Ralph Gilles speaks before the Chicago Auto Show 2010

ralph gillesEvery year, the Economic Club of Chicago invites someone from the auto industry to speak at its annual luncheon. This year, Sergio Marchionne was to address the group, and it was widely considered to be a “hot ticket.” Mr. Marchionne ended up having to cancel his appearance, but recruited Ralph Gilles, SVP of Chrysler Group Design and CEO of the Dodge car brand, to take his place.

After the luncheon was served (full disclosure: I got a ticket, wore a suit as required, was served food, and ate it) and a couple of technical hiccups, Mr. Gilles opened with a showing of the “Man’s Last Stand” Charger Super Bowl commercial to great applause. While some have complained that it offended women, the ladies seated at my table (who worked in the banking and investment business) both loved the commercial, saying that “what’s to be offended about?” and “We got it - it’s a great commercial.”

With only 32 hours to prepare, Mr. Gilles was able to put together a not-boring, quote-filled, serious yet humorous discussion of the Chrysler Group - where they were, what happened, and where they are now. Some of the highlights from his discussion that I found memorable:

  • Gilles' fear is that the automobile becomes just a commodity. His job is to make sure that CGLLC products are 'recognized and noticed.'
  • CGLLC wants to reach $5B ebita and $3B in cash by 2014.
  • All government loans are to be paid back in full.
  • The goal is 2.8M unit sales worldwide.
  • 21 new models by 2014; 16 of those in 2010. "New" doesn't always mean "all-new" - 1/3 of the 16 will be "all-new" - the rest are significantly changed and will appear as new to the consumer.
  • Regarding the days of DaimlerChrysler; Gilles said "to talk about it would take hours of time, a couch, and a psychiatrist."
  • "Brands and companies don't die - they are victims of homicide." Like when the owners of your longtime favorite restaurant retire and the new management makes changes that negatively alter the experience.
  • The Alfa Romeo Giulietta is the first product from the new C/D architecture that will be used by CGLLC going forward.
  • "Leadership must BE the culture." If the company's leader is not part of the culture they wish to be in, those under him won't be either.
  • For today's "millennial" buyer, exterior design is only 5% of the reason they consider a certain vehicle. More important to them is how that vehicle fits their life and their needs, and how the car "feels."
  • 2011 Grand Cherokee is expected to be available 3 months from now.
  • 2011 Chrysler 300 is expected to be available in December 2010.
  • Within hours of its' announcement, CGLLC received 1500 orders for the "Furious Fushia" Challengers.
  • Social media will become a bigger part of CGLLC's efforts. Within 3 hours of the "Man's Last Stand" Charger ad being shown during the Super Bowl, there were 'user remixes' of the ad on YouTube and other sites.
  • When asked about "weight versus safety" he noted that new and different types of steel now available can cut almost 200 pounds from a vehicle. He thinks that "cars won't get any heavier than they are today and should be getting lighter as we use more types of these materials."
  • On Sergio Marchionne, the one thing that impresses Gilles the most is his attention to detail.
  • On the government and how they are involving themselves in CGLLC's operations, Gilles noted that "they visit us often and are now aware of and learning more about just how complex the auto business is."
  • When asked what kind of vehicles he drives, Gilles said "a diesel Ram pickup, a Grand Caravan, a Journey, and a Viper."

Ralph Gilles speech

Other notes from the speech (supplied by Allpar members in our forums):

  • Gilles noted that you can’t design for the culture of younger and future buyers if you are not one of them. To that end, his design studios are ”filled with 23-24 year old designers.”
  • On the status of Viper: "Viper important to my brand, Dodge."
  • On what company he thought was doing things right: "I have a lot of respect for Ford. People wrote them off, and they spent 3 years toiling away on what they are showing today and are reaping the rewards - but it’s our turn now."
  • "I want Dodge owners to wave to each other.”
  • On Sergio Marchionne: "the most impressive CEO I have ever met," “he values teamsmanship  - get upset not at mistakes but at not being a team player,” and “Sergio is like an orchestra conductor.”
  • Noted that the traditional Chrysler CEO corner office up on the 15th floor was refused - and abolished - by Marchionne, who has an office on the 4th floor with the engineers.
  • On fuel economy and consumers "We have to keep fighting" for fuel economy for large, midsize and small cars. “If we can offer the cars Americans want with great fuel economy, they’ll buy them.”
  • “Our attitude now is ‘go out and fight.’”
  • On future products: “We'll have a portfolio that can react to the market.”
  • On Chrysler’s future: “I see the light at the end of the tunnel. Never felt better than I do today about the company.”
  • "Fiat, Chrysler - we’re married - now we’re in the honeymoon."
  • On the economy and the industry: "We think that rock bottom was Oct, Nov last year."

What struck me the most during Mr. Gilles’ comments was his enthusiasm - it was infectious, and I got the feeling that Mr. Marchionne is the source of that infection. They know that it’s not going to be easy, and Gilles said that “the folks from the Fiat side are very sympathetic to what’s happening, as they went through a similar circumstance 4 years ago.“

Immediately after the conference ended, I saw a good number of the attendees - remember, these are Economic Club of Chicago members and not “media” people - heading for and checking out the Chrysler Group displays. Target achieved, Mr. Gilles - well done.

2010 Dodge Ram Heavy Duty including Chassis Cab and Pickups | Chrysler 200C

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