Discussion in 'Mopar / FCA News' started by Allpar News System, Feb 2, 2015.
What a pile of dung, both of them...
More sales = more people stay employed. It may not gain in company profits. So maybe 3 dodges low option might profit the same as 1 loaded T/C. (just an example, not truth) I'm all for keeping Canada, USA people working. Even if allot of production is robotic, there still needs to be someone to do final detail and drive it out the factory. Then from factory lots to shipping. Truck or train.
The company may profit for selling half as many vehicles, but that also allows the company to let go a shift of employees if they were working 2 shifts.
Do we have numbers for 200 sales vs the old 200 plus Avenger?
I remember another false argument that 200 would sell great if they only dropped Avenger...
Not every Avenger buyer lost, went to the 200.
It's like saying the 300 would sell better if they dropped all other FCA models...
There are those who would rather buy from rental companies to save money for an almost new vehicle under 40K miles. Rental companies bunting the cost of dealership mark up.
People complain about rentals flood the market, thus devaluing the vehicle. But is it dealerships with their $2500-$5000 markup the real over valuing the vehicle?
2012 Avenger and 200 sold approx. 222,500 combined. 2013 Avenger and 200 sold approx. 216,500 combined units in the U.S. only. So over the 2 years they averaged 219,500 per year in the U.S. or 18,291 ave per month. 200 sales 2014-15. July 8,159, August 10,810, September 10,995, October 11,675, November 14,317, December 16,229 and January 14,157.
Using this logic, why would they make a Hellcat Grand Cherokee? That doesn't fit the Jeep mold. It does represent a viable market though. Similar to my Dodge argument?
Might as well add in the Dart sales since it effectively replaced the Avenger.
Because there is already a SRT Grand Cherokee.....
T&C U.S. 138040+ Caravan U.S. 134,152 + 11,311 Cargo + Gr. Caravan (Can) 51,759 + 11,622 (Can) T&C and Cargo = 346,884. From Chrysler own figures released to the media. I said in the original post Chrysler sold 346,884 vans in 2014 which they did. Cargo vans still count as sales.
Not sure about that one. Two dissimilar vehicles.
Maybe replaced the Neon, but you'll get detractors for that argument too.
All that can be said for sure, is that Dart kept the Giulietta from coming to America...
Isn't there also a difference in cost to bring 2 vehicles to production than 1, including everything like marketing, etc? Even if current 200 sells less than outgoing 200 + Avenger, you could have a scenario where it is better from an overall profit standpoint, as long as the sales of the new model aren't way off from the total number.
Same for minivan. Perhaps 75% of current sales from 1 minivan is better than 100% of sales from 2? Obviously I'm speaking without numbers on hand, but offering up scenarios.
It's just not simple to say less volume is necessarily bad. It might be. It might not.
They haven't made a Hellcat Grand Cherokee. (And the SRT Grand Cherokee was made before the decision to alter the Dodge brand focus was made.)
I'll stop asking about the exercise; it's apparent that it's difficult at best.
I'm think exactly the opposite, ...because...the funding comes from both Dodge and Chrysler for a 200 and Avenger, solely from Chrysler for a new 200.
Marketing for a new Caravan comes from Dodge, a new T&C from Chrysler, and so on and so on. Potentially twice the budget to market, than just one product even if they allocate the same amount, the percentage increase will suck the life out of other model budgets at Chrysler.
You're correct, wasn't factoring in Cargo van. Thanks. Obviously Promaster City may help to offset this once it starts really selling.
If we are going to spin numbers, make sure to include Promaster City vans and wagons.
I was thinking from an FCA level, not individual brand level. Marketing of one brand would mean you need more sales from that one brand, so yes, that marketing budget of Chrysler T&C goes up over past Chrysler T&C budget, but are you saying that old marketing budget of Chrysler T&C & Dodge Caravan would be less than new marketing budget under 1?
Also, there are development costs of bringing 2 to market over 1.
Promaster city didn't have any sales figures published for 2014 by themselves that I could find. So far in 2015 Promaster city sold 93 vans and the C/V sold 1101. I know the C/V sales aren't much but I was just explaining where I got that figure from.
I was talking about a post that another made that made sense about profit and volume. How many products does your business sell knowing your going to lose money on just for bragging rights about volume? I hope none for your sake.
I'm sure Chrysler has plenty of very smart people working on these decisions. To automatically assume (like is done here all the time) they are wrong isn't.
Compare ProMaster to Ram CV
I know exactly what you were referencing, however what you think he said and your equation of selling at a loss and making up for it with volume, are not the same.
Not saying it would be less, I'm saying Chrysler will have to spend much more to garner the numbers that it and Dodge combined sold,...if that is even possible with only one brand.
These planners are missing the part about Dodge buyers and Chrysler buyers, not being the same buyer.
As for development costs they were shared before, Chrysler will bear the brunt now.
Remember Sergio's big idea was to make each brand CEO responsible for profit and loss, under each brand, not some nebulous FCA umbrella. It's one of the reasons Dodge took its marketing money away from SRT and the NASCAR effort, those dollars weren't directly benefiting Dodge, as much as they thought a direct Charger campaign might.