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This Just In...(Revision to Merger Agreement € / $)

Discussion in 'Mopar / FCA News' started by 77 Monaco Brougham, Sep 14, 2020.

  1. KrisW

    KrisW Well-Known Member

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    VW did not make any efforts to acquire Chrysler while it was on offer. It did want to purchase the Alfa Romeo brand from FIAT, although what it would do with it afterwards was never very clear (VW’s boosters said the company would set it up at the same level as Audi; I believed that was wishful thinking given the power structures inside VW Group, and more likely they’d replace SEAT badges with Alfa Romeo ones).

    But the US Government’s offer regarding Chrysler was not made to FIAT alone: any other car maker could have taken it up. Certainly, buying Chrysler would have been very good for Volkswagen, and would have given them the sales they needed to become #1 in the world, but I think like many other car makers, they were standing back and waiting for Chrysler LLC to die before rifling through its pockets for Jeep and RAM.

    However, I don’t think the VW of Ferdinand Piëch would have had the same kind of approach to its new partner as Marchionne’s FIAT did. For a start, VW would have treated Chrysler purely as an acquisition, not a partner: after all, at around this same time, Suzuki was suing VW in commercial court to undo a mutual shareholding, saying that the Japanese company was being treated as a subsidiary by VW - and that was just a 10% shareholding! (Suzuki won that case, incidentally)
     
  2. Dave Z

    Dave Z It's me, Dave
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    I wasn't really thinking of bringing back Imperial as it originally was, but as a moderately upscale, comfort-oriented brand like Buick or, really, Old Chrysler. That would require far less work. Keep the Quattroporte and Levante, drop the Ghibli, and do what they did to make Voyager but more so: fewer standard features, different sheet metal, and, most important, less money in the chassis. Maserati can afford to use more lightweight metals than a new brand would.

    The casualties here would be Chrysler, Lancia, and DS. I was basically trying to think of a brand that could replace all three. A restyled version of the Wagoneer with lower trim and no pretensions to offroading; a more comfortable version of the Charger (300C style); a more comfortable, on-road, not-at-all-offroad wagon (Magnum/next-Grand-Cherokee); the current DS line, refaced.

    My only thought there was doing a global brand. I threw in the Imperial name but it could be anything. They could keep DS. They could keep Lancia. I don't think they could get away with Lancia.

    Also, I think the Pacifica Hybrid could re-invigorate the minivan segment, but only if (a) they get the quality up and (b) they make it reasonably affordable - like Voyager - while keeping the high end version. It helps that they now have pedestrian avoidance.

    I don't know why VW didn't take over Chrysler when they could, but I am sure as h&[email protected] glad they did not. They would have kept the pickups and Wrangler and trashed everything else.
     
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  3. KrisW

    KrisW Well-Known Member

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    Global brands are overrated. In world where the exact same mayonnaise product needs two different brand-names to sell in the United States, we can probably justify having different brands for cars in different continents or countries.

    PSA has been happy to keep up GM’s charade of calling Opels “Vauxhall” within the United Kingdom, and FCA tried to re-launch Lancia into the UK and Ireland as Chrysler, while adding Chrysler models to the European Lancia range. I can’t think that splitting the world market for mainstream-luxe cars between Lancia, DS and Chrysler depending on which brand had greatest traction in each region would be contentious.

    DS isn’t certain in Europe. In Europe, Lancia actually sold more units in 2019 than DS, although on transaction prices, DS would be well ahead. But: remember that all of those Lancia sales were from just the Italian market, while DS was sold in 30 countries. That kind of local strength would guarantee Lancia’s survival, even if DS-Lancia became another ‘Opel-Vauxhall’.
     
  4. Adventurer55

    Adventurer55 Well-Known Member

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    They would be wise to use this strategy worldwide. Sell vehicles with brand strength in each area.
     
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  5. 77 Monaco Brougham

    77 Monaco Brougham Well-Known Member

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    My preferred candidate for such a brand name would be to bring back EAGLE. The word 'eagle' probably translates easily enough into any language without negative connotations. Plus...It's likely FCA still owns the rights to the name 'eagle'.
     
  6. 77 Monaco Brougham

    77 Monaco Brougham Well-Known Member

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    I was worried that would be the EXACT outcome if The Occupation had lasted much longer.:eek::eek::eek:
     
  7. patfromigh

    patfromigh Well-Known Member

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    If StalledAttempts wants to have success they will need sales volumes. Supposedly this was the reason Fiat wanted Chrysler in the first place. I remember how last decade SM would often stress the necessity of volume. Dropping models and brands doesn't increase volume. When GM axed Oldsmobile and Pontiac the customers didn't buy from the surviving GM brands, and volume dropped. The same thing happened at Ford when Mercury was canned. Plymouth buyers seemed to migrate to Hyundai/Kia and not to Chrysler or Dodge.

