September 14, 2010 Dealers get preview of Chrysler's new lineup | detnews.com | The Detroit News
LINK: Dealers get preview of Chrysler's new lineup | detnews.com | The Detroit NewsDealers get preview of Chrysler's new lineup
Dealers get peek at 15 new or updated models set for release in crucial next four months
More than a year out of bankruptcy -- and nearly a year since revealing its ambitious, five-year global plan -- Chrysler Group LLC is poised to bring to market a revamped vehicle lineup designed to re-engage buyers.
About 1,700 Chrysler, Dodge and Jeep dealers will gather today at a convention center in Orlando, Fla., for a first look at the automaker's next generation of products.
They also will be updated on Chrysler's turnaround progress, and have an opportunity to meet -- many for the first time -- the driving force behind the product onslaught: Chrysler and Fiat CEO Sergio Marchionne.
Chrysler hasn't held the dealer event in three years, due to financial turmoil, ownership changes and a dearth of new products.
"New products really help you sell and we've been a long time without any," said Alan Helfman of River Oaks Chrysler in Houston, Texas.
Chrysler is launching 15 new or significantly updated vehicles in the next four months, in keeping with the product plan outlined last November. At that time, the automaker said it would refresh 75 percent of the product lineup by the end of this year.
Chrysler is banking on the product parade to meet its sales forecast of 1.6 million vehicles in 2011, up from 931,000 in 2009, and generate a net profit next year of $1.6 billion to $2.4 billion.
Chrysler has cut costs, but needs revenue from fresh products to repay $8 billion in government loans by 2014 and to build investment-grade value to become a publicly traded company in the next couple years.
Chrysler has launched multiple vehicles in a single year before -- but not all bunched in a quarter, said Dan Knott, purchasing chief and part of a six-member "industrial leadership team" orchestrating the launches.
Automakers like to spread launches to better concentrate on each separately, and spread out the cost and disruption. Chrysler didn't have that luxury.
When Marchionne took over as Chrysler CEO in June 2009, he discovered product development had all but ceased.
The carmaker did what it could this year by repackaging existing models and creating new trim levels, but dismal sales in the early months reflected the outdated showroom.
Going from famine to feast is not easy and Chrysler has the added albatross of its reputation for poor quality.
"The last thing you want to do is rush things today," said Joe Phillippi, analyst with AutoTrends Consulting Inc. in Short Hills, N.J. "That's how you end up with recalls."
He said if the Grand Cherokee is any indication, "We're expecting to see a significant increase in the level of the fit and finish (how well the parts fit together) and for Chrysler to get rid of hard, scratchy plastic in the interior and improve their engines, all of which is really important."
Ensuring quality while juggling so many simultaneous vehicle launches requires a lot of planning and anticipating pitfalls, said Rebecca Lindland, director of auto industry research for IHS Automotive in Lexington, Mass.
"Managing the launches means managing the disasters and the challenges, anticipating problems and being able to right them quickly," she said.
Marchionne has made it clear there is no room for error.
Said Knott: "We will not send a vehicle to a customer unless it is flawless." The team gathers daily at 8 a.m. and anyone can pop in for quick problem resolution.
Each leader has adopted a "godfather role" for the vehicles being launched.
Godfathers meet weekly, often at a plant. Last week, they went to the Brampton, Ontario, plant that will launch the all-new Dodge Charger the last week of November; it will be followed by the new Chrysler 300 in mid-December.
The week before, the team was in Toluca, Mexico, to check on the Dodge Journey and preparations to add Fiat 500 production there in December.
Knott said processes were tested and honed leading up to the May production launch of the 2011 Jeep Grand Cherokee at the Jefferson North plant in Detroit.
Preparations included working closely with suppliers, many of whom need to add production capacity and workers.
Dealers are excited to see the new products in Orlando -- those who are registered represent 90 percent of Chrysler's sales volume.
"I can't wait to see all the new models," Helfman said. "We will have more assets to work with and we'll come back fighting."
First out was the Grand Cherokee in June; the larger Dodge Durango follows in November. The Toledo-built Jeep Wrangler is headed to dealers now.
November will be especially busy. Major upgrades are coming for minivans, the Chrysler Sebring and Dodge Avenger and Journey midsize vehicles, and the Jeep Patriot and Compass
"Dealers are feeling better all the time about Chrysler," said Wes Lutz, owner of Extreme Dodge Chrysler Jeep in Jackson.
"It's always nice to share information with the people you depend on to sell your product. It shows you have a future."