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2016 Chrysler 200 C and 2016 Dodge Dart Limited (Photo: A.J. Mueller, FCA US)
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Fiat Chrysler Automobiles CEO Sergio Marchionne said today that the Dodge Dart and Chrysler 200 sedans will eventually be discontinued as the automaker refocuses its efforts on the production of its popular Jeep SUVs, Ram pickups and boosting its electric vehicle lineup.
Marchionne said the strategy is a response to market trends in the U.S. that include gas prices that have dropped to about $2 per gallon and a shift in buying patterns among Americans back to crossovers and trucks instead of cars.
The strategy also is designed to help the automaker boost production capacity for Ram and Jeep and suggests that the company will move the production of some of those models to other plants. Currently, the company cannot make enough Jeep Cherokees and Jeep Wranglers to meet demand and also struggles to make enough Ram pickups.
"We have decided to de-focus, from the manufacturing standpoint, to de-focus on the passenger car market. There are two cars in particular, the Dodge Dart and Chrysler 200, which will run their course," Marchionne said during a conference call with Wall Street analysts on Wednesday. "Without creating additional capacity, in the United States, we need to ... to try and deal with the development of both Jeep and the Ram brand."
The news is stunning, given the investments made to develop the Dart and the Chrysler 200. The automaker invested more than $1 billion to overhaul its Sterling Heights Assembly Plant to build an all-new Chrysler 200 midsize sedan that launched in 2014 and spent $600 million to launch the Dart compact car in 2012. To be fair, many of the improvements made at both plants help the automaker build any vehicle.
The Dart failed to meet sales expectations. It is among the larger compact cars on the market and is priced higher than competitors. Just over 87,000 were sold last year. The Chrysler 200 has been praised for its exterior styling and is viewed as a competitive car in its segment but has cramped rear seats.
Marchionne hinted that the Dart and Chrysler 200 could return to the market if FCA found another manufacturer willing to build the cars.
The automaker now is aiming to sell more than 2 million Jeeps globally by 2018, an increase from its prior target of 1.9 million annual sales. FCA sold more than 1.2 million Jeep SUVs globally in 2015 -- the most in the history of the brand.
While the strategy will help FCA find additional capacity for its most popular vehicles, it also positions the company as largely a manufacturer of trucks and SUVs. Removing small cars from the lineup leaves FCA vulnerable to gas price increases in the future.
Marchionne said decisions have been made to help the company achieve the production capacity it needs for Ram and Jeep. A number of plans will be put in place over the next 18 months, but he but did not outline those plans.
The Chrysler 200 is made in Sterling Heights and the Dodge Dart is made in Belvidere, Ill. The Free Press, along with a number of other publications, have previously reported that the automaker plans to move production of its Ram pickup to Sterling Heights and move its Jeep Cherokee to Belvidere, Ill. It also is expected that the Jeep Grand Wagoneer will be built at Warren Truck.
The automaker has said it will launch its next-generation Jeep Wrangler in 2017, and will make the Wrangler in Toledo in the plant where the Cherokee is currently made. The company has not said what vehicle it will produce in plant in Toledo where the Wrangler is currently made.
“I think the important thing for us to reinforce is the fact that the Wrangler, in its new home in Toledo, will have additional production capacity available to try and meet demand on a global scale, and I think it’s important for us to have found a home for the Grand Wagoneer family, both the Grand Wagoneer and the Wagoneer in whatever shape they come," Marchionne said.
There are also plans to add diesel and hybrid electric versions of the next-generation Jeep Wrangler when it goes on sale by 2018. The company also plans to offer "next-generation powertrains" on its next Ram pickup and produce a mild hybrid version of its Ram pickup.
Source;
http://www.freep.com/story/money/cars/chrysler/2016/01/27/fca-build-more-jeeps-rams-under-new-production-plan/79393200/
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