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Mistakes of Daimler-Benz in Running Chrysler

I wouldn't be right for someone to ask for a new management team at Chrysler without explaining their reasons, and offering to kindly point out a few mistakes. That having been said:

The first thing the company needs to do is concentrate on the things it currently does well, and those things that brought it success in the first place. In a nutshell, it's building high-volume, value-centered cars, minivans and light trucks.

Although many others can do this, Chrysler has always been able to do it with a bit more style and personality. One thing is certain, any new buisiness plan should have little to do with low-volume niche vehicles or any other form of ego-stroking.

In other words, how do the leaders at DCX justify the expense of a Karmann-built sports car like the Chrysler Crossfire, while claiming it's too expensive to add PT Cruiser production at a US plant? How does Chrysler's corporate parent explain the millions spent developing an extraneous $250,000 ultra-luxury sedan (Maybach) while complaining it can't afford to develop its own economy cars? What if just a small portion of the billions DaimlerChrysler has spent acquiring percentages of bankrupt automakers, had instead been used to bring its Chrysler Group passenger cars up to a higher level of refinement?

Dumping the Plymouth division was a mistake, and I'm not saying this while sitting weepy-eyed with nostalgia. You could even change the name and call it "value" or something more 21st century. But, the company would do far better by promoting a distinct low-price brand instead of selling cheapened versions of Dodges as Chryslers, while at the same time trying to move the Chrysler brand further upscale.

The PT Cruiser should have been branded a Plymouth (as was the original intent, thus the tie-in with Prowler styling). Eventually a Plymouth Voyager minivan could arrive wearing Cruiser-like front sheetmetal. Certainly that expense can be allowed for a vehicle selling in the hundreds-of-thousands.

Why not create Plymouth-exclusive value editions (like the America series of Horizon/Reliant/Sundance) with standardized option/trim levels to sell at rock-bottom prices, targeted directly at the Korean/low-price segment? Throwing away the Plymouth brand isn't going to save the company any appreciable amount of money, but it sure was a missed opportunity to think "out of the box"

And what about this idea of promoting the Chrysler brand as some sort of chic "American Audi?" Isn't this the idea behind the Crossfire and 300M Special?

Let's face some hard facts. In 2001 the Chrysler brand doesn't get much respect, and right now it doesn't have the high-tech hardware in its arsenal to become the American version of anything from Europe. Better that Chrysler should set its sights on improving the quality of materials (leathers, fabrics, etc.) and eliminating as much squeaky plastic as possible. Until then, all of the GPS hardware, telematics, stability systems, etc. will be wasted on a car that has hard plastic dashboards and carpet that looks like recycled plastic bottles.

The Dodge division, the sporty innovator -- Have you seen anything sporty or innovative lately? It's rental car city! Whatever happened to the GLH Omnis, Shelby-ized turbos, the American Club Racing Neons? Can we have a little affordable fun for the common man, or is everyone supposed to purchase the boring sedans based on the image of the Viper and Dodge Ram truck? And I question just how many people will see the trucks' totally redesigned platform and new features beyond the annoying, big-hair Aerosmith music in the soft-sell commercials.

The man who supposedly "saved" the Freightliner division of DCX (which just lost over $1-Billion) has held the top job at Chrysler for a year. In that time, little has been done outside the realm of cost-cutting and layoffs. Suppliers have been squeezed, bonuses cut and vehicles have been either dropped or de-contented. Even the employees' 401K match has been canceled. The company now continually begs its employees to convince their friends and family to purchase vehicles. Incentives are on, incentives are off - no wait they're back on again!

None of this confusion influences anyone to purchase a Chrysler product, in fact this all too public display of incompetence probably results in fewer sales.

Recently, Chrysler group announced that it will allow Chrysler/Jeep and Dodge stores to combine. This change in policy must have been done to appease the larger urban-market dealers, since it does the company absolutely no good. It will only allow easier cross-shopping between Dodge and Chrysler brands. And what will become of the empty real estate that was once a separate Chrysler or Dodge dealer? Likely they'll re-open as a competitive make.

When questioned by the press, Dieter Zetsche almost sounds pleased to be bumped into 4th place in automotive sales by Toyota, claiming that being part of Detroit's big-three carries a "negative image". It seems as if his strategy for Chrysler is to gain an exclusive image by whittling sales down to 2% of the market, the same as Mercedes-Benz.

In any other company, this display of ineptitude would be met with a senior management house-cleaning by the board of directors representing shareholders. But since ownership of DaimlerChrysler AG is largely a tangled mess of German government, German banking and Kuwaiti oil sheiks, this mess might keep sliding into red ink for years.

In the meantime, there will be more finger pointing, scapegoating and downsizing.

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