At about the same time Barack Obama was figuring out where to store his paper clips and Post-it notes in the Oval Office, Fiat S.p.A. and Chrysler LLC were busy trying to inaugurate a new partnership that almost no one saw coming.
News that Fiat will take a 35-percent stake in struggling Chrysler (the majority of which is owned by Cerberus Capital Management) could not come at a better time. If any of Detroit’s Big Three would fall, Chrysler would be the first, and this alliance at least gives the Pentastar a glint of hope for survival. A dearth of new product suggested that Chrysler was merely buying time before the creditors came knocking or its government loan money ran dry. Even with the $4 billion it received last month from the U.S. government, Chrysler’s near-term prospects for recovery appeared slim to none.
Some might say they still appear that way. With little in the way of global sales to generate cash flow—unlike, say, GM—Chrysler’s lackluster U.S. lineup looks even more dire. Why, for example, the company ever thought it could replace the Neon compact with a chunky-looking, off-roader wannabe like the Dodge Caliber is beyond us. At best, you could maybe say that the Caliber is better to drive than the old Neon, although that wouldn’t be saying much. But the Caliber’s aggressive mini-SUV looks will always make it a bit player compared to more conventionally styled segment leaders such as the Honda Civic or Toyota Corolla.
So if Chrysler survives and Fiat’s current crop of cars is good to go in terms of meeting U.S. crash and emissions regulations, what will a Fiat/Chrysler union look like? And, most important, what can we expect in terms of how this might impact each company’s approach to the U.S. market? Using a little educated guesswork, not to mention some old-fashioned crystal-ball gazing, we offer some ideas as to what the future holds for each company’s chances of U.S. sales success. Luckily for Chrysler, Fiat has been on a roll recently when it comes to building highly desirable products.
Competitive city cars are one of the things that Chrysler desperately needs if it hopes to survive long—especially if it wants to jump-start global sales. It’s good, then, that Fiat has one of the best in the 500, which follows the lead of other retro-themed small cars like the Volkswagen New Beetle and BMW’s Mini. Stylistic inspiration came from the original 500, produced from 1957 to 1975. The 500 is based on the same vehicle platform as the Fiat Panda city car. Our guess is that the boxy and functional Panda will remain in Europe. It’s simply too small and, in most forms, far too slow for American car buyers.
However, it’s an open secret that Fiat would love to market the hot-selling 500 in the U.S.—not to mention relaunch Alfa Romeo in America by 2011, a task potentially made easier with access to Chrysler’s existing dealer network. If the diminutive 500 comes to the U.S., bet on something like the optional 100-hp, 1.4-liter 16-valve gasoline four-cylinder finding its way under the hood. A 158-hp four-cylinder is offered in the sporty 500 Abarth model. In Europe, a wide range of water-cooled engines are found under the 500’s stubby nose, including a 69-hp, 1.2-liter gasoline engine and a frugal, 75-hp 1.3-liter turbo-diesel.
The 500 could help launch Fiat’s reentry into the U.S. market, and provide a solid base upon which Chrysler could build a similar (and likely lower-priced) city-mobile to take on the likes of the Toyota Yaris and Honda Fit. One small snag is that Fiat also shares the 500’s platform with Ford Motor Company, who used it to produce the latest Ford Ka city car. U.S. sales have been rumored for the Ka, although nothing has been finalized. Should the little Ford reach our shores, though, you can bet the Blue Oval would raise a stink in an attempt to keep a Chrysler-fied 500 from reaching market.
A step up in size and stature from the Panda and 500, the Grande Punto hatchback is handsome, well-built, and economical. Basically, it’s everything Fiats weren’t for way too long—one of the reasons Fiat (Fix It Again, Tony!) abandoned the American market a quarter-century ago. A range of frugal but fun gasoline-fired engines (from a fuel-sipping 64-hp, 1.2-liter four-banger to the tire-smoking 178-hp four found in the Abarth SS model) would satisfy enthusiasts and tree-huggers alike.
Don’t discount the wide range of Multijet diesel engines Fiat also has on offer. They’re an invaluable asset for any company that hopes to crack the European market. Fiat has plenty of decent diesel engines ranging from 1.3 to 3.0 liters, and it’s almost certain that, if Chrysler is serious about European sales, Fiat-built diesels will eventually find their way under Dodge, Jeep, and Chrysler hoods.
