Thursday, March 13, 2008

DETROIT — Of the big American car companies, Chrysler has a well-earned reputation for extravagant marketing stunts.

Skip to next paragraph


Rough RoadGraphic

Rough Road

Stan Honda/Agence France-Presse — Getty Images

The 2009 Dodge Ram pickup in a promotion at the Detroit auto show in January. James E. Press, Chrysler’s vice chairman, hopes the automaker will be remembered more for its vehicles.

The debut of the new Dodge Ram at the Detroit auto show in January was typically over the top, as cowboys on horseback herded 120 head of cattle through the city to publicize the rugged appeal of the pickup.

Chrysler’s new vice chairman, James E. Press, gamely played his part in a western-style jacket. “If you think that our truck is all hat and no cattle, keep an eye on yonder horizon,” he said to an audience chewing on beef jerky branded with the Dodge logo.

But Mr. Press, a veteran of 37 years with Toyota who distinguished himself as a serious salesman of sensible Camrys and Corollas, was visibly uncomfortable in the role. He acknowledged as much in a later interview as he discussed how Chrysler must change to survive.

“We need to be focusing more on the substance and less on sizzle,” he said. “Instead of being remembered for cattle, you’d like the Ram truck to be remembered for winning the showdown with the Ford F-150.”

Mr. Press surprised the industry last year when he left Toyota, where he had been a board member and the company’s highest-ranking American executive, to join Chrysler, smallest of the troubled Detroit Big Three automakers.

Steeped in Toyota’s customer-driven culture of continuous improvement, Mr. Press, 61, had been the steady hand behind the Japanese company’s methodical expansion in the United States. Now as Chrysler‘s vice chairman and president, Mr. Press is trying to bring stability to a company known for stomach-churning roller-coaster rides through boom and bust cycles — from the government-loan bailout in the late 1970s under Lee Iacocca to its failed marriage with German automaker Daimler-Benz.

Mr. Press clearly wants to improve Chrysler’s erratic image, whether he’s visiting dealerships, holding town hall meetings with employees, or answering e-mail messages from consumers.

At a seminar last month at the Levin Institute, an education and research institution in New York, he fielded questions about Chrysler’s struggles by comparing it with a certain Japanese juggernaut. “In some ways it reminds me a lot of what Toyota was when I went there more than 30 years ago,” he said.

But with a dwindling market share at home and a minuscule presence internationally, Chrysler may be running out of comebacks. Saddled with a model lineup that is heavy on gas-thirsty trucks, Chrysler lost $1.6 billion last year, leading to the breakup of its ill-fated, eight-year-long union with Daimler.

Then last August, the private equity firm Cerberus Capital Management bought an 80 percent stake in Chrysler at the fire-sale price of $7.5 billion and immediately began cutting jobs and costs.

Cerberus brought in the former chairman of Home Depot, Robert L. Nardelli, to oversee the reorganization as Chrysler’s chairman, and then hired Mr. Press to overhaul its products and invigorate its sales and marketing.

“What the consumers are really interested in are the facts, the details, the bottom line,” said Mr. Press. “We’re going to have a very effective product line that will do the talking for us.”

That’s a tall order, even for an executive with Mr. Press’s experience. Chrysler’s sales in the United States have slid 13 percent so far this year, and its vehicles lag in head-to-head comparisons with rival automakers. Consumer Reports magazine recently ranked four Chrysler vehicles among its 10 worst cars sold in the United States.

Industry observers wonder where Chrysler fits in an overcrowded market led by General Motors, Toyota and the Ford Motor Company, which are much larger companies with far greater resources than privately held Chrysler.

“I view it as mission impossible,” said Jack Trout, president of the marketing strategy firm Trout & Partners. “Chrysler is such a distant fourth, and it lacks an identity. I mean, what is a Chrysler?”

What Chrysler is now is a shrinking entity with a 13 percent share of the American market and international sales of less than 250,000 vehicles a year, excluding Mexico and Canada.

Mr. Press says that Chrysler’s size can be an advantage if it can more quickly respond to changing consumer tastes. Its goal, he said, is for Chrysler to be the “best little car company in America,” with global sales of about three million vehicles, less than a third of what G.M. and Toyota sell.

Last month, Mr. Press announced Chrysler’s “Project Genesis” plans to its American dealers, which calls for reducing its current lineup of about 30 models and consolidating Chrysler, Jeep and Dodge franchises nationwide. The automaker had already announced plans to trim slow-selling models like the Chrysler Pacifica crossover vehicle and the Dodge Magnum wagon.

“When I first came to the company, the orientation was about wholesaling cars to the dealers as opposed to retailing cars,” Mr. Press said. “That change has occurred, and now we can be responsive to what out customers want.”

No comments: