Chrysler success 5 years since near-collapse means 5 more years of work

Article by Christian A., on April 30, 2014

Chrysler Group chief executive Sergio Marchionne is bound to detail the carmaker's five-year product and business plan on May 6, and that would mean five more years of tough effort even after the company successfully warded off financial collapse in 2009. The plan is expected to address three areas of concern – fuel economy, earnings and production capacity.

Chrysler’s current fleet mileage as well as profit margins are far behind from those of its major rivals in the in the United States like Ford Motor Co. and General Motors. Likewise, Chrysler sites have already reached their full production capacity for key vehicles like Jeeps and some Ram full-sized pickups.

The new product and business plan would probably address hindrances that have been Chrysler’s worries like its corporate average fuel economy for domestic cars that ranked lowest among the largest carmakers in the US in 2013 at 32.1 mpg. Also its position among light-truck carmaker is only slightly more competitive.

Chrysler is also behind some carmakers in electric vehicle sales. The carmaker’s profit margin in 2013 is only 3.9 percent of revenues, far behind its local rivals – GM and Ford posted profit margins of 7.8 percent 9.9 percent, respectively.

Chrysler is being integrated into 100-percent parent Fiat, with the new company to be named as Fiat Chrysler Automobiles (FCA). FCA has set aggressive global sales targets for both Jeep and Alfa Romeo, but has find ways to achieve them.

While Jeep is aiming to deliver at least 1 million units this and post further growth, output of its Grand Cherokee and Wrangler SUVs has already reached maximum capacity. On the other hand, Alfa Romeo don’t have enough products to achieve its global sales potential. [source: automotive news - sub. required]

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