Fiat Is Re-Re-Reintroducing Chrysler Brands in Europe
Part of the grand scheme of the Fiat-Chrysler merger is to use the Fiat Group (FIATY.PK) dealer network to give Chrysler brands access to European markets. Great idea, although Chrysler has so far failed to make much of a dent in Europe, even though it's been trying off and on for nigh on 30 years.
Today, of course, Chrysler is utterly dependent on the U.S. market. If that single market falls -- like it did in 2008 and 2009 -- Chrysler is uniquely vulnerable. Chrysler neatly illustrated this by going bankrupt last year. Unlike General Motors, the Obama Administration refused to bail out Chrysler until Chrysler hooked up with a partner; enter Fiat.
Getting Chrysler brands into European markets is a sound idea but hard to execute, since Chrysler is best know for pickup trucks, SUVs and minivans. None of those is especially popular in fuel-economy-conscious Europe, at least not in the giant-size versions Americans loved until recently.
It helps that in the last few years, Jeep and Dodge have added smaller, crossover SUVs in the lineup. They're still pretty large by European standards, but more in line with European expectations for size and for fuel efficiency. The newest Jeep Grand Cherokee is also more fuel-efficent than the model it replaced. In the longer term, Chrysler and Fiat are expected to share smaller, more fuel-efficient platforms.
In its latest quarterly report, Fiat reported it started distributing Chrysler, Jeep and Dodge vehicles in Italy, France, Germany, Sweden, Denmark, the Netherlands and Belgium.
Good luck with that, because it's a nut Chrysler has been trying to crack for decades with different partners, most recently through the failed DaimlerChrysler merger. Daimler dumped Chrysler in 2007, without generating much enthusiasm for Chrysler products in Europe.
Chrysler used to have its own European subsidiary, but Chrysler hasn't been much of a presence in Europe since at least the mid-1980s. That's in contrast to the giant European subsidiaries of Ford (F) and General Motors.
PSA Peugeot Citroen (PEUGF.PK) bought out Chrysler Europe back in 1978. Products for the resulting merger included a joint venture with Fiat. Chrysler's former European subsidiaries took the name Talbot in 1979. The brand was another also-ran, however, and production of Talbot models ended in 1986, according to PSA Peugeot Citroen.
Meanwhile, the new Chrysler-Fiat partnership began in May 2010 to integrate Chrysler into the European sales network for Fiat's Lancia brand. The joint network is expected to have more than 1,000 dealerships in Europe by 2014. Whether Europeans will come in and buy Jeeps, Chryslers and Dodges is another question.
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Photo: Chrysler