The package includes the latest audio entertainment with SiriusXM with 360L. Other updates include a “reimagined” center console with a functional workspace featuring more than a dozen different storage layouts. It also has a wider docking area for optional wireless charging and has three USB ports (with two more in the rear).

A pair of available 115-volt three-prong plugs is designed to handle up to 400 watts for charging electronic devices or power tools. Moreover, folding up the rear bench seat reveals an additional contained storage space with under-seat compartments.

Four different grille styles accompany the 2019 Ram Chassis Cab, with not a crosshairs look to be found. The new bumper has larger openings, which supply greater airflow to the turbo intercooler. Ram also integrated proximity sensors to make them less obvious. You’ll find three headlamp variations, including an adaptive front lighting system. Finally, a new shark antenna handles radio, Wi-Fi, navigation and SiriusXM 360L.

Ram Commercial Truck

The Hit Parade

Ram continues to chalk up big gains and that’s a reflection of an automaker anticipating customer needs. Despite all the superlatives gushed at the news conference (e.g., massive, big, best-in-class, powerful) Ram appears to put up with those claims. That’s another salvo fired across the bow of both Ford and GM.

Photos copyright Fiat Chrysler Automobiles.

Fiat Chrysler Considering New Models for Ram Brand

July 20, 2016 by admin Leave a Comment

At least two new models are under consideration.

Dodge Ramcharger Prospector by Greg Gjerdingen is licensed under CC BY 2.0

Take a quick look at the Ram brand and you’ll see four models based on its full-size pickup trucks —1500, 2500, 3500, and Chassis, plus a pair of imports from Fiat, the ProMaster and ProMaster City. Compared to what GMC and Chevrolet are offering, Ram is coming up short in model offerings.

This may seem like a strange thing from a manufacturer heavily skewed toward all things trucks and SUVs. But with Jeep in the equation, the tilt toward the SUV brand has been apparent and will continue as a new Wrangler and a Wrangler-based truck are soon released.

Ever since Ram separated from Dodge, it has lacked the models some believe it should include, such as the now-retired Dakota midsize pickup truck, and the Durango SUV. The Durango stayed on with Dodge, leaving Ram without a single SUV to offer. That deficiency may soon be eliminated if Mike Manley, head of FCA’s Jeep and Ram brands, has his way.

Large SUV, But Not For Ram?

In an interview conducted by the Detroit Free Press, FCA is considering a large SUV based on the platform underpinning the Ram pickup trucks. That model would compete with the likes of the Chevrolet Suburban and GMC Yukon XL, and represent a strong profit center for the brand. Indeed, large SUVs typically command profits of at least $10,000 and with GM building more than 200,000 of them in 2015 spread across four model lines, that’s $2 billion in profits realized by GM.

The next-generation Ram 1500 is due out in early 2018 and that presents an ideal time to consider an SUV variant. FCA is also moving Ram production to Sterling Heights, Michigan, and will gain build capacity. At the same time, Manley indicated that Ram would not get the big SUV. Instead, it would be built for either Jeep, Dodge or Chrysler.

Return of the Dakota?

Another model lacking from the Ram line is a midsize pickup truck. Ever since the Dakota was canceled in 2011, talk of a replacement has surfaced. With GM bringing back the Chevrolet Colorado and GMC Canyon in 2015, the segment has rebounded. Also benefitting are the class-leading Toyota Tacoma and the aged, but still popular Nissan Frontier. Combined, the segment has reversed its steady decline as consumers consider smaller, but still capable pickup trucks.

FCA could develop an all-new platform to support a midsize pickup truck, but it might also turn to Jeep to use the Wrangler’s platform, soon to yield a pickup truck variant. Sharing platforms is economically sensible, but it might also diminish the Jeep brand. Either way, a body-on-frame pickup along the lines of the Colorado and Tacoma, and not like the unibody Honda Ridgeline seems possible.

