Fiat S.p.A. plans a drastic change in its distribution activities. First, 350 dealers will be dropped from Chrysler and Lancia European's network.
Then, the Chrysler name will no longer be seen in showrooms across mainland Europe. Under Fiat's plan to only have a single European sales network for the two brands, it notified nearly 1,200 Chrysler and Lancia dealers in Europe that their contracts will end on May 31, 2011.
By 2011, Chrysler cars will be sold under the Lancia badge all over Europe except in the UK and Ireland where Lancia does not sell its cars.
In those countries, the Chrysler name will still be used. About 1,150 Lancia and Chrysler dealers are affected by the cancellations, which will take effect in 12 months in order to meet European Union rules that require giving dealers a year's notice when their contracts are terminated.
In continental Europe, Lancia currently has 595 dealers with 785 showrooms. Lancia has not been selling cars in the UK and Ireland since 1991.
Dodge and Jeep brands are included in the contract of Chrysler, which has 556 dealers with about 750 showrooms.
In response to an inquiry from Automotive News, Chrysler and Lancia CEO Olivier Francois said in an e-mail that the plan is for a Lancia/Chrysler integrated network comprising about 800 dealers and over 1,000 dealerships to be established by May 2011.
Most of the cars of Lancia, Fiat's near-premium brand, sell in its Italian home market. In Europe last year, the brand sold 121,000 new cars, of which 102,000 were purchased in Italy.