Chrysler, Dodge, and Jeep news from Allpar

Blacktop: illusory pricing?

caravan-blacktop

Since the 1970s, at the latest, car manufacturers have made certain features or trim levels contingent on buying other options; a tow package might cost $100, but require an engine upgrade and heavy duty suspension first, confusing the final prices. Moving to the present, one Canadian salesman wrote to us:

The 2014 Grand Caravan has a Black Top Package for C$1,395.  Not bad. But now add the mandatory SXT Plus group for $1,500 and the mandatory BlueTooth group for $850, and the $1,925 DVD group, and the cost is C$5,670 plus tax for the Blacktop group. Our new training materials promote it at only $1,395 over the 29G (SXT).  In reality, it’s $5,670.

No wonder we have such a crappy reputation as sales people. The materials train us to be deceptive.  If I tell a customer the Blacktop is a $1,395 option, they believe it’s $1,395 more.  If you have to add other equipment to the option then it should be grouped and priced properly. Just make the group cost $5,670.

I believe this is a deceptive practice and should be stopped.  I have been selling cars for [xx] years, and while some things have changed, others are still in need of change.

Another salesman confirmed,

I can confirm this, it’s a bad idea, and we did not order any for that reason. The only thing that I can figure, is that is maybe they are going to do a package discount down the line. They did a similar thing with the Ultimate Family Value van; you need to choose the DVD and the U-Connect, but they gave you a discount of $775 on the window sticker and an extra $1,000 bonus cash.

The Build & Price system on Chrysler’s web sites does notify customers of such issues, but not everyone uses the system, not all options are always included, and newer vehicles are often not covered by the sites. They also have had a tendency to be buggy and unreliable in the recent past.

A Chrysler representative responded with the following statement:

Going on 30 years now, Chrysler has provided more Canadians with minivans than any other auto maker.  Over the years we have led the industry in product innovation and provided Canadians with the ‘ultimate people mover’ vehicle.  We continue to look for packages that suit the Canadian market place as well as providing special offers to ensure our consumers are receiving exceptional value.

In the salesperson example provided, there are assumptions applied to one of our 2014 specialty option packages, for which we have not yet launched any incentive offers.  To give you some perspective, in 2013, we have a minivan package called the Ultimate Family Value Package, which is a $4,975 option, including popular equipment like power second and third row windows, 17-inch aluminum wheels, 6.5-inch touch screen radio, rear backup camera, and second row overhead DVD.  Consumers received an additional $1,000 savings in bonus cash and $775 in no charge equipment (UConnect) on the purchase of this vehicle, that provides them with roughly $5,000 worth of equipment for only $3,200.  Packages like these, when combined with the added discounts, generate tremendous value for our consumers.  For our 2014 model year minivan, we are entering into our third year of these programs, and look forward to continuing this special option / incentive offers to provide the utmost value to Canadian consumers.

July sales forecasts

Dart-Crystal-Ball

While sales numbers won’t be released until a week from today and even though there’s one more selling weekend in the month, industry analysts have already issued their forecasts for July light vehicle sales. Edmunds.com, Kelley Blue Book’s kbb.com, and TrueCar.com all see Chrysler Group reporting the highest growth of the top automakers with sales more than 20% higher than they were in July 2013, a month where Chrysler temporarily fell to fifth in the volume rankings, outsold by American Honda....

Wrangler: aluminum and/or hybrid?

As government rules get tighter, and to avoid losing customers if/when gas prices rise, automakers are trying to increase gas mileage. At Chrysler, Ram has been slashing fuel consumption by cutting parasitic losses, using eight-speed automatics, and spreading diesels to the 1500 line. Jeep is busily creating the new Wrangler, with an eye towards saving weight, and Chrysler has been advertising for a senior buyer for large aluminum castings....

No FCA-PSA Peugeot merger talks (either)

Mad-Scientists-Blackboard-Web

The slow week for Fiat news has journalists scrambling again. Thursday’s Financial Times reported that Fiat-Chrysler and PSA Peugeot have discussed a merger. Unlike the story in Manager Magazine about a possible FCA-Volkswagen tieup, the Financial Times said “people familiar with the talks” were fairly straightforward: the automakers did have discussions but nothing progressed beyond that point....

Advisors call for Fiat-Chrysler merger rejection

Cop-Stop-FCA-Web

Institutional Shareholder Services Inc. (ISS), the world’s leading provider of corporate proxy voting services, has issued a recommendation that Fiat shareholders reject the proposed merger of Fiat and Chrysler. Fiat needs the approval of the holders of at least two-thirds of the shares being voted. According to a Reuters report, an ISS recommendation document says, “Despite the potential benefits of a NYSE-listing in attracting new investors, (the merger) would decrease shareholder rights.” Frontis Governance, a smaller, Italian proxy advisor based in Rome, has made the same recommendation....

Categories: Dealers, Minivans, Promotion and Pricing.


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July sales forecasts

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