Possible Midsize SUV

Looking beyond a midsize pickup truck, yet another Ram model is possible, this one a midsize SUV based on the new truck. In a segment where only the Toyota 4Runner and Jeep Wrangler are left (all other models are crossovers), manufacturers are reconsidering whether to build truck-based SUVs smaller than the big models still available today.

Just this past week, rumors of such a model for GMC have resurfaced, a model that would compete directly with the Jeep Wrangler. Although FCA wouldn’t necessarily want to diminish Jeep sales by building such a model under the Ram flag, such a vehicle would allow the company to enjoy greater economies of scale.

Rising Ram and Jeep Sales

Through June 2016, Ram sales are up 11.3 percent on 256,972 vehicles sold. That’s well ahead of the 1.4 percent gain for all models and follows Jeeps’ 16.5 percent rise.

As for new models, Manley didn’t offer definitive plans. Instead, he supplied possible scenarios, what only will whet the appetite of Ram aficionados further.

Recent News — New 2017 Ford Super Duty Lifts the Bar

New Products May Bolster Ram Brand

November 5, 2015 by admin Leave a Comment

Where is Fiat Chrysler Automobile taking the Ram brand? A large SUV is under consideration, what could bring sales and big profits to this truck-based marque.

Ever since Fiat Chrysler Automobiles separated Ram from Dodge to form a distinct brand, enthusiasts have wondered if additional products might eventually join the model line. Well, those products have come in the form of two Fiat-supplied products — the ProMaster Van and the Promaster City — a pair of commercial vehicles accounting for fewer than 1 in 10 Ram models.

The 1500 as well as the 2500/3500 series pickup trucks has essentially been the Ram brand, but other models are under consideration. This past August Auto Trends explored the possibility of a midsize Jeep pickup, one that might also yield a Ram variant, to replace the previous Dodge/Ram Dakota.

Jeep hasn’t committed to re-entering the expanding segment, but as Ford seriously considers returning with an all-new Ranger, the possibility of new models from Fiat Chrysler shouldn’t be quickly dismissed.

A Big Ram SUV?

Last week, Automotive News shared the news that a large SUV based on the Ram 1500 line is a possibility. That model, if built, would compete against the Chevrolet Suburban and Ford Expedition, SUVs derived from each manufacturer’s pickup truck line.

Fiat Chrysler President and CEO Sergio Marchionne sees a segment ripe for the participation and believes that his company has “…a reasonable chance of getting at least part of that market.”

He also believes fuel prices will remain low for the foreseeable future, although it would take several years to ready such a model for the market. Anything can happen in the interim.

Readying a New Ram 1500

The current generation Ram 1500 arrived on the market in 2010 and received an update in 2013. It will receive yet another refresh before the next generation model arrives in 2019. The delay comes as Fiat Chrysler pours money into resurrecting Alfa Romeo. It will also permit time for an expected aluminum-bodied truck to make its debut.

Likely, the big Ram SUV would follow the new pickup trucks by a year, a customary delay that Ford and Chevrolet usually follow with their own models. That means the new model is still four years away and a lot can happen between now and then.

Making Money With Big SUVs

Larger vehicles, including SUVs have some of the highest profit lines in the business. The last time Chrysler fielded such a model was in the two-door Dodge Ramcharger, a full-size SUV built from 1974 to 1994. The Ramcharger was based on Dodge’s earlier D Series line. But, when the all-new Dodge Ram rolled out, it was retired.

Also, instead of continuing with the Ramcharger, Chrysler concentrated on building the Jeep Grand Cherokee and the Dodge Durango, two distinctly different midsize SUVs. Continuing with the Ramcharger would have also adversely affected the manufacturer’s corporate average fuel economy (CAFE) ratings — the company has long been top heavy with less fuel efficient models.

A Three-Row Jeep Grand Wagoneer

Bringing a new SUV to the Ram line would come just as the automaker readies another product, the three-row Jeep Grand Wagoneer. Unlike a potential body-on-frame Ram SUV, the Grand Wagoneer will be of unibody construction. FCA intends to have it compete with the likes of Land Rover, by taking a more upscale approach to the market.