    The PSA strategy of a few platforms across a number of brands seems logical. There must be more than simple badge engineering however. The interiors will have to be tailored to what Americans want to buy. This will be difficult since various automakers have showed little proof they know what Americans will buy. We do know they won't buy swoopy vehicles with doghouse center consoles, which some PSA vehicles are.

    Drivetrains are another area were the American market is different. There have been too many problematic transmissions imposed on our market and not just from FCA. Small displacement engines don't seem to face the sales resistance that they have in the past, but smoothness is critical. Some cars feel like they have leaned-out carburetors with all the hesitation, bucking and surging.

    Simply changing grills might be a mistake. There are so many pigs and not enough lipstick. Let each region have their own style. Strategies and components for electrification can be standardized, but regional allowances should be made for fossil fueled engines. There should also be more communication between regions. Despite Fiat's success in Latin America, the is scant evidence of influence coming to us from there beyond the Jeep Compass.
     
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  8. Dave Z

    Dave Z It's me, Dave
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    patfromigh, KrisW,

    You've changed my mind.
    Not kidding here.

    I do think DS is probably more what people want than Alfa. How many people really intend to buy a pure driver's car in sedan form? Apparently not as many as Alfa thought.

    For the US, I still don't see much of a future for Chrysler, but I could be wrong. I don't know how profitable Pacifica is, that's a serious question regarding whether Chrysler keeps going. I'm guessing either it IS profitable, or the execs are giving it one last big try before calling time of death on minivans. (Since they've invested a decent amount in the 2021 upgrades.) There are lots of options to play with, including reselling P's as Chryslers and DS as itself or as Chrysler or as Alfa or Hudson or whatever...

    (Hudson was a fairly upscale brand in its prime, and lots of kids and adults know it by the uncharacteristic Hornet.)
     
  9. Tony K

    Tony K Active Member

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    First, I'd ask from the perspective of this being a enthusiast's forum and not the "Disqus Peanut Gallery(TM)" that folks in general refrain from using the cute-but-divisive backhanded nicknames. We haven't even given Stellantis a chance to screw up yet. :D

    Also agree that it makes no sense to develop platforms, then not optimize utilization across the corporation. Notice, I say "optimize" and not "maximize" since, for perspective's sake, I don't think SM said "volume über alles" (or whatever it would be in Italian.) :cool: I hear too many folks seemingly clamoring for maximized utilization, which is part of the reason we (historically Big 3) get in all these industrial pickles in the first place - we keep shooting ourselves in the foot building mass market stuff that we overprice then have to give it away, just to have to lay off a bunch of working stiffs when the economy goes south. Sure, there's a place for that, but Giorgio, for example, ain't that place. We need a sustainable volume-margin approach.
     
  10. Chrysler UK

    Chrysler UK Active Member

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    I was actually talking about when Volkswagen where (allegedly) considering buying FCA in 2014*, but decided otherwise. Sorry if I didn't make that clear.

    Regardless while I would agree that Volkswagen would likely kill off SEAT should they ever get their hands on Alfa Romeo, they would at least be willing to spend the money, time and effort to turn AR around (moreso than FCA anyway). Especially when they have a good record of improving/reviving other car brands such as Audi, Skoda, Bentley & Lamborghini.

    *Why Volkswagen's secret plan to buy Fiat-Chrysler failed | Autocar (at https://www.autocar.co.uk/car-news/industry/why-volkswagens-secret-plan-buy-fiat-chrysler-failed )

    Was this really a wise move on VW's (& others) part considering that the US Government (under both GWB & Obama) was willing to save Chrysler again (at all costs)? Especially when it would have meant that there was no prospect of Chrysler going into Chapter 7.

    Wasn't Marchionne compelled into treating Chrysler as an equal partner within FCA because of how much FIAT needed Chrysler to secure its long-term future (as it was the other way around)? Because lets face it; without Jeep & RAM keeping FIAT in the black, they would have been in a far worse position than FCA as a whole is currently faring.

    Likewise while Volkswagen would have treated Chrysler, Dodge (w/ RAM) & Jeep as branches of the wider group and excercise greater control over them than FIAT ever did, it would have been better for those brands in the long-term (compared to FCA). Mainly because not only would the build quality be better on the cars all 3 make, but it would have also meant that the Wagoneer would have arrived much earlier than it actually did.
     
