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The loss of 200 and Dart....

Discussion in 'Mopar News' started by CDJSalesPro, Dec 2, 2017.

  1. Charger383

    Charger383 Member

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    Agreed, a stop gap product is better than no product. Even if the car sale doesn't generate a profit, FCA can still turn a profit on financing and servicing it. Giving a customer away to the competition is foolish.
     
  2. page2171

    Level 2 Supporter

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    Stop gap products aren't free to develop, test, certify, etc. Blowing money on cars that you have to pay people to buy with incentives, and then lose money on every one isn't a great business plan either.
     
  3. Charger383

    Charger383 Member

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    That would have been my next car purchase -- if they had built it.
     
    TimesTen and somber like this.
  4. Charger383

    Charger383 Member

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    Dodge Dart and Chrysler 200 weren't losing anywhere near the billions that Fiat USA is still bleeding.

    Sergio killed far more viable products to prop up something that makes ZERO financial sense. Fiat Studios (standalone dealers) are losing so much money right now, that the Fiat brand is paying their rent! (That is unprecedented in this industry)
     
  5. page2171

    Level 2 Supporter

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    The Fiats that are selling here aren't taking up valuable factory space that can be used to make something that actually makes money.
     
    cgseller@gmail.com and ScramFan like this.
  6. MJAB

    MJAB Well-Known Member

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    I used wrong term "principles", meaning was since the volume of a model is very low than drop that model in a geographic macro area.
    The two Wrangler model example was since sales have been always low in Europe, but Wrangler has a marketing value. But for sure the cost associated to have a diesel engine inline with emission rules in European Union was for sure not low cost.
    Also other models, always with their diesel engines, had very low registration numbers.

    The KPMG study was to show that the most "penalized" market in the future, that is not so far for a manufacturer since cycle of life of a new model is not so short, will the the "sedans".
    KPMG forecasts is that the number of manufacturers that will manufacture that "appliance sedans" will be few.
    note: I wrote "appliance sedans" since are the generic sedans that are bought only because customer needs it for transportation, with very few or no emotional implication of the desire of owning such vehicle (= they drive because they have to, not because they like driving).

    The other part that is also in KPMG study, or in others, is that automotive scenario will change since "new" markets will appear or increase greatly their volume of incomes.
    Also actors of the next automotive market, better to say transportation market, will increase in number and will arrive from other industries.
    In many situation actual automotive manufacturers will see at least a part of their business to shift from being end point to "private customers" (B2C) to a position of suppliers of other companies (B2B), a position that most manufacturer doesn't like at all (and that position that even be worst than the actual sales to "fleet" customers).

    KPMG forecast the reduction of "sedans" volume from 5.4 to 2.1 million by 2030.

    Some possible effects on "sedans" market volume reduction (each point could happen or not because other points):

    - average price of sedans, without increase due to emissions and/or safety rules, will increase (amortization costs will be higher per unit)
    - some actors (manufacturers) will leave the "sedans" market, the fewer bigger ones can maintain volumes and their actual structure of costs
    - fewer manufacturers continue sedan production in their plants at actual volumes, other manufacturer sedans drop their production of sedans, but are supplied by other manufacturers
    - no "traditional" manufacturer continue "sedans" production, very few suppliers start manufacturing "appliance sedans" for "traditional" automotive manufacturers and the companies that offer "transportation" services.
     
    aldo90731 and ScramFan like this.
  7. Charger383

    Charger383 Member

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    Yes they are. The Fiat 500 is built at the Compass plant in Mexico. The 500X is holding back capacity/production for the more popular (and profitable) Renegade.
     
  8. Bob Lincoln

    Bob Lincoln "CHECK FAULT CODES"
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    It doesn't matter to me or 320 million other people if a car is available in Turkey. If it isn't available in the US, it's IRRELEVANT to us.
    If you don't see the harm in a CEO talking trash about his own products, or, worse, calling his employees dummies, I can't see any value in discussing anything business-related with you.
     