Likely, FCA is looking at other products to expand the Ram line. Beyond a large or midsize SUV, the lower end of the market might also yield a product. However, fuel prices, FCA profitability and market factors can impact these plans, pushing some products back while perhaps bringing a few others to the forefront.

Flagging Fiat Sales: No Easy Answer

October 14, 2015 by admin Leave a Comment

The Fiat brand has this 500X crossover in its portfolio.

It must be tough sitting in a meeting of Fiat Chrysler brand heads, especially if your brand is underperforming. Sixty-eight straight months of year-over-year sales improvements puts an enormous pressure on executives to succeed. Sure, the streak will someday be broken, but the last thing any brand head wants is to be blamed for ending it.

Fiat Chrysler has enjoyed a tremendous rebound over the past six years as two separate and distinctly different companies were merged, Ram was separated from Dodge, and Chrysler was reassigned as a mainstream brand. In addition, the Fiat brand was brought back to the US in 2012 followed two years later by Alfa Romeo. FCA is on a roll and is continuing to gain market share.

Jeep, Ram, and Chrysler are continuing to grow, but Dodge sales are down with most of that loss attributed to a discontinued product, its midsize Avenger sedan. Dodge is right where it is supposed to be as a newly minted performance brand and sales should bottom out by early 2016. As far as the Italian brands go, Alfa Romeo’s gradual roll out will receive a major boost late next year when the gorgeous Giulia compact luxury sedan debuts.

Fiat 500L

Pictured: Fiat 500L.

That leaves one brand we’ve scarcely mentioned, the eponymous Fiat marque.

Certainly, FCA had high hopes for Fiat when the first of its North American 500 models was officially presented at the 2011 North American International Auto Show in Detroit. Many believed that the diminutive vehicle would pull in customers as high fuel prices coupled with Italian enchantment would drive interest in the brand.

Unfortunately, that hasn’t happened even as new models arrived, including the compact 500L followed by the 500X crossover. Under normal market conditions all three models should provide strong sales, however this market is anything but normal as lower gas prices, excellent financing rates, and intense competition has buyers looking elsewhere. Indeed, Fiat brand sales are down 10 percent year-to-date through September and would be off by more than 20 percent without the new-for-2016 500X n the product portfolio.

The Fiat sales drop may not have a tremendous impact on FCA’s overall sales, but it isn’t something that can easily be dismissed. Perhaps that is why the company’s CEO and President Sergio Marchionne decided earlier this month that Fiat brand head Jason Stoicevich should move on.

Indeed, last week, as part of a larger shuffling of brand managers, Stoicevich was reassigned to head of fleet operations and small business sales in the US. However, by the next day Stoicevich resigned and left the company altogether. Notably, no reason has been given for his abrupt departure.

Chrysler brand chief Alistair Gardner also was reassigned, but his sales numbers were sound. Additional management shuffling was also accomplished as Timothy Kuniskis now oversees three brands: Dodge, Chrysler and Fiat.

Alfa Romeo Giulia

Alfa Romeo sales should see a spark turn into a flame when this Giulia sedan
arrives on the market in late 2016.

We might speculate on the reasons why Stoicevich left, but that theorizing would not necessarily be correct. Stoicevich was in charge of Fiat for two years and seven months and may have been disappointed with the reassignment especially with new product on the way. One of those products is the reborn Fiat 124 Spider, a new model that shares its platform with the Mazda MX-5 Miata.

It has been thought by some that the 124 Spider will be shown at an upcoming auto show, with The Detroit Bureau identifying Los Angeles as that venue. The Los Angeles Auto Show kicks off next month just ahead of Thanksgiving and is the first of four important North American shows where automakers roll out new products. Detroit, Chicago and New York follow.