  11. Chrysler UK

    Chrysler UK Active Member

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    Considering that DS & Alfa Romeo are supposed to be competitors to the likes of Mercedes-Benz, BMW, Audi & Lexus; it only makes sense to have Imperial be a Premium Brand that can actually compete with those 4 Brands. Otherwise you might as well properly revive Chrysler itself and have Jeep become a actual Premium Brand instead.

    So in other words, you want Imperial to be a less upscale version of Maserati? Unless I am mistaken of course...

    Agreed, although it would have to involve the "Grand Wagoneer" version of the Jeep Wagoneer becoming standard version of that car. With the "Grand Wagoneer" name being reused for a LWB version.

    One could have the proposed "7 Seat" version of the Grand Cherokee become the Imperial Mid-Sized SUV instead.

    The DS7 is the only car in the current DS range that I feel should be moved to your proposed "Imperial" Brand, with the DS3C & DS9 both getting scrapped.

    Whatever brand does end up being used, they need to put the money, time & effort into that brand if it's to stand a chance.

    I feel that the Minivan/MPV Market (especially in Europe) has passed the point of no return, even if the Pacifica Hybrid is a very good car within that segment.

    To be fair, VW would have likely put more effort into Jeep than FCA have done up to this point. For example by improving build quality & introducing the Wagoneer many years before FCA finally will.
     
  12. KrisW

    KrisW Well-Known Member

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    Why do you associate VW with build quality? It's not the 1980s anymore: These days, the bits of their cars you can't see are made from gum and silver paper.

    Regarding your earlier post, FIAT Auto did not need Chrysler. Had they not taken the leap, they would now be pretty much where PSA is now in Europe. Diversion of spending into the North American Market is the cause of the decline in Europe. That paid back later, but in saying the US arm kept profits up when the European one dropped, you're confusing effect and cause. (also, FCA isn't structured like that. European spending is funded by Europe alone. Losses and R&D were paid for by sales of holdings in Ferrari and the Magnetti Marelli business unit)

    Marchionne's attitude at Chrysler was exactly as it was on taking over FIAT: if a project or team was good, then it was supported, regardless of origin. I don't see evidence of that within VW.

    Giulia/Stelvio are better than any car made by Volkswagen at anything like the price : I for one am glad VW didn't get the Alfa brand.
     
  13. Adventurer55

    Adventurer55 Well-Known Member

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    And the new company will have the exact same problem if they do not maximize their platforms.
     
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  14. 77 Monaco Brougham

    77 Monaco Brougham Well-Known Member

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    NO!...Silver paper would be too expensive. I'm sure VAG would use 'iron paper'...made from cheap low quality recycled Chinese Iron.:p:D
     
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  15. patfromigh

    patfromigh Well-Known Member

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    I like the word Tony K uses in his post, "optimize". Not every brand needs to have an A-segment BEV built off the new 500e platform, while the EMP2 platform can be used among many brands. Slapping grills and badges on another brand's products is a FAIL, as GM has proven with the Buick badged Opels and Chevy/Pontiac badged Holdens.

    The Chrysler brand needs to be defined before it gets a bunch of new products dumped on it post-merger. Some GM insiders have said killing off Pontiac was a mercy killing because of all the cast-off designs inflicted on that hapless division. GM was putting heritage Pontiac names on other people's products such as the final LeMans and GTO.

    If Peugeot wants products sold under their brand name in North America, they will have to decide how the brand fits with Chrysler and Dodge. Then they have to preserve that distinction and not step into Chrysler's realm or Chrysler into theirs. It could be a difference in size, equipment levels, or technology. The brands each need to have uniqueness, not "brand managed' with a fatal blow which struck GM from the ivory tower by corporate management during the 1990s.
     
  16. Adventurer55

    Adventurer55 Well-Known Member

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    I agree. When I said maximize their platforms, I meant that utilize them in the markets that apply to the particular platform. The US is not going to be an easy solution, there are needs that don't necessarily apply to other parts of the world. If Peugeot tries the same thing that Fiat and Alfa have here they will fail as well. They need to decide whether Dodge and Chrysler are worth saving. If so give them some product.
     
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  17. Chrysler UK

    Chrysler UK Active Member

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    Granted there are question marks over the quality standards at VW, but they are still generally better than FCA. Although I would agree that the gap between the two has fallen signifcantly in the last 20 years.