  9. valiant67

    valiant67 Rich Corinthian Leather
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    But at the rates they are selling, are they even covering US certification costs? And the 500 is staking up the Toluca factory until it moves, it should be forced out to make more Compass(es) like Dart was forced out for Cherokee.
    They also take up lot space which can be used for more profitable products (which in stand alone Fiat dealers is usually used cars).
     
    CherokeeVision and Charger383 like this.
  10. Charger383

    Charger383 Member

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    There is no way that is an accurate forecast. There are way too many Accord, Camry and Corolla loyalists.

    Corolla is the best selling vehicle in the world -- they sell over 1,300,000 each year. Sales of it have actually
    increased over the past 5 years despite the analysts predictions to the contrary.

    Corolla by the Numbers | TOYOTA Global Newsroom (at https://newsroom.toyota.co.jp/en/corolla50th/history/by_the_numbers/ )
     
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  11. Charger383

    Charger383 Member

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    There is no way that is an accurate forecast. There are way too many Accord, Camry and Corolla loyalists in the USA.

    Corolla is the best selling vehicle in the world -- they sell over 1,300,000 each year. Sales of it have actually increased over the past 5 years despite the analysts predictions to the contrary. There are a lot of people who will never buy a crossover (myself included) -- the analysts have no clue. Analysts can't dictate what a buyer wants.

    Corolla by the Numbers | TOYOTA Global Newsroom (at https://newsroom.toyota.co.jp/en/corolla50th/history/by_the_numbers/ )
     
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  12. Bob Lincoln

    Bob Lincoln "CHECK FAULT CODES"
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    It was not a mess until 2015. The 6-speed auto is flawless, gives 31 mpg EPA highway, and as high as 34 mpg in real-life.
     
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  13. Bob Lincoln

    Bob Lincoln "CHECK FAULT CODES"
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    It was the WORST call since 2009. Any company where the CEO announces that a segment of the product is going away with no plan to replace it, and then calls his own employees dummies, is asking to lose its customers. And that is the most fatal result. FCA can not enter this market again to any significant degree.
    Would you buy a product from a company where the boss said his employees were dummies? And that that's why he's dropping a product? But that maybe someone will come calling to make that crap for him?
     
  14. T_690

    T_690 Active Member

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    That's simply not true and you can check the facts.

    Actually they had some layoffs this year.
     
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  15. Bob Lincoln

    Bob Lincoln "CHECK FAULT CODES"
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    No, there was always SOMETHING there. Avenger, Sebring.
     
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  16. page2171

    Level 2 Supporter

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    Don't know, don't care. That money has already been spent. Don't cover the certification costs by killing them either.
    Don't think the Compass is production constrained yet. If it was, then I would agree with you. But, why would you kill the 500 to free up production capacity when extra production capacity isn't needed yet? That sounds like a dumb plan.
     
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  17. Judas Shuttlesworth

    Judas Shuttlesworth Active Member

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    Not disastrous unless you have to actually sell them and find you have nothing to sell.
     
  18. Bob Lincoln

    Bob Lincoln "CHECK FAULT CODES"
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    We owned a Camry for 14 years. We've owned a 200 for nearly 6 years. NO COMPARISON.
    The Camry was a wallowy, poor-handling sofa on wheels with a bad interior - thin cloth exactly like my dad's 1966 Chevy Biscayne, that wore a hole through. Totally unexciting. The 200 interior is fantastic, has the best ergonomics of any car I've every driven, at 60K miles is still tight, quiet, rides and handles great, has tons of what I consider luxuries as standard equipment. Even before the 2015, the car was definitely far above a Camry. But FCA's reputatiion for poor quality in the past, and the unresponsive dealers are the two biggest issues. And still are.
     
  19. Bob Lincoln

    Bob Lincoln "CHECK FAULT CODES"
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    Fiats that are selling here? All 50 of them?
     
  20. Judas Shuttlesworth

    Judas Shuttlesworth Active Member

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    Sergio gets no slack on this. This is the CEO who was neck deep in product development and was known for sending people back to the drawing board when it was something he didn't like.
     
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