With the 124 Spider in the fold, the Fiat brand should get a fresh look from customers even if its sales are small in number. As for increasing those sales to reach 50,000 units per year, Fiat may need some help in the form of higher fuel prices. Certainly, the 500X and 124 Spider will contribute, but sales of the other two models may continue to decline or at least stabilize at levels far below what FCA management wants, but probably not to the detriment of Kuniskis’ place at the management table.

Fiat photos copyright Auto Trends Magazine; Alfa Romeo photo copyright Fiat Chrysler.

Fiat Chrysler Automobiles: No Takers

June 10, 2015 by admin 3 Comments

The Fiat Chrysler merger drama continues. The current narrative has boss Sergio Marchionne asking activists to pressure GM to buy FCA.

Fiat Chrysler chief executive Sergio Marchionne has been pressing hard to find a partner for his company. Trouble is, there are no takers and not a whiff of interest has been expressed by a single manufacturer within and without the industry.

That hasn’t stopped Marchionne (pictured, right) from employing tactics that are raising eyebrows everywhere, including at the General Motors Company. Indeed, GM has confirmed that Marchionne reached out to CEO Mary Barra earlier this year in a bid to arrange a meeting to discuss a possible alliance. However, that overture was rebuffed.

Now, Marchionne is appealing to investors in a bid to force GM’s hand. Its part of his personal quest to push for industry consolation, a move that he claims would save manufacturers billions of dollars in start up costs.

Sources, including the Wall Street Journal, claim that Marchionne has been energized by activists at GM who have successfully pushed for the company to raise its stock dividend and buy back billions of dollars in stock. To that end, Marchionne is appealing to these same activists to help move the needle.

But Mary Barra insists that her company won’t and cannot be distracted as GM continues with an internal consolidation that has saved the company billions of dollars and should continue to reap benefits as it seeks to gain a leading position on return of capital. Moreover, the company is eager to bring the ignition switch matter to an end, a debacle that has claimed the lives of at least 111 people to date.

With each pronouncement that Marchionne makes at a press conference, an industry event or elsewhere, reactions are coming from other quarters, including the rank and file that stands to lose the most, if FCA were acquired, as well as from dealers who wonder if the delay in important new product, including the next generation Ram pickup truck will have on its sales.

2016 Alfa Romeo 4C

And then there is the curious stance Marchionne is taking with advancing Alfa Romeo, an upscale vehicle line that has just begun to sell cars in the US after a two decade hiatus.

Alfa Romeo returns to the US market this year and will offer 400 copies of its 4C Spider. But that’s just a tiny slice of the 150,000 Alfa units per year FCA says that the market will sustain by 2018. Its part of a $7 billion investment FCA is making that is supposed to yield 8 new Alfa Romeo models and raise global sales from 74,000 annual units to 400,000 vehicle sales within the space of four years.

That ambitious goal has its share of naysayers who doubt that Alfa can muscle into a market dominated by such luxury makes as Mercedes-Benz, BMW and Lexus. In essence, Marchionne is attempting to elevate Alfa within years for what has taken decades for brands such as Acura and Infiniti to find favor amongst discriminating consumers.

Ram ProMaster City

Ram and Jeep are the two most valuable FCA brands.

Industry scuttlebutt has Marchionne talking up a merger with GM to perhaps force another manufacturer’s hand, namely the Volkswagen Group. Volkswagen has expressed interest in buying one or more Fiat brands in the past and could leverage FCA to dramatically heighten the company’s ascendancy in the United States.

Certainly, acquiring FCA would push Volkswagen Group US sales into second place behind GM and ahead of Ford and Toyota, an especially enticing move that would give this German manufacturer an edge it hasn’t been able to realize on its own. Consequently, it would also push VW’s annual sales to about 15 million units or well ahead of Toyota and GM.

Marchionne’s motives regarding securing a suitor may not be clear, but some analysts are sensing his desperation. Whether that worry is authentic or contrived, the best approach here might be for executives to simply wait and see.

