[CNT900]

Have to say I am a bit disappointed reading Bill Cawthon's article about the likelihood that Ram dealers will not be getting Iveco commercial trucks to sell after all, like the Daily van. I was envisioning the possibility of a three way tie up of Ram, Iveco, and CNH. I think such an arrangement may have created some unique opportunities for Ram, particularly in the construction industry. And of course it could have been a way for Ram to expand into heavier medium duty and heavy duty commercial trucks. As I understand it, Fiat Industrial, after having been spun off of Fiat SpA, well be merged with CNH and will become a separate entity from Fiat SpA.. I have a few questions about the deal:

One, does it make it easier for Fiat SpA. to liquidate their investment in Fiat Industrial and CNH if needed to facilitate purchasing the rest of Chrysler?

Two, does it have anything to do with Fred Diaz's departure? This certainly could not be the only reason Diaz left (if it was a factor at all), but he seemed to be a major proponent of expanding Ram into larger commercial trucks through Iveco.

I am less optimistic about Iveco's prospects in the U.S. if their products are marketed through CHN dealers instead of Ram dealers. Either way would likely mean a completely new commercial truck dealer network would have to be created, but I think the Ram brand would have made the effort more successful. Time will tell, but I see some tough sledding going against Navistar, Freightliner, Volvo/Mack, and PACCAR.

 

[RVC]

Fiat Industrial has been a separate entity for some time now, so this is more of an administrative thing to improve fiscal efficiencies and access to capital. It has no bearing on fiat SpA. Besides, there isn't a need to raise more capital to buy out the rest of Chrysler.

It's possible that Iveco may look to buy out a local player to enter the US market, who knows. They've been at this for some time all over the world, I'm sure they know what they are getting into, plus the NH side of the house is very familiar with the domestic market; I'd imagine they'll scope things out very carefully before committing the resources needed to try to make it a successful launch.

 

[MoparNorm]

Historically Dodge Truck Division provided everything from small pickups, to Vans, dump trucks and over the road Semi's.
Without Iveco trucks or with Iveco trucks, calling Dodge Trucks, "Ram" is making less and less sense. Iveco merged into a Dodge Truck, CNH Division, with separate dealerships to work on bigger chassis, motorhomes, etc., seems like a lost opportunity.
One can be a financial genius and still be a poor product planner.
Iveco wasting funds to buy out a local player, when Dodge Truck has 2,000 outlets and Iveco has their outlets, can't be a good plan.
Is Marchionne still chairman of Fiat Industrial?
Is this a likely outcome or Bill's prediction?

 

[Erik Latranyi]

One can be a financial genius and still be a poor product planner.

I am looking forward to reading Bob Lutz's new book, "Icons & Idiots" about the leadership of auto companies. Some just wanted to be told they were right all the time while others stole soap and jelly from hotels, despite their salaries.

Lutz talks about one executive who could analyze financial statements and balance sheets but had no clue how to connect those numbers to a car purchase or plant investment.

 

[MoparNorm]

Bob Lutz, could have saved Chrysler...

 

[Erik Latranyi]

Bob Lutz, could have saved Chrysler...

If you consider that the "profits and success" are coming from legacy products that were improved properly, he sure could have.

 

[ptschett]

As already pointed out, Fiat Auto and Fiat Industrial have been separate for 2+ years now.

Here's an article as recent as this past March, well after the Auto/Industrial split and after the FI/CNH merger was already being discussed, where Diaz is quoted as saying his group was looking into the business case to marketing the Daily through Ram...
http://m.fleetowner.com/equipment/ram-dead-serious-about-commercial-trucks

 

[MoparNorm]

If you consider that the "profits and success" are coming from legacy products that were improved properly, he sure could have.

That is in fact, the unspoken truth.
Chrysler's profits are coming from legacy products.
Not from Dart, not from 500, not from KL, so far those three are a huge drain upon the company.
The reworked Alfa's may yet prove to be a success, but first they have 3 billion dollars to recoup...and if Dart's 1 billion investment was overlooked, it's 63,000 units means it's platform was 30,000 units away from break even.
This next year will be make or break for the shared Architecture theory.

 

[plymouth1]

I am very happy to see this news. The Promaster should have been sold under a different brand too.

 

[suzq044]

the name pro-master is just stupid though. Marketing needs new people, it seems.

 

[willy4110]

We sure could have used Bob Lutz, unfortunately his departure was a direct result of Lee Iococo's (intentional!), mammoth sized ego. No doubt Lee will be in the Idiot column.

