Sergio's Plea For Optimism
There are plenty of reasons to believe that Chrysler will not survive, let alone thrive the way the firm’s five-year plan foresees, but one of them does not appear to be Sergio Marchionne’s leadership. Though there’s doubtless a good deal of hubris in his plan, Marchionne’s depth of knowledge, personal experience and legendary workaholism seem to indicate that, if nothing else, Chrysler’s leadership is lightyears away from the Bob Nardelli years. Considering he oversaw a turnaround of Fiat that was only slightly less improbable than his current turnaround mission, he’s about as qualified to take on the mess in Auburn Hills as anyone else. Here are his closing remarks from the seven-hour product and business plan event.
[powerpress]
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Tricky Dicky This was no 'Cry God for Harry, England, and Saint George!' speech. Not even close. Not in the same ballpark, city, state, country, continent or planet. Now here's a guy who knows to sell, sell, sell. http://www.youtube.com/watch?v=M3s3UVVe5Z0
If you crunch the numbers, you can see that the strategy is to move somewhat down market, while pumping up the volume and expanding internationally (presumably Latin America.) The goal is to more than double sales by 2014, while actually reducing the average price point, before even adjusting for inflation. Read between the lines, and that means more production outside the US. That may be a combination of more production in Mexico, and with Chrysler buying federalized vehicles from Fiat that would presumably allow Fiat to better utilize its capacity. Mr. Marchionne has more turnaround experience with car companies than I do, so I'm inclined to give him his due. Still, I'm skeptical of a plan that calls for such aggressive sales growth. Assuming that production matches these ambitious sales expectations, fleet sales will likely be a substantial part of their future, so the costs had better be contained. Interestingly, Chrysler's main rival will be Hyundai-Kia, as both will be targeting many of the same price points and will most likely end up fighting over the fleet market in order to use up their capacity. Fiat's plan is to keep fleet sales stable as a percentage of total sales, but I can't see how that could possibly happen.
@Kory815 My parents and I have owned nothing but Chryslers our whole lives (buy what we build) and I can honestly tell you that we have NEVER had so many things go wrong with a car like that. They have all been very dependable. Cheap Daimler-induced interiors aside on the newer cars, the only real issue we've ever experienced has been failure of the 41TE (and others in that family of transmissions) transmission. I agree it's been Chrysler's biggest issue and is a complete piece of garbage. But that will FINALLY change soon.
@Kory815 I had a co-worker whose Dodge Caliber was stuck in park only 3 weeks off the lot. We all lined up to try and play Arthur pulling the ExCaliber of gear shifts in hope that one of us was destined to unclench it. Alas, none was sucessful. She called a tow truck, the dealership, and her husband - in that order - and when the tow truck arrived she gave it one last try the damn thing moved like there was never a problem. I have a new slogan for Marchionne: "Chrysler. You get what you pay for."