Pentastar Engine Family Passes 5 Million Milestone

May 28, 2015 by admin Leave a Comment

Pentastar is the name of Fiat Chrsyler’s modern V-6 engine family. The engines are found in more than a dozen models, and power a variety of vehicles. To date, more than 5 million of these engines have been deployed worldwide.

The Jeep Grand Cherokee was the first FCA model with a Pentastar engine.

Fiat Chrysler Automobiles announced on Wednesday that its family of V-6 Pentastar engines just surpassed a significant milestone. Notably, five million of its popular V-6 engines have been placed under the hood of an assortment of Chrysler, Dodge, Ram and Jeep vehicles, and demand for these modern power plants continues to grow.

Three Engine Displacements

First introduced in 2011 to power the Jeep Grand Cherokee, FCA has since expanded the engine line to include power plants displacing at 3.2- and 3.0-liters each. The smallest of this intrepid trio is produced for the Chinese market only.

FCA says that its Pentastar engine family represents its most advanced six-cylinder engines yet. Pentastar incorporates a number of technologies, which enable the engine to squeeze out more power from each footprint and do so efficiently and in an environmentally responsible way. Some 14 vehicles across four FCA brands offer Pentastar engines.

“The success of the Pentastar V-6 engine family continues to be a testament to our powertrain engineering prowess,” said Bob Lee, Vice President – Engine, Powertrain and Electrified Propulsion, and Systems Engineering, FCA – North America. “This engine delivers world-class performance in multiple displacements and vehicle applications around the globe. We’re extremely proud of how this engine family has evolved to provide our customers with a wide range of performance capabilities.”

The base engine for the Dodge Charger is a Pentastar engine.

Three Engine Plants

It takes three engine plants to handle Pentastar demand. All three plants — Trenton Engine Complex, Saltillo South Engine Plant (Mexico) and Mack Avenue Engine Plant — produce the original and the largest of the three engines. The Trenton facility also produces the smallest engine, while the Mack Avenue plant builds the middle engine.

Pentastar has enabled FCA to claim horsepower leadership in a number of categories. For instance, the 283-horsepower achieved by the full-size Ram ProMaster van is the best in its class. Further, the 295-horsepower output of the Chrysler 200 is tops amongst midsize sedans. Moreover, the Dodge Grand Caravan and Chrysler Town & Country minivans also achieve 283-horsepower, besting competing vehicles such as the Honda Odyssey, Toyota Sienna and the Kia Sedona.

Old Engines Expunged

When Chrysler began development of its Pentastar family, it sought to replace as many as seven V-6 engines of varying ages and sophistication found across its product lines. That meant accommodating a variety of drive systems — front- rear-, all- and four-wheel drive as well as both manual and automatic applications. Notably, the Pentastar family is paired with 6-speed manual as well as 6-, 8- and 9-speed automatic transmissions.

Regardless of displacement, there are commonalities across the Pentastar family line. For instance, the engine family features a 60-degree, deep-skirt, die-cast-aluminum cylinder block with six-bolt main caps designed to offer matchless rigidity for noise, vibration and harshness mitigation.

A Pentastar V-6 engine in the Chrysler 300.

Other features include: variable valve timing, contoured composite cylinder-head covers, select-fit pistons with polymer-graphite-coated piston skirts, and a special “silent time” drive chain with inverted teeth in a bid to minimize sprocket noise, vibration and harshness.

FCA also likes to point out the engine family’s specially designed exhaust manifold. This unit is integrated with the cylinder head for outstanding effectualness. And not to be left out is the intake manifold, what benefits from low-rumble tuning.

Pentastar Family Usage

Can you name the 14 vehicles that offer Pentastar engine? Hint: it is found in midsize and larger models.

In an case, you can find Pentastar in the Chrysler 200, 300 and Town & Country; the Dodge Durango, Charger, Challenger, Journey and Grand Caravan; the Jeep Wrangler, Cherokee and Grand Cherokee; and in the Ram 1500, C/V Tradesman and ProMaster.

