Chrysler sale could bode well for future product
By BOB GRITZINGER
AutoWeek | Published 05/15/07, 1:25 pm et
Cerberus Capital Management’s $7.45 billion purchase of Chrysler likely means an influx of cash that will open the product pipeline at the Auburn Hills, Michigan-based automaker.
The private equity group’s purchase of 80.1 percent of Chrysler—current owner Daimler will retain a 19.9 percent stake—is expected to be finalized in the third quarter this year. By then, the 2008 Dodge Challenger will be less than a year from introduction, and other well-received Chrysler concepts from the past two years should be in line for the production green light.
“As a private company, Chrysler will be better positioned to focus on its long-term plan for recovery, rather than just short-term results,” said Chrysler CEO Tom LaSorda. “It will allow Chrysler to renew its focus on what has always made us special—our passion, creativity and commitment to delivering exciting Chrysler, Jeep and Dodge vehicles.”
Chrysler spokesman Rick Deneau said the company expects to continue to invest in future product as planned, despite cutting up to seven nameplates from the current 32-model lineup as outlined by LaSorda in February. All indications are that the new owners of Chrysler intend to follow LaSorda’s lead while investing even more in future product.
“These folks have seen our product lineup, and they’re quite bullish on it,” said Deneau.
Chrysler plans call for 20 new vehicles and 13 major facelifts by the end of 2009, despite reducing the company’s platforms from 12 to seven. Besides the highly anticipated Challenger, products already in the pipeline include the fifth-generation Chrysler minivan due later this year, Chrysler Sebring/ Dodge Avenger-based crossovers and the next-generation Ram pickup. Cut from the portfolio will be the Dodge Durango/ Chrysler Aspen, once the plant that produces the slow-selling big utes is shuttered in late 2009.
That leaves the dream cars to consider, from the big flagship Chrysler Imperial that debuted at the Detroit auto show in 2006 and the minicar-based Dodge Hornet shown at Geneva that year to the Dodge Demon roadster that bowed at Geneva in March ’07.
While no production decision has been formally announced on the Imperial, rumblings surrounding the Chrysler sales talks suggested that the big luxury liner was just the kind of vehicle needed to spark interest in the brand from wealthy venture capitalists. Now that private investors are at the helm, it may be only a matter of time before the Imperial gets the go-ahead.
Meanwhile, Chrysler and its Chinese partner, Chery Automobiles, are reported to be putting the finishing touches on a production Hornet that will be sold in China and the United States, as well as other global markets. The B-segment car is similar in size to BMW’s Mini. Chery also is the likely partner to provide underpinnings for the Demon, an inexpensive Mazda MX-5-sized roadster.
A familiar name likely will play a key role in shaping Chrysler’s product development plans: Wolfgang Bernhard. The former Chrysler chief operating officer—famous for riding a Viper-engined Dodge Tomahawk motorcycle onstage at the 2003 Detroit show—is now an advisor at Cerberus after a stint at the helm of Volkswagen. If anyone knows how to inject excitement into Chrysler products, it’s Bernhard. We’ll have to wait and see whether his idea of exciting product includes coddling Chrysler’s new owners’ Imperial dreams.
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