 

[RVC]

One can be a financial genius and still be a poor product planner.
Iveco wasting funds to buy out a local player, when Dodge Truck has 2,000 outlets and Iveco has their outlets, can't be a good plan.
Is Marchionne still chairman of Fiat Industrial?
Is this a likely outcome or Bill's prediction?

Likely a prediction. yes SM is chairman of FIAT industrial.
The 2,000 RAM outlets would be utterly useless to sell and service Semis, earth moving equipment, etc. the investment would have to be made anyways.
Hence my suggestion that it would probably, make sense to buy out a local play with an already in place infrastructure.

 

[MoparNorm]

Likely a prediction. yes SM is chairman of FIAT industrial.
The 2,000 RAM outlets would be utterly useless to sell and service Semis, earth moving equipment, etc. the investment would have to be made anyways.
Hence my suggestion that it would probably, make sense to buy out a local play with an already in place infrastructure.

I don't disagree, Sprinter was a headache for owners who discovered it would not fit into Chrysler Service bays.
So some arrangement would have to be made. CDJ Dealers would fight to keep Dodge Ram, for many it's their volume leader.
Back in the day, there were regional Dodge Truck Dealers that sold and serviced the medium and heavy duty offerings. The Semi's, dump trucks and others were seldom, if ever, seen at the car dealerships.
So stand alone locations, similar to the Fiat Studios, is required, whether new or acquired from elsewhere.
Im not familiar with the number of CNH dealerships, but it appears their plan needs work, whatever it is.
Before Chrysler, Daimler and now Fiat began disassembling Jeep, the BOF Jeeps had much more in common with Iveco than the Alfa's they are beginning to morph from.

 

[willy4110]

BTW, those Dodge dump trucks drove very nicely, and the Bighorn (I think that's what the big highway truck was called...I still have a brochure of one), was ahead of its time. Oh well....

 

[JavelinAMX]

the name pro-master is just stupid though. Marketing needs new people, it seems.

Hear, Hear ! Too many instances prove this out -

 

[JavelinAMX]

One key, easily overlooked, is the time the CNH situation took to morph to what it is now, according to the announcement.

Don't fret too much about it, because it might be a financial strategy, not a brand strategy. By that I mean, the marketplace for large equipment ~might possibly~ be a much slower 'mover' owing to the economy. It might be a worthwhile risk lining things up this way in the near term knowing that these companies might not stand as playing chips and can 'stand pat' for longer periods than automobiles - making it a bit of a gamble to put the brands together independently for a while ( say around two years, as was noted, maybe a little longer ), and when the economic climate and the condition of the main companies' ledgers stabilize yet another move to shake things into an easier arrangement could be undertaken which will benefit the company after the IPO. Ultimately, if making the collection of CNH/Iveco into a unit will enable both entities to play-out a profitable, self-sustaining arm for a while, then 'Treading Water' management could help ChryFi - sort of an auto-pilot . The Ram Commercial evolution is still underway and making progress. They might know that it would take two to four years before they could turn to Iveco to address the Medium-sized Commercial vehicles when the time is more opportune. Their previous time-table might have been too optimistic ( and the timetable might've been set before they knew the Euro auto market tanked as bad as it has ).

They probably planned on the IPO already being a matter of history by now - and that could've forced a series of 'changes of plans' - this being one quick fix.

Yes, I'm speculating.

 

[MoparNorm]

I'd think the VEBA share price litigation and the judge taking over a year to decide what should have been a 90 day decision, contributed a lot to the drawn out time frame.

BTW, those Dodge dump trucks drove very nicely, and the Bighorn (I think that's what the big highway truck was called...I still have a brochure of one), was ahead of its time. Oh well....

There still are, 50 years later, a few of those Bighorns and D and W 500's working. An amazing tribute to the Dodge Truck engineers of the 1960's. these were not disposable trucks.

 

[patfromigh]

the name pro-master is just stupid though. Marketing needs new people, it seems.

We have to give them slack on the Promaster name. Fiat Professional is the brand name throughout the world. They couldn't use Ram Professional because GM owns the rights to the "Professional" name. Ever since the early days, the Cadillac chassis sold for limos, ambulances and hearses was often referred to as the Professional.

 

[MoparNorm]

We have to give them slack on the Promaster name. Fiat Professional is the brand name throughout the world. They couldn't use Ram Professional because GM owns the rights to the "Professional" name. Ever since the early days, the Cadillac chassis sold for limos, ambulances and hearses was often referred to as the Professional.

Did Dodge (Truck) retain the rights to 'Tradesman', 'Sportsman' and 'Town Wagon'?
Those were the traditional Dodge names given to Dodge panels and window vans.

 

[fargo59]

heck "ram van"...