See Also — Premium Value: Chrysler 300 Limited

Why No One Wants To Hook Up With Fiat Chrysler (FCA)

April 14, 2015 by admin 1 Comment

Rumors of a possible Fiat Chrysler (FCA) alliance with another automaker have been circulating for the past several months. That’s understandable as FCA chairman Sergio Marchionne has iterated that his company’s best chance for long-term survival may be tied with the fortunes of another automaker.

Highly-regarded Reuters is one of the latest publications to advance the prospect of an FCA alliance with some other manufacturer. However, for Marchionne there does not seem to be too many viable prospects willing to merge or ally themselves with FCA. And without such an arrangement, Marchionne’s once bright legacy may yet turn opaque.

Here’s what Marchionne wants and what will likely thwart his effort:

A General Motors merger.

FCA boss Sergio Marchionne.

GM, along with Toyota and Volkswagen, is poised to sell 10 million vehicles worldwide in 2015. GM has been close to this lofty threshold before, but has never sold as many vehicles as it is doing right now. Indeed, once on life support, then bankrupt, GM has stormed back and is breathing fresh life into its four surviving US brands. It is also preoccupied with reviving its European operations.

The only enticement in FCA for GM might be the Jeep brand. Jeep, along with Ram trucks, are the two profit drivers for that company’s US operations. Beyond that, Fiat can give GM quick access to Europe, but then it would find itself competing against better entrenched manufacturers, especially Volkswagen.

Don’t expect GM to show any interest in FCA. At the same time, they’re working diligently to advance their own agenda and an FCA collaboration would only impede its effort.

A Ford Motor Company acquisition.

No, FCA is not in a position to acquire Ford. Ford, on the other hand, might consider FCA, but only if it was in its best interests. Be that as it may, there is nothing to suggest that FCA has anything that Ford needs or wants, except Jeep.

Like GM, Jeep could be of interest, but both automakers are doing quite well with their own lines of utility vehicles. Further, Ram trucks are redundant and would only discombobulate matters. And Hellcat poses a challenge to Mustang, while Ford has its own super car aspirations in the GT, so toodle-oo to Viper.

Like GM, Ford has no need for FCA. In addition, the blue oval has a solid product line and is now working diligently to rekindle the Lincoln flame.

See Also — Up Next: Ford-Volkswagen Tie-up?

Looking Beyond America

Marchionne is not just looking at his US competitors for a possible alliance or merger, but he is scoping the global market. Certainly, a possible target would be PSA Peugeot Citroën, but the French manufacturer is busy trying to heal itself. Likely, any interest from PSA is several years away or well after Marchionne relinquishes his role.

Other opportunities might require considering a smaller scale confederacy and include Asian manufacturers such as Suzuki, Isuzu and Mazda, small companies that could benefit from a strategic alliance. Of course, all three are strong in Asia, the very market where FCA’s penetration is the smallest.

Marchionne’s Motives for FCA

While preserving his legacy may be one reason for finding a partner for FCA before he leaves the scene in early 2019, the CEO’s overarching intention may be something completely different. Specifically, FCA doesn’t have the financial strength of its top competitors and may have difficulty weathering the next downturn, what is likely to arrive before his exit.

Indeed, FCA has two shortcomings or weaknesses that may manifest in an entirely negative way in the coming years: a high debt load and a low operating margin of 3.4 percent (compared with 5.4 percent for the industry average). Both are serving as ominous signs that FCA’s short-lived glory days may be in its rear-view mirror, what may best explain Marchionne’s eagerness to find a partner for FCA and the reluctance of competitors to forge such an alliance.

***Photo courtesy of by Agência Brasil, a public Brazilian news agency.***

5 Reasons Why Volkswagen Fiat Chrysler Makes Sense

November 7, 2014 by admin 2 Comments

Imagining Fiat Chrysler as part of the Volkswagen Collective.

