Fiat’s association with Chrysler in 2009 had its sceptics, but it has provided the opportunity to turn both businesses around, developing products that are relevant to their markets.
Sergio Marchionne, the man in charge of both companies said: “A good example of this is the Dodge Dart which we are launching at the Detroit Auto Show. It is a car built on the Alfa Giulietta platform but with an architecture relevant to the US market.
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“It gives Chrysler an entry into a segment of the US market that accounts for nearly half the 14m cars sold there.”
The Dodge Dart goes on sale in the second quarter of 2012 and Marchionne has big expectations for the car. “It will be launched smack in the middle of the biggest -selling segment in the US market,” he said.
If the car takes-off as hoped, does Chrysler have the capacity to keep up with demand?
“As a result of the downturn in 2008-2009 a lot of capacity was taken out of the US,” said Marchionne. As Chrysler turns around and builds sales we may come to a point in the future where it will run out of capacity and have to look for source of supply globally.
“Fiat may be able to take up some of that capacity but only if it is on a cost-neutral basis. We would also have to make sure that what comes out of our plants is exactly the same as in the US – and you don’t tell Americans that they are built in Europe.”
Which led Marchionne to jump on his now familiar hobby-horse – overcapacity in Europe.
“Manufacturing capacity is far in excess of demand and all carmakers need to address this issue because it is unsustainable and some of them will fail,” he said. It needs a unified approach from vehicle markers, the European Union, raw materials suppliers, everyone. I have been banging on about this for a long time now but nobody seems to be listening.”
Jumping back across the Atlantic, is there a possibility of selling the just-launched next generation Fiat Panda in US? “I think we would have a better chance of selling Pizza in the US than the Panda, it’s not the right car,” he said.
Is that a lesson learned from the Fiat 500 which has not sold as well as hoped in North America? Marchionne puts this down to poor timing. “We launched the 500 too early, before we had the right dealer network in place. We should have waited another year.
“Also, we never intended to sell the car in big numbers. Maybe 60-70,000 a year and in a market of 14m that’s a tiny number.”
With the North American launch of Alfa delayed, are dealers getting restless? “All Fiat dealers also have Chrysler and Jeep and they have just had the best year in their history – I know because I have been cutting their incentive cheques.
“We need to resurrect Alfa in a proper way and that means going in with the right models. We must not keep making mistakes like the Alfa 159. It was a good driving car but in its segment it was 400kgs too heavy and therefore uncompetitive.
“We are never ever going to do that again. It has got to look like an Alfa and smell like an Alfa before we put the badge on it. As far as I will say at the moment the 4C will appear at the end of next year and new models and markets will follow when we are sure they are ready.”
Along with Alfa, Jeep is the Fiat-Chrysler alliance’s other global brand although Marchionne said that the 4×4-maker is seen as an all-American vehicle. “It is certainly bookended by the Wrangler and the Cherokee and without question they have to be built in the US.
“There are other products Jeep has in the C and D segments such as the Compass and Liberty which could have more global appeal and we are also considering a B-segment Jeep model which could possibly be distributed on a global basis.”
