The plan for product: Less duplication

Mark Rechtin
Automotive News

SAN FRANCISCO — Chrysler LLC will reshape its product lineup dramatically in the next five years so Chrysler, Dodge and Jeep dealers won't compete against one anotherwith rebadged versions of the same vehicles.

It's all part of a dealership consolidation plan, called Project Genesis, that would result in more stores that sell all three brands.

Chrysler co-President Jim Press said badge-engineered vehicles and single-brand showrooms mean the three brands go up against one another, rather than Ford, Chevrolet and Toyota.

Many products will be deleted, although Press declined to give specifics.

"Do we need 11 SUVs when we sell a million and a half retail?" he asked at the J.D. Power roundtable here. "Maybe we just need three or four."

But Chrysler will add products, too, Press said. For instance, the Chrysler brand might have a minivan for families, while Dodge might get a more rugged vehicle from the same platform geared toward young people.

Badge engineering has wounded the company. The three brands mostly conquest new customers from one another, according to J.D. Power research. Meanwhile, defectors from the individual Chrysler brands frequently go outside the Chrysler fold.

Customer loyalty to the Chrysler brand is only 32 percent — well below the industry average, according to J.D. Power. But those buyers account for nearly half of total sales. That is a recipe for a company in trouble, said Steve Witten, Power's executive director of automotive research.

For every 100 people defecting from Dodge, only 62 new customers are conquested, according to J.D. Power. The research group says that, too, is below the industry average.