Speculation about a possible blockbuster Volkswagen Fiat Chrysler merger has come up again. Last summer, Volkswagen and Fiat flatly denied that they were discussing a merger, despite a high-level meeting between key executives.

This week, former Hyundai CEO John Krafcik speculated in his address to the Automotive Press Association at the Detroit Athletic Club that such a merger between the companies would be a “brilliant” move. He noted that the combined entity would provide a better mix of vehicles, one better split among cars, utilities, pickups and luxury vehicles.

We’re not saying such a merger would happen or that it even should happen. Still, it isn’t hard to grasp what benefits might come out of such an arrangement.

Volkswagen Collective

1. Economies of Scale

The bigger you are the better job you can do in spreading your costs around. Volkswagen has invested tens of billions of dollars in modular platforms, what makes it possible for the automaker to build a variety of different vehicles on the same footprint. The upfront cost is daunting, but once implemented it can yield huge savings.

Fiat Chrysler is struggling to enter different segments, something they would be able to do faster by harnessing Volkswagen’s flexible platforms. Product development overhead would be reduced, giving the newly-expanded Volkswagen Group a competitive advantage.

2. Deeper Market Penetration

Volkswagen is big on producing mass-market cars, utilities and luxury vehicles. Where it is nearly completely absent is in pickup trucks. Sure, you have the Amarok, but the big profits are in the large trucks, such as with the Ram 1500. By absorbing Fiat Chrysler, Volkswagen gains another market segment and a highly profitable one at that.

Ram Trucks with Volkswagen Group backing would be better able take on Ford and General Motors, the two top pickup truck producers. And if the midsize truck segment strengthens, Volkswagen backing could enable Ram to bring back the Dakota or something like it.

3. Improved Product Mix

The better your product mix, the more likely you will attract customers. In the previous section we touched on market penetration, but it is product mix that can expand your customer base.

Take one look at most Fiat Chrysler brands and they’re missing a product or two that could make a difference. With Volkswagen backing, each brand could fill out its product lines and become better suited to take on its competitors. The Chrysler brand could become a formidable competitor to Toyota, Chevrolet, Honda, Nissan and Ford. Jeep might push into Land Rover territory by sharing an SUV platform with Audi. Options that were not attainable before would suddenly be made manifest.

4. Volkswagen Brand Problem Solved

Let’s be clear about one thing: the Volkswagen brand is struggling mightily in the US. Successful nearly everywhere else, VW cannot let loose the baggage that has held it back, namely perceived lower quality cars sold at a premium price. Besides, not too many people are excited about the Passat.

A merger wouldn’t necessarily benefit the Volkswagen brand stateside. Even so, it probably wouldn’t matter. The Volkswagen Group could reposition VW in the US and Canada to take on a more premium status, along the lines of Buick and Subaru.

5. Consolidate Brands

Volkswagen currently manages 12 brands and is doing a much better job of it than GM did when it had 8 brands. Some have criticized Volkswagen for being brand top-heavy, but that hasn’t hurt them.

Likely, Volkswagen will seek some sort of brand consolidation if it snaps up Fiat Chrysler. The least painful decision would be to fold Ram back into Dodge. Or, Dodge might be eliminated, Ram kept and Dodge products moved to Chrysler.

The Jeep and Fiat brands look good to go, but if one had to leave that would be Fiat. A doubtful decision, but a possibility. More likely, Volkswagen would eliminate Lancia, keep Alfa Romeo and if Ferrari and Maserati are part of the deal, those brands would survive too. Without any brand elimination, the consolidated Volkswagen Group would comprise 20 brands. That’s hard to imagine!

Volkswagen Fiat Chrysler

What are the chance of a blockbuster Volkswagen Fiat Chrysler merger taking place? That’s hard to say. There are some people who think that there are cultural obstacles, but they are equating Daimler (an earlier owner of Chrysler) with Volkswagen. Not all Germans are alike…or are they?