As for the Grande Punto, it’s sized to compete with cars such as the Ford Focus and VW Golf. The three- or five-door Grande Punto could stand a good chance at showing up in Chrysler or Dodge form. Our guess is that this would be delayed until the next freshening of the now nearly five-year-old model. Chrysler would also likely want a sedan body style, since Americans have never really warmed up to hatchbacks.
The Fiat Linea is basically a Fiat Bravo sedan. The Grande Punto and slightly larger Bravo hatchback, along with the Linea sedan, are all built on the Gamma platform, which was co-developed with General Motors during the companies’ ill-fated joint venture, which dissolved in 2005 but ended up providing Fiat with a much-needed $2 billion cash infusion.
As a small family car, the Linea would slot beneath the woeful Chrysler Sebring sedan. Helping the Linea’s case is the fact that it’s one of the most worldly of Fiat’s current offerings, especially in terms of where it’s pieced together. In addition to production sites in Brazil and Turkey, Fiat now builds the Linea at a new factory in Ranjangaon, India. The plant will have the capability of producing upwards of 200,000 vehicles per year, which is more than the Indian market could ever absorb. Remaining cars will be exported to markets in Europe or, thanks to the Fiat/Chrysler tie-up, perhaps to the U.S. However, there’s a problem: the Linea just isn’t large enough to compete in the fiercely contested U.S. mid-size market.
This is where Chrysler could come to the aid of Fiat—not to mention Fiat’s partner in India, Tata Motors. Chrysler has a wide range of large and heavy-duty pickups and SUVs in its product portfolio, along with decades of expertise in the American minivan market. Even Volkswagen thinks enough of Chrysler’s latest crop of minivans that the German manufacturer rebadges them and sells them as the VW Routan. (There’s been no news as to whether this agreement—or the deal to supply Nissan with Ram-based pickups—is in any jeopardy due to the link with Fiat.)
Based on the same platform as the Grande Punto, the recently introduced Fiat Qubo is a small and funky-looking multipurpose van. This is probably the only Fiat van that stands a chance at coming to the U.S. In terms of Fiat’s larger vans, such as the aging Multipla and Doblo, Fiat would be wise to redesign them using hardware donated from Chrysler’s more modern minivan stable.
Chrysler engineering could eventually also find its way into Tata Motors vehicles. The new Ranjangaon factory is a 50/50 venture between Fiat and Tata. Chrysler already had an agreement to build electric-powered versions of the Tata Ace (a small commercial vehicle) for the American market. Could Chrysler’s larger truck technology appear in, say, the next Tata Grande Sumo or Safari SUV? It’s much less far-fetched than, say, rumors that the $2100 Tata Nano could come to the States anytime soon.
Ferrari parts appearing in a Chrysler is totally out of the question. That point was made abundantly clear in the press release announcing Fiat/Chrysler cooperation. This doesn’t mean that some clever parts-sharing and cost-cutting couldn’t be done with Fiat’s other sport-luxury brands, Maserati and Alfa Romeo. True, the last liaison between Chrysler and Maserati resulted in the laughably tacky and awful-to-drive Chrysler TC (Touring Coupe) by Maserati. That monstrosity lasted only from 1989 to 1991.
A Chrysler exotic looks highly unlikely, especially considering that the company is trying to sell the Viper brand. But who’s to say that Chrysler LX parts (the platform beneath the 300C and Dodge Charger) couldn’t underpin next-gen Alfa Romeo products? Current Alfas are saddled with a front-wheel-drive layout (except the exotic 8C Competizione) when all their rivals are rear-wheel drive. On the other hand, through Tata (via the Fiat/Tata romance; Tata now owns both Jaguar and Land Rover), Maserati could be using Jaguar underpinnings for its next-generation rear-drive architecture. And could some Jag bits find their way into Chryslers? We can’t rule it out for sure.
Whatever ends up happening, any products stemming directly from a Chrysler/Fiat marriage—the agreement won’t be finalized until April or so—likely won’t come to fruition for at least three years, if not a lot longer. This is going to be mighty interesting.
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