Chrysler Rebuffed Hyundai Ram Rebadge Offer, Deal Still Possible?
Hyundai made a proposal to Chrysler earlier this year under which the U.S. automaker would build a truck for Hyundai based on Chrysler’s Ram truck platform… Chrysler Chief Executive Sergio Marchionne rebuffed Hyundai’s initial approach in February… saying the automaker needs to focus on its established turnaround plans under Fiat SpA. But Hyundai continues to look at truck options and could come back to Chrysler, according to two of those with knowledge of the talks, who were not authorized to discuss the matter because the closed-door discussions were preliminary.
Ram sales were down 23 percent last month, down 20 percent calendar-year-to-date, and down 24.3 percent in rolling 12-month totals. Hyundai is doing just fine without a pickup. Chrysler may have been crazy to turn down a shot at easy volume (that might have gone to Nissan), but Hyundai would be crazier still to ask a second time. After all, Volkswagen’s Chrysler rebadge, the Routan minivan, has sold only 14,580 units in the last 12 months.
I'm sure they market research but I just can't figure out who would buy this. I would think most Hyundai shoppers don't have the budget for a full size truck. Unless they plan to stock a bunch of standard cab, V6 powered, 2WD base models. But no one buys those anymore. Everyone wants them loaded up with all the goodies.
What about the idea that there are areas in the U.S. where one may find a Hyundai dealer, but not a Chrysler? So if the local Hyundai store has pickups, perhaps the truck shopper will come in, try out a truck and return one day for a higher-margin sedan or econocar. I dunno, this makes sense to me. But then again, so did the idea of Chryser becoming a contract-manufacturer for anyone else back when Cerberus was running the joint.
This is a brilliant move by Hyundai, really. Just like Genesis, Equus -- they are putting a toe in the water, to learn about the market, buyers, and just, quite frankly, to get started. It doesn't need to be a rousing sales success or even close to perfect. In 5 years (sooner?) they'll likely have their own platform -- this will give them say, 5 years of experience. That's a good thing for the dealers, even greater for the brand.
Seems to me this is more about the messaging than the motoring. "We gonna slap a huge slanted oval H on a monster big truck, and sell it for a gud price. Then y'all are invited for some Bar-B-Q down in Montgom-ray, Alabama. We'll drink some beers, watch some college football and talk about how great it is to be American." The original plan was to have you over for some kimchi and noodles to discuss South Korea's chances of winning the World Cup, but that got scrapped.