Chrysler Corporation LLC

Grand Cherokee will get axles from new plant

Chrysler LLC is lining up equipment and business for its planned Marysville, Mich., axle plant as it continues to search for an investment partner in the operation. Chrysler intends to begin installing axle-making equipment at the plant Oct. 1, said Chrysler spokesman Dave Elshoff. The $700 million plant is scheduled to begin production in 2010. One of its first orders will be the axles for the... [SUB] 12:01 am U.S. ET | Sept. 8

Press: Chrysler is pushing forward on electric cars

This month, Chrysler LLC will show auto dealers prototypes of three electric cars that can be produced, says co-President Jim Press. "We are making substantial pro-gress on electrification of our vehicles," he said here last week during a Motor Press Guild luncheon. FULL STORY [SUB]

Chrysler Financial hikes dealer floorplan fees

A month after its sudden withdrawal from the leasing business, Chrysler Financial has told dealers that it will jack up their floorplan interest rates and force them to pay off older, unsold vehicles. In an Aug. 27 letter to dealers, Chrysler Financial CEO Thomas Gilman called the moves "unprecedented actions for unprecedented times." FULL STORY

Chrysler sues consultant over sourcing

Chrysler LLC purchasing chief John Campi, fed up with the carmaker's failed sourcing effort in low-cost countries, is suing the consulting firm hired to find cheaper suppliers. Chrysler paid at least $7.7 million to Accenture for help buying parts in low-cost countries such as China and India. Chrysler thought doing so would save $900 million. FULL STORY

Vice Chairman/President Jim Press Talks About Chrysler's Strategy ...

Autochannel (press release) - USA

SAN FRANCISCO - September 8, 2008: One of the auto industry's most respected and well liked executives is Jim Press. Now a Chrysler Vice Chairman and ...

http://www.theautochannel.com/F/news/2008/09/08/098859.html

Fenton plant prospects wedded to 2009 Ram

(St. Louis Post-Dispatch (KRT) Via Acquire Media NewsEdge) Sep. 8--About 1,100 workers left at Chrysler's pickup plant in Fenton are walking what amounts to a manufacturing tightrope.

The situation will not get better: Chrysler has said it has no plans to bring back the second shift, or about 900 workers, that the automaker cut this month.

And it can get worse. Plummeting sales of the Dodge Ram pickup could push off-balance what the automaker makes versus what it sells, and thus endanger the Fenton plant. Tumbling sales already spurred Chrysler to close the adjacent minivan plant at the end of next month.The stakes -- and the challenges -- are high this year for the 2009 Dodge Ram.

Gasoline prices that topped $4 a gallon nationally in the summer left consumers wary of driving gas-guzzling sport utility vehicles and pickups. The weak economy tightened consumer spending. Plus, the housing slump has battered construction companies, which are among the chief buyers of these big pickups.

These are factors that Chrysler and the other automakers acknowledge, but despite those troubles, Chrysler is confident in the 2009 Ram.

What's driving that enthusiasm is the redesign of the Ram 1500 pickup -- the first major redesign since the 2002 model. Chrysler said the redesigned full-size pickup should officially roll off the Fenton plant's assembly line today and trickle into St. Louis dealerships and others across the nation later this month.

"This isn't just a warmed-over refresh," said Mike Accavitti, director of Dodge marketing.

The redesigned 1500 model -- built in Fenton and Warren, Mich. -- uses a different rear suspension than other full-size pickups, giving it more of a car-like smooth drive. And a new version, a crew cab model with two full-size rear doors, joins the standard and quad cab versions already being made.

"We are introducing a truck that we don't have in the marketplace," Accavitti said. "Crew cabs have grown since 2002 from nothing to 50 percent of (overall pickup sales) ... There's where we will increase our market share initially and where we will increase our market share in the long haul."

The larger Ram pickups, such as the 2500, are not part of the redesign. These larger pickups are built in Fenton and Saltillo, Mexico.

Ford Motor Co. said in June that it would delay the launching of its redesigned F-150 by about two months because of slow truck sales and the need to sell down 2008 inventory. But Accavitti said Chrysler has gone ahead with its launching because it cleared out much of its 2008 inventory using incentives. The automaker has less than three months worth of last year's Rams, or fewer than 30,000 pickups, he said.

"We're in a better inventory position than the other guys," Accavitti said.

Still, hefty incentives on the 2008 Ram 1500 could cannibalize the 2009 model, said Jessica Caldwell, an industry analyst for auto information website Edmunds.com. She added that the automaker might be forced to offer incentives on the 2009 Ram. Chrysler would only say it is evaluating its incentive strategy for the new model.

RIVAL F-150

Competition is fierce in the full-size pickup segment, which includes competitors such as the Chevrolet Silverado, the Toyota Tundra and the Nissan Titan.

Tracy Handler, a market analyst for research firm Global Insight, said the 2009 Ram 1500 will get some extra market share when it launches. Those sales, she said, could come at the expense of Chevy sales because the last redesign for the Silverado was in the 2007 model year.

Chrysler's decision to go ahead with the launching when Ford delayed its own also could help the Ram's sales compared with that of the F-150, she said.

Ford spokeswoman Afaf Farah said Ford does not have excessive 2008 inventory now and is confident in its new model.

Once the F-150 arrives in late fall, the Ram might lose some market share back to the Ford pickup, said Art Spinella, president of consumer research firm CNW Research.

Pickup buyers tend to have a strong loyalty to one of the automakers and rarely cross over to another maker. Ford has consistently targeted contractors and recreational vehicle owners who tow those vehicles, Spinella said, while the Dodge Ram saw its biggest sales just a few years ago when consumers known as "appearance buyers" perceived pickups as status vehicles.

"It's not likely that many of these appearance buyers will come back to market," he said. "The people who use pickups for work-related (purposes) are coming back to market, and they're very pro-Ford and pro-Chevy."

With analysts predicting lower sales this year, pickup makers will be fighting for a smaller pie.

Handler said peak pickup sales were about 2.5 million three years ago, with about 25 percent of buyers being the "appearance" consumers. She said her firm expects pickup sales to be about 1.5 million for the next few years.

According to Global Insight, Chrysler is expected to sell about 260,000 Dodge Rams in the United States in 2008 and about the same in 2009 -- down 27 percent from 2007's actual sales.

Capturing sales, then, depends on how well the automaker markets the Ram to those who need trucks for work, Spinella said.

That's what Chrysler plans to do, Accavitti said. Although it will still reach out to what it calls the "casual" buyers, most of the marketing will target the ranchers and contractors, owners of recreational vehicles, and people who use their vehicle for both work and personal driving.

PLANT SHIFTS?

A steady decline in sales meant Chrysler didn't need to make as many pickups at its three Ram plants. The excess capacity led the automaker to eliminate one shift in Fenton.

Right now, Chrysler doesn't see the need for a second shift.

"It's important that the elimination of the second shift at the (Fenton) North plant be considered permanent," spokesman Ed Saenz said.

Although stronger than expected Ram sales won't mean the return of a second shift for Fenton, the local plant may be in peril if sales go further south.

If there is a sharp decline in pickup sales this year, there could be enough extra capacity in the Warren, Mich., plant to cut the remaining Fenton shift and consolidate production of the Ram 1500 to the Detroit-area location, said Greg Gardner, an analyst for Oliver Wyman, publisher of the Harbour Report that tracks auto plant productivity.

Saenz said he wouldn't speculate on whether a drop would warrant cutting the remaining St. Louis shift.

Although running a plant with one shift is considered inefficient, Saenz said Chrysler has other plants in Sterling Heights, Mich., and Detroit that operate on one shift. He said people should not speculate that those plants, and the operations in Fenton, will be closed just because of their one-shift schedules.

Where's the hybrid?

'09 Dodge Ram won't get one for a while

By J. P. VETTRAINO AND BOB GRITZINGER

SPECS

ON SALE: Now
BASE PRICE: $22,170
DRIVETRAIN: 3.7-liter, 215-hp, 235-lb-ft V6; RWD, four-speed automatic
CURB WEIGHT: 4,525 lb
0-60 MPH: N/A
FUEL ECONOMY (EPA): 17 mpg

The new 2009 Dodge Ram pick-up is loaded with genuine improvements, starting with aerodynamic and powertrain efficiencies that increase fuel economy 5 percent on average. What it doesn't have, at least initially, is the dual-mode hybrid powertrain arriving now in the Chrysler Aspen and Dodge Durango sport-utility vehicles. That is at least a mild surprise.

Nor will the Ram debut with a next-generation diesel engine. Dodge promises both the hybrid and a new diesel "sometime after 2009," and given the market's sudden thirst for more fuel-efficient vehicles, a reasonable question arises: Why wait?

"It's kind of like trying to cover every bet on a roulette wheel," says Joe Veltri, Dodge director of truck marketing. "No one has the money it takes to cover every possibility at launch. If you want to execute a well-designed product with maximum quality, you have to set some priorities. We set our priorities, and we're pretty happy with the [Ram] product mix."

The new turbodiesel, being developed with longtime partner Cummins, won't be reserved for heavy-duty trucks. Dodge hopes to have the Ram's 50-state-legal diesel ready for showrooms before the hybrid.

"Every study we've seen suggests that in every other segment, buyers want hybrids more than they want diesels," Veltri says. "In pickups, they want diesels more than hybrids. I think that's a function of familiarity with diesel technology and a comfort level among truck buyers."

The Ram hybrid's powertrain will be essentially identical to that in the Aspen and the Durango: a Hemi and the dual-mode variable automatic transmission, with two integrated electric motors. Developed jointly by BMW, General Motors and former Chrysler parent Daimler, the dual-mode hybrid typically increases mileage ratings 40 percent in city driving and 25 percent overall.

What the redesigned and reengineered Ram does get for 2009 is a plethora of new features, starting with a softer-riding rear coil-spring suspension (versus traditional leaf springs). Chrysler engineers say the truck maintains the same load-carrying capacity, but the coil setup reduces lateral movement to help keep the rear end more planted, especially when driven unloaded. In our test drives, the truck exhibited surprisingly little body roll, rear skate seemed minimal, and the head toss usually noted in high-strung pickups was low, despite driving the truck with an empty cargo bed.

"The idea was to provide the same drive quality, loaded or unloaded," says Ram engineer Steve Williams.

The Ram's 5.7-liter Hemi V8 gets an upgrade that boosts output to 390 hp and 407 lb-ft of torque, up from 345 hp and 375 lb-ft. The multi-displacement system is retuned to allow the engine to operate in fuel-saving four-cylinder mode across a wider rpm range. Brakes are improved to reduce dead space in the pedal stroke.

In addition to adding a weight-saving aluminum hood, design chief Ralph Gilles also lowered the front end, tightened wheel-well openings and extended the side sills to reduce aerodynamic drag. While the truck's overall size is slightly smaller, it appears bigger and bolder than ever.

Cool new features include RamBox weatherproof, lockable bins integrated into the bed sides and in-floor storage bins.

Retail prices for the 2009 Dodge Ram 1500 range from $22,170 for a regular-cab V6 4x2 in base ST trim to $44,140 for a Hemi-powered Ram Crew 4x4 in luxo Laramie trim. Prices include a $900 destination fee.