    Fiat, Alfa Romeo, Lancia & Maserati had around 1.56 Million Sales in 2019. So had Fiat S.p.A not taken over Chrysler, they would have ended up having less than half the sales of PSA and thus would not be in a position to survive independently.

    Hence why taking over Chrysler was critical to their future as a carmaker. Then again the Fiat takeover itself was critical to securing Chryslers own future.

    I am not trying to complain that "FCA US is always bailing out FCA Italy"; but rather state that Fiat needed to take on Chrysler to make sure that said company survived as an independent carmaker, hence why they really wanted the Fiat-Chrysler merger to sucessfully work out.

    Which in turn is why Fiat where compelled to give Chrysler a lot of autonomy in a lot of areas.

    Which is a good attutide to have, but one that was motivated by necessity to a great degree.

    Would you say that the Alfa Romeo Giulia & Stelvio are better cars than the Audi A4 & Q5?
     
  18. Chrysler UK

    Chrysler UK Active Member

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    One would argue that the car industry has been moving towards Global Brands in the last few decades or so.

    Fair point, although the brand has been declining for the last decade or so.

    Without much success to be fair.

    The trouble is though, would a DS-Lancia-Chrysler trifecta work against the likes of Mercedes-Benz, BMW, Audi & Lexus compared to say a single brand that Stellantis can focus resources & effort towards?

    One could make the case for Alfa Romeo to become a pure "Performance Car" brand like Dodge rather than as a serious rival to Mercedes-Benz, BMW, Audi & Lexus. Hence why I wanted to turn it into the "performance" brand of Imperial.

    From what I understand; the Pacifica is still profitable for now. However I doubt that it's profitable enough to justify a direct sucessor.
     
  19. Chrysler UK

    Chrysler UK Active Member

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    Damiler AG & JLR came to an agreement over the use of the "Damiler" name around a decade ago, so I suspect there where other reasons to why a US Trademark was denied to JLR over Damiler. Although to be fair, Tata themselves have shown very little interest towards the Damiler brand since they took control of JLR.

    Wouldn't future Federal & State Governments want to see more EV's sold (to reduce carbon emissions) and thus will likely provide financial incentives to buy such cars? Likewise one must not forget (thanks to the large numbers of free charging points) that the running costs of an BEV car are lower than an ICE car.
     
  20. Tony K

    Tony K Active Member

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    I figured my idea of the way ahead, assuming Tavares holds branch/division leads/VPs responsible for building quality into their organizations which then translates into the product. All of this is long game, a 10-20 year plan. Some product overlap is acceptable, but other than very short term, no badge engineering. Not sure how to deconflict Fiat Pro and Peugeot's commercial line, except we know that's an anti-trust issue anyway.

    NAFTA
    Chrysler can compete somewhere between Buick and Caddy - not a large volume but still mass market, with upscale vehicles across the range - NAFTA plus certain RHD Commonwealth nations, as upmarket to Vauxhall in UK/Opel in IE. Can answer large upmarket RWD mail. Could sell in China for RWD upscale.
    Dodge covers Dodge and Plymouth range - major mass market brand with lots of muscle and road oriented S/CUVs. The hotrod US S/CUVs belong here, for the most part. Could be the STEL answer to GM's American brands in China.
    Ram does what it does best, which is trucks and work vans - Americas and China
    Jeep is Jeep: offroad biased utility vehicles. Mostly boxy. A few hotrods, like the Trackhawk - Global

    EMEA
    Old Fiat Group
    Maserati - nothing less than 6 figure luxury/sports - Global
    Alfa Romeo - European sub-6 figure luxury/sports - long-term global
    Fiat - Italian mass market - wherever it is successful, it stays, eastward expansion in Europe seems to make sense based on history, any US sales come through Maserati/AR dealerships until no longer feasible
    Lancia - may be relegated to Italy-only brand selling their version of certain STEL platforms as is deemed appropriate
    Abarth continues to "Abarth"
    Fiat Pro covers where Ram/Peugeot commercial doesn't

    Old Groupe PSA
    DS - could be a global luxury brand long term, competing in the same market as the German luxury makers, who along with Peugeot, could come to NAFTA in Maserati/AR dealerships.
    Peugeot takes over where Fiat feared to tread in the US as it completes its global aspirations
    Citroën everywhere but NA and S Asia.
    Opel is definitely solid in Germany and in the UK as Vauxhall. Opels become Chryslers in Oceana. Returns to Japan.
     
    #60 Tony K, Sep 19, 2020
    Last edited: Sep 19, 2020
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