Fiat Chief Shuffles Chrysler Exec Lineup

Discussion in 'General Motoring' started by Jim Higgins, Oct 5, 2009.

  1. Jim Higgins

    Jim Higgins Guest

    Fiat Chief Shuffles Chrysler Exec Lineup
    http://www.businessweek.com/bwdaily/dnflash/content/oct2009/db2009105_270203.htm

    The heads of the Chrysler and Dodge brands are pushed aside as CEO
    Sergio Marchionne moves quickly to put his stamp on the troubled company

    By David Kiley

    Just as Chrysler is readying announcements about new product plans and
    brand positioning, two of the people who were recently appointed to head
    those brands are leaving under pressure.

    The unexpected moves may reflect the dire straits facing Chrysler as it
    struggles to maintain market share and cash flow after emerging from a
    government-assisted Chapter 11 filing. But they also fit with the
    well-known impatience of Chrysler's new CEO, Sergio Marchionne, who has
    a track record at Fiat (FIA.MI) for hasty firings of executives who
    don't follow his direction in lockstep.

    Sources who have worked for Marchionne at Fiat say he swept out many
    executives when he took over that company in 2004 and even fired some
    managers during meetings.

    Chrysler said Peter Fong, who was handpicked by Marchionne out of the
    company's middle ranks last summer to be head of Chrysler sales as well
    as chief executive of the Chrysler brand, is leaving for "personal
    reasons." Marketing chief and Dodge brand chief Michael Accavitti is
    leaving to "pursue other interests." The two were appointed to those
    positions in a significant restructuring of the company in August.
    Sources close to the company say the executives were pressured to leave
    over differences they had with Italian managers who have moved into
    leadership positions since Fiat took a 20% stake in Chrysler earlier
    this year.

    Chrysler's New Brand Chief Is Fiat Vet

    Olivier Francois, a Fiat veteran who recently headed up Fiat's Lancia
    brand, will take over at Chrysler, while Ralph Gilles, chief of product
    design at Chrysler, will take over the Dodge car brand. Michael Manley,
    head of product development and chief executive of the Jeep brand, will
    stay in his post.

    As previously reported by BusinessWeek, Chrysler is breaking the Ram
    pickup out of the Dodge brand and rebranding as "Ram" its trucks, as
    well as future commercial-grade products. Fred Diaz Jr. has been named
    president and chief executive of the Ram brand.

    The move to name Gilles as head of Dodge mirrors a move recently made by
    General Motors to name its head of North American design, Bryan Nesbitt,
    head of its Cadillac brand.

    The timing of Fong and Accavitti's departures follows a disastrous sales
    month; Chrysler's September sales plunged 42%. Also, the company is
    trying to complete a review of ad agencies to create new advertising and
    marketing for Dodge and Chrysler in the fourth quarter and position
    those brands for the longer term.

    Chrysler is in an unenviable spot. Its current products get low marks
    from Consumer Reports' and J.D. Power & Associates' quality rankings.
    The brands have been damaged by the parent's Chapter 11 filing. And new
    products arising from the Chrysler-Fiat alliance won't hit showrooms for
    more than two years.

    Culture Clash

    Sources close to Chrysler said Fong drew fire inside the company for
    reducing incentive spending too much after the federal cash-for-clunkers
    program expired at the end of August. CEO Marchionne is due to lay out
    his product plan to Obama Administration officials this week and will
    have to explain the deep sales drop, as well as the executive churn so
    early in his tenure.

    According to insiders at Chrysler, the early days of the Marchionne era
    have also been marked by some culture clash between Fiat and Chrysler
    executives. That might have been inevitable. Accavitti, for example,
    despite being head of marketing at the company, played a low-key role in
    a round of meetings Chrysler executives recently had with ad agencies.
    Instead, Giovanni Perosino, Fiat group marketing communication director,
    dominated the meetings. And while Marchionne will have final say about
    the selection of agencies and strategies, he was not present for the
    agency pitches. Instead, the work, screened by Perosino, will be
    re-presented to the CEO later this month.

