Chrysler's Ram truck rides high with Red Wings
March 5, 2012
Fred Diaz had no idea the Detroit Red Wings would break the National Hockey League's record for consecutive home wins when the Ram marketing team negotiated to sponsor a special-edition truck for the Wings.
"The initial plan was to do 1,000, and that ended up being a gross underestimation," said Diaz, CEO of Chrysler's Ram truck brand.
Now metro dealers expect to sell nearly 2,000 of the $36,684 Red Wings Ram, and the playoffs are still a month away.
It's a break that validates Chrysler's decision in 2009 to separate Ram from its Dodge brand.
Dan Frost, owner of Chrysler dealerships in Taylor and Southfield, said he has sold about 110 Red Wings Ram trucks. "But even people that aren't fans of the Red Wings are attracted to the truck because of the value," he said.
While the truck benefits from the added sales, the Wings benefit from the advertising. Ram has run a commercial called "Ram vs. Mule," comparing the toughness of the truck with the toughness of Red Wing forward Johan Franzen, whose nickname is Mule.
"Every once in a while, from a partnership point of view, you catch lightning in a bottle," said Tom Wilson, president of Olympia Entertainment.
Ram picks up momentum since split from Dodge
The decision to split Ram and Dodge has enabled the third-largest pickup brand in the U.S. to grow, according to Fred Diaz, CEO of the Ram brand.
Diaz also credits the decision to split the two brands with driving a more focused marketing message as well as a bevy of new Ram models that are drawing more customers.
"Now we have an entire department that is supremely focused on nothing but truck and commercial vehicles," Diaz said.
In 2011, Ram sales rose 22.6%, and its market share rebounded to 16.3% of large pickups -- its highest mark since 2008. For the first two months of this year, Ram's market share has continued to climb, reaching 18.3% in February.
What's more, some Ram residual values -- what a truck is worth at a certain point in the future -- are comparable to those of the Ford F-150, or about 34% of the purchase price after four years, according to data from ALG.
Even with those gains, though, some question the decision.
"It didn't help either brand," said Art Spinella, president of the consulting firm CNW Research in Bandon, Ore.
Spinella said the percentage of 2,800 potential truck buyers who said they would consider buying a Ram in January was unchanged from a year earlier.
"The customer doesn't care," said Dan Frost, owner of Southfield Chrysler Jeep Dodge. "To the customer, as far as they are concerned, it's still a Dodge pickup."
Jeremy Anwyl, CEO of New Cars, Used Cars, Car Reviews and Pricing - Edmunds.com
, said it takes years to change a brand's perception.
"I am reminded of when Datsun became Nissan," Anwyl said. "But you talk to people today and Datsun may not even be a memory."
'A lot of head scratches'
To be sure, the breakup was not easy, even for Chrysler insiders.
"At the time we got a lot of head scratches," Diaz said. "People were reducing brands, not creating brands."
The decision was based on the observation that Dodge -- with vehicles ranging from the macho Charger and Challenger to the Caravan minivan and Ram pickups -- had a muddled image.
Ram has clarified its brand image by ramping up its rough, outdoor appeal with actor Sam Elliott providing the gritty voice-overs on commercials with the tagline, "Guts, Glory, Ram."
Elliott's voice is one that Ram hopes to keep using, said Marissa Hunter, head of Ram advertising.
Separately, Ram is rolling out an advertising campaign called "Giants" that debuted during the Super Bowl pregame show and targets younger buyers and women, Hunter said.
During the last two years, Ram has launched at least six models aimed at different types of truck buyers.
Examples include the Outdoorsman, aimed at hunters and fishermen, and the Tradesman, designed to meet the needs of plumbers, carpenters and construction workers.
A special Red Wings edition of the Ram 1500 Express 4X4 Crew Cab, which was expected to generate about 1,000 in sales, is on track for sales of more than 2,000.
"I wouldn't be surprised, that if we had stayed with Dodge, that no more than maybe 20% of those things would have actually been done," Diaz said.
According to the automaker's five-year plan, Ram is scheduled for a major upgrade this year.
"It is our intent to deliver an updated product that provides to ... consumers all of those things that they demand in a pickup truck," Hunter said.
That means the 2013 Ram will likely be shown at the New York auto show in April.
What's left for Dodge?
In 2009, Ram was by far the highest-volume model for the Dodge brand.
This year, Chrysler is bringing back its Viper high-performance sports car, but it won't be a Dodge. Instead, it will be under a new SRT performance brand.
That leaves the Avenger sedan, the Journey crossover, Charger and Challenger sports cars, the Durango and Nitro SUVs and the all-new, Fiat-engineered Dart that replaces the Caliber, which was discontinued in December.
The Dart will help Dodge further redefine its image as a brand with a racing heritage for a reasonable price, said Reid Bigland, CEO of Dodge.
"Dodge is clearly a mainstream American brand ... and a brand that is really about value and performance," Bigland said. " 'Guts, Glory, Dodge' really doesn't fit."