Likely, Sergio Marchionne would retire if such a merger was agreed upon. And Chrysler executive salaries would undergo scrutiny, a cost that always raises eyebrows with foreign manufacturers.

Recall Roundup: October 2014

October 17, 2014 by admin 1 Comment

2014 will go down in the record books as the year of the recall. General Motors (GM) has led the way, issuing recalls affecting 30 million vehicles before the year was half gone. Close scrutiny by the NHTSA, a much-publicized internal cover up resulting in 27 confirmed deaths thus far, and strong media interest has kept recalls as one of the top stories. Competing automakers are also recalling vehicles, as the government shines the spotlight brighter than ever.

Recent Recalls

The following are among the most recent recalls announced and what they mean to you, the car owner.

Toyota has had its share of major recalls this year. This week, it recalled more than 1.75 million vehicles, including at last 750 million Toyota and Lexus sedans. The affected sedans are equipped with faulty fuel pipes that may leak, raising the risk of fire. It was the fourth international recall of at least one million vehicles made by Toyota this year reports Bloomberg.

Select Jeep Grand Cherokee models powered by a 3.6-liter engine are under recall.

On Thursday, Chrysler recalled 907,000 Chrysler, Dodge and Jeep vehicles. The recall included 470,000 Jeep Grand Cherokees; Dodge Challengers, Chargers and Durangos; and the Chrysler 300. The affected 2011 to 2014 model year vehicles are powered by a 3.6-liter V-6 engine with alternators that can fail, causing them to stall without warning. Another 437,000 2011 to 2013 Jeep Wranglers are prone to having water enter the heated side mirror wiring and cause a short reports WXYZ Detroit.

It isn’t every day that you will find yourself driving down the road and the hood suddenly flies open. That’s a possibility for owners of more than 220,000 Nissan Altimas, 2013 model year sedans only. Nissan explained to the National Highway Traffic Safety Administration (NHTSA) that “interference between the hood inner panel and the secondary latch lever, in combination with debris and corrosion, may cause the secondary hood latch to bind and remain in the unlatched position when the hood is closed.” As you might expect, a hood that flies up while you’re moving down the highway could cause you to crash.

Mitsubishi has launched a recall of certain 2008 to 2011 model year vehicles, each powered by 4B1 engines. Those engines have an engine pulley that may experience unusual wear, causing the belt arrangement to fail, leading to engine stalling reports CBS New York. Affected models include: Lancer, Lancer Evolution and Outlander (2008 to 2011), Lancer Sportback (2009 to 2011) and 2011 Outlander Sport vehicles. Mitsubishi will replace the drive belt with a rubber belt. If the drive pulley shows excessive wear, it will be replaced as well.

At the beginning of this month, the Ford Motor Company announced a recall for nearly 750,000 Ford C-Max, Fusion and Escape vehicles as well as the Lincoln MKZ for problems with the Restraint Control Module or RCM. The RCM in the affected vehicles may crack. Further, when exposed to humidity, circuits on the printed circuit board may short. If a short circuit occurs, an airbag may fail to deploy says Ford.

If you are the owner of a 2005 to 2011 Toyota Tacoma PreRunner and 44 vehicle, the fuel tank is at risk of puncture, what can lead to a fire. Due to stress or corrosion, the leaf springs may fracture. If that happens while you are driving, the spring could move out of position and make contact with the fuel tank, leading to a possible fuel leak.

Other Recalls

Besides the mentioned recalls, the NHTSA has served notice of recalls for other vehicles to include: the 2014 Dodge Ram Promaster, Chevrolet Spark, Cadillac SRX, Saab 9-4X, Chevrolet Caprice and the Ram C/V Tradesman. Visit the NHTSA’s Recalls Defects section to find out if your vehicle has been recalled. You can also learn if a previously recalled vehicle has been repaired by conducting a vehicle identification number (VIN) search to uncover that information.