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Discussion Starter #2 (Edited)
It is refreshing to see a CEO talk rationally about costs without berating suppliers or employees.

Tavares told Italian workers that their production costs are 2-4 times higher than those in France and Spain.

Most of us know why.....the volumes in the plants are too low. All the talk about plants being designed for lower volumes hides the TRUTH that low volumes in the auto industry equals inefficiency.

There is a primary reason we see all these mergers taking place for electrification.....the inefficient manufacturers need volume. You do not see the high volume companies pursuing mergers. Toyota does not need a volume partner.

FCA has been struggling with overcapacity at its European factories, with utilization rates at 55 percent, according to LMC Automotive, the Detroit News reported. In comparison, PSA factories run at 68 percent utilization, LMC said.
 

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This is a great opportunity to fill out the lineups of all the brands. This is also a reason for platform consolidation, one factory can produce many vehicles for different brands that are the same under the skin. PSA EMP1/CMP and EMP2 need to be used by every brand.
 

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It is refreshing to see a CEO talk rationally about costs without berating suppliers or employees.
...
FCA has been struggling with overcapacity at its European factories, with utilization rates at 55 percent, according to LMC Automotive, the Detroit News reported. In comparison, PSA factories run at 68 percent utilization, LMC said.
68% ain't great, either.

And I certainly agree re Tavares.
 

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Not surprising. As noted by posters above FCA spent a lot of time pursuing niche products.

The mainstream items they did pursue were not well thought out(Compass, 500L, etc).

This is not a recipe for maximizing efficiencies and even if the labour $/hr were the same as their other plants they'd still be behind because they are producing less and generating less revenue.
 

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Not surprising. As noted by posters above FCA spent a lot of time pursuing niche products.

The mainstream items they did pursue were not well thought out(Compass, 500L, etc).

This is not a recipe for maximizing efficiencies and even if the labour $/hr were the same as their other plants they'd still be behind because they are producing less and generating less revenue.
An MPV isn't mainstream in a US context. Especially when a vehicle under $30K doesn't run on regular gas. FCA just failed to understand the US mainstream market.
 

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It goes back to what I've said many times, in several ways. You need volume if you want good margins (unless you are Ferrari).
 

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That would be great if they put out consistent products that consumers wanted. Maybe less nameplates could be more?
The nameplates are regional, especially in Europe. Half of Fiats are sold in Italy and Brazil, half of Peugeots in France and Spain. Limit the number of platforms, let the top hats proliferate.
 

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The nameplates are regional, especially in Europe. Half of Fiats are sold in Italy and Brazil, half of Peugeots in France and Spain. Limit the number of platforms, let the top hats proliferate.
That I agree with. Opel, Vauxhall, Chrysler and Lancia fit the same markets. They should be co-developed. The large bulk of engineering and design could be all the same with the grilles being different. None of those brands are in any markets together and their style language could be one.
 

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Lancia and vauxhall is very regional and lancia is almost extinct and should peacfully be put to rest ( perhaps they could be sold as a high end version of the low end models but looking at kia wich sells low end models equiped like a high end one for low end prices i doubt it.)
- vauxhall is nothing more than a rebadged opel sold in england, it probably makes sense and money.
 

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That I agree with. Opel, Vauxhall, Chrysler and Lancia fit the same markets. They should be co-developed. The large bulk of engineering and design could be all the same with the grilles being different. None of those brands are in any markets together and their style language could be one.
Opel, Vauxhall and Lancia can share sheet metal. Every car designed to be a Chrysler from the start was over 4.5 meters long, even if it had a 2.5 meter wheelbase. Chrysler needs its own sheet metal until you get to something the size of the Peugeot 308 wagon/408 sedan. Even then the front fenders should be lower since we don't have pedestrian regulations. A Chrysler needs to look American in a way that sometimes won't sell in Europe.
 

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Sharing sheet metal is not efficient. Shipping stamped body panels across the Atlantic is not cost effective.

Sharing on the continent makes sense, but sharing some things across the Atlantic do not.

Therefore, in North America, you will see unique sheet metal.
 
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Sharing sheet metal is not efficient. Shipping stamped body panels across the Atlantic is not cost effective.

Sharing on the continent makes sense, but sharing some things across the Atlantic do not.

Therefore, in North America, you will see unique sheet metal.
I think we will see several small and midsize Chrysler and Dodge cars and SUVs shipped from former PSA factories to the US. The capacity problems and pledges to not cut factories are mostly about outside of North America. This can still be done at a 2.5% tariff. You can't go the other direction on a low margin car with a 10% tariff from the US to the EU.
 

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Discussion Starter #17
I think we will see several small and midsize Chrysler and Dodge cars and SUVs shipped from former PSA factories to the US. The capacity problems and pledges to not cut factories are mostly about outside of North America. This can still be done at a 2.5% tariff. You can't go the other direction on a low margin car with a 10% tariff from the US to the EU.
They may ship some as they already have the regular transit of Alfas and Renegades/500X from Italy to Baltimore.

But North American plants are not running at high enough capacity. We have seen the cutbacks at Brampton, Belvidere, Windsor, etc.

Most plants have excess capacity everywhere.
 
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They may ship some as they already have the regular transit of Alfas and Renegades/500X from Italy to Baltimore.

But North American plants are not running at high enough capacity. We have seen the cutbacks at Brampton, Belvidere, Windsor, etc.

Most plants have excess capacity everywhere.
The thing is PSA EMP1/CMP and EMP2 lines are already set up elsewhere. No Giorgio Global models are in production, and these would be the higher margin models you would expect for US production.
 

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The thing is PSA EMP1/CMP and EMP2 lines are already set up elsewhere. No Giorgio Global models are in production, and these would be the higher margin models you would expect for US production.
I do not want this to be done fast and crappy. We know that typically does not result in good products.
 

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They may ship some as they already have the regular transit of Alfas and Renegades/500X from Italy to Baltimore.

But North American plants are not running at high enough capacity. We have seen the cutbacks at Brampton, Belvidere, Windsor, etc.

Most plants have excess capacity everywhere.
If those plants don't get products, they are in danger of closure. Especially Belvedere and Brampton.
 
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