Marchionne Straddles the World, Shouting 'Jeeps for Everyone!'

by Steph Willems

Published: May 2nd, 2016

marchionne straddles the world shouting jeeps for everyone

The Jeep brand is Fiat-Chrysler’s biggest money maker, so it’s no wonder that CEO Sergio Marchionne is scattering factories around the world like a sailor’s offspring.

The company’s head honcho outlined his business plan for the brand in an interview published by Automotive News, and it involves no longer having to make a “Sophie’s Choice” decision with Jeep output.

Explosive Jeep sales, coupled with that of Ram, make up for the faltering Dodge and Chrysler brands and allow FCA to post a profit, despite trouble in its small vehicle lineup. However, global demand outstrips existing production capacity, meaning the Jeep-hungry American market gets its fill, while overseas markets get an empty plate.

Building Jeep factories in growing markets gives Marchionne a hedge against domestic uncertainty, and he’s just gotten started laying the bricks.

“One of the things that we’ve always faced in the United States in the production of Jeeps is to make this unfortunate Sophie’s Choice about whether we sell in the U.S. or sell overseas,” Marchionne said, adding. “Even if there were a contraction of the U.S. market, there is in our view unexplored potential in terms of [overseas] markets, especially where we have not established local production.”

The target markets for the Jeep brand are Europe, the Asia-Pacific region and Latin America. Smaller, fuel-efficient models like the Renegade and whatever replaces the Compass/Patriot twins seem tailor-made for those high-growth regions.

Last year, FCA added Jeep Cherokee manufacturing capacity in China and a Renegade production line in Brazil. This year, Renegade production comes to China, with the Compass/Patriot replacement slated for Mexico, China and Brazil.

The three years after that will see Renegade production come to India, and U.S. capacity grown to handle the Wagoneer, Grand Wagoneer, and Wrangler pickup. A sub-Renegade mini-SUV, based on a Fiat platform, might be in the works for the Indian, Indonesian and African markets.

Marchionne wants first-time overseas Jeep buyers to get hooked on the brand, and move up to bigger and more expensive Jeeps as they grow in age and affluence.

If Jeep volume grows the way he hopes, Marchionne won’t have to break a sweat finding someone to make Chrysler 200s and Dodge Darts for him.

[Image: FCA US LLC]

#CarProduction #Cherokee #EmergingMarkets #GlobalBrand #Jeep #JeepCherokee #JeepGrandWagoneer #JeepRenegade #JeepWagoneer #JeepWranger #Sales #Wrangler #ProductPlanning #Renegade #WranglerPickup #OverseasProduction

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Nickoo on May 02, 2016

FCA will not make it past Trump's first term. FCA has had 7 years to develop alternative propulsion (aka hybrid) cars and hasn't done squat. FCA has had 7 years to develop a decent 4 cylinder. FCA has had 7 years to develop a decent transmission. FCA has had 7 years to develop a decent midsizer, a decent compact, a subcompact. FCA's best vehicles are riding on the coat-tails of what is left from Daimler. Everything that turned around chrysler, that was good, came from pre-FCA plans and was developed under Cerberus: Pentastar, 300/Charger/Challenger second gens, viper come-back, new RAM, new JGC, new Durango. Chrysler under Cerberus had the new midsizer in active development, and instead was forced to use CUSW and horrible 9 speed transmissions. Chrysler Corp. could have been a contender. They won't be around in 2020.

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- JohnTaurus on May 02, 2016
  
  So, America's first Hybrid minivan isnt "squat"? The 9 speed auto has overcome its teething (programing) issues. Too soon to tell for the long term, but so far, the repeated failures everyone predicted havent really come about. The 200 is a decent midsizer. It gets more right than it does wrong, but that isnt helping sales. The Dart isnt a terrible car, its just in a field of some very stong compeditors. Most compact sedans (and hatches) are damn good, there arent any rebadged Daewoos (Suzuki), no out-of-date Focus lagging behind the global model, no awful Cobalts, no half-as$$ed Civic, its a bad time to be an also-ran.
  
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- VoGo on May 02, 2016
  
  Trump's first term? Is he going back to college? Can he get into Trump University?
  
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- Nickoo on May 02, 2016
  
  @JohnTaurus I like the Pacifica as a minivan. Although the Kia is still my favorite... I think making the minivan a plug in hybrid is completely ridiculous. The cost/benefit just isn't there. It only has about 20 miles of electric range, it should have just been a regular hybrid, and it should have had a 4 cylinder. Plug in hybrids with less than 50 miles EV range just don't make any sense. You're paying all that extra money and sacrificing all that room taken up by the batteries for only a marginal gain in fuel efficiency which will never repay itself. PHEVs with ridiculously worthless EV ranges are simply cynical cafe specials, and the public has seen them for what they are, judging by their sales.
  
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- Nickoo on May 02, 2016
  
  @VoGo There is no questioning the God-Emperor Trump!
  
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- 28-Cars-Later on May 02, 2016
  
  @nickoo No questioning allowed at all, just as there was no questioning allowed of the Boy King, or of the decades of crime committed by the Bush and Clinton families. That whole silence any dissent thing seems to work out real well for us.
  
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- GeneralMalaise on May 02, 2016
  
  @28-Cars-Later Meh... I dunno, I'm sort of looking forward to anybody but a liberal Democrat in the White House and the inevitable return of "dissent is the highest form of patriotism" schtick.
  
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- Highdesertcat on May 02, 2016
  
  @28-Cars-Later GeneralMalaise, I think Warren Buffett said it best in his interview with Becky Quick today. It doesn't matter who the next POTUS will be because America will just find ways to circumvent bad policy and grow in spite of who is in the White House, albeit grow slower. The current administration was bad for more people and businesses than it was good, so people and corporations detached, sought tax refuges, like inversions, or moved their production out of the US, ala Carrier, et al. That said, I'll again forecast that Hillary will be the next POTUS because every woman in America, including my own, wants to see that first woman POTUS after this go'round.
  
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- Lou_BC on May 03, 2016
  
  @28-Cars-Later "No questioning allowed at all". That is what the Patriot act is for and Snowden seems to have covered the rest. Guantanamo Bay is still available or extraordinary rendition to countries that conveniently ignore human rights (well, ignores them more than we do).
  
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Eyeflyistheeye on May 02, 2016

I rented a compact car for a weekend trip to San Diego on Friday (I live in Los Angeles). After getting an atrocious Mitsubishi Lancer with all of 5500 miles that managed to couple stiff steering and floaty suspension replete with a seat that hurt my back and Bluetooth that wouldn't pair, I went back to Avis and they put me in a 2015 Cherokee Latitude with the 2.4. I liked the Trailhawk I test drove when the KL came out, but I wasn't expecting much from the Latitude. To make a long story short, while I don't miss the opportunity to poke Sergio and FCA for bad business decisions, the Cherokee had enough get up on the highway with five people inside, averaged 25 mpg, the 9HP was fine seeing how I actually know how to modulate throttle input and I didn't miss the handling of my Focus one bit. I wondered why Sergio couldn't build the rest of his lineup like that, then I realized where FCA plunked their money down. And yes, I am very tempted to pull the trigger on a slightly-used Cherokee ($15-$17k) of course with an extended warranty.

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