    The appointment of Francois to run the Chrysler brand coincides with a
    strategy hatched by Fiat managers to try and elevate the Chrysler brand
    to the same price and prestige territory as GM's Cadillac and Ford's (F)
    Lincoln, to launch products co-developed by Fiat and Chrysler, and to
    persuade buyers of entry-level cars from German and Japanese luxury
    brands to give Chrysler a look.

    Several of Chrysler's American managers have expressed private
    opposition to the strategy, reasoning that the company would be
    foolhardy to try and quickly move Chrysler—which sells minivans and a PT
    Cruiser selling below $20,000—into luxury territory.

    Ram Brand Questioned

    The decision to split off Ram as its own brand, too, strikes American
    executives as curious. "It is a very European perspective on the
    American pickup truck market," says Earl Hesterberg, CEO of Group One
    Automotive, one of the biggest automotive retailing companies whose
    operations include several Chrysler dealerships.

    Chrysler has been combining its Chrysler, Dodge, and Jeep franchises
    into a single dealer sales network. The company plans to add the Fiat
    500 under its own name to the mix in two years. So splitting off Ram as
    its own brand means the company will be managing five distinct brands in
    one network of showrooms within a few years—six brands, if you consider
    that a selection of Chrysler dealers will also be tapped to distribute
    Alfa Romeo vehicles for Fiat in the U.S.
     
    Jim Higgins, Oct 5, 2009
    #1
  2. Jim Higgins

    MoPar Man Guest

    These dago's are fighting a turf war inside chrysler, running it like a
    mafia.
    Was Marchionne lecturing them in these meetings, making baseball
    analogies, maybe even holding a baseball bat while walking around the
    meeting table?
    That's this week. Who will it be next week?
    Manley doesn't sound like an italian name. He won't be there much
    longer.
    I can't imagine Ram as the name of a division. What name would they
    then give to light-duty pickup trucks? What would they call them? Ram
    what? Dodge Ram is iconic. How would they replace it? This will be a
    real bone-head move, doomed to failure.
    So why does it take 2 years to scrape a Fiat badge off a car and replace
    it with a Chrysler one?
    It would work if Chrysler only sold high-end sedans (no minivans, no
    small cars), and they brought back Plymouth and used it to sell small,
    low-end cars and low-end minivans. Mid-sized, mid-priced cars and
    high-end minivans would still be sold under Dodge.
     
    MoPar Man, Oct 6, 2009
    #2
  3. I like everything I read about Marchione, maybe there is some hope yet.
    The first thing I read about him was that he moved his office down from
    the executive floor to the engineer's floor which means that he is
    putting the priority on building good products. These firings show that
    he is decisive, the only way they can succeed is by radically remaking
    the company. The choice of Giles as head of Dodge is also promising,
    Giles designed the 300 which was the only real hit that Chrysler has had
    in years and the only car that has the potential to be a classic that
    Chrysler has produced in 50 years.

    Clear brand differentiation also makes sense. Chrysler will never be able
    to compete directly in the luxury segment, their dealer network can't
    provide the level of service that luxury buyers expect, but they can
    compete in the near luxury category. I think it makes sense to limit the
    Chrysler nameplate to 300C class products, high style, full sized fully
    equipped cars. Use the Dodge nameplate for family cars, Jeeps would still
    be Jeeps (that was the only clearly differentiated product line that they
    had), and calling the trucks Ram probably makes sense also because it
    means that a Dodge would clearly be a car and a Ram would be a truck.

    The one thing in that story that's disturbing is that they can't get any
    new product out the door for two years. I don't see how it's possible for
    them to survive for two years with their current lineup, and there is no
    way in hell they are going to get a 3rd government bailout. I assume the
    problem is that you can't get a car certified by the DOT in less than 2
    years which seems insane, if a car is safe enough for Europe why isn't it
    automatically safe enough for the US?.
     
    General Schvantzkoph, Oct 6, 2009
    #3
  4. Jim Higgins

    MoPar Man Guest

    He hires and fires people in a helter-skelter way. And you like that?
    They show he made a poor choice in hiring them in the first place. Or
    they show he can't make proper decisions, or let people do their job.
    It's a step backwards for Chrysler design and product development. Who
    replaces Gilles as chief of design?

    Isin't it nice for Gilles that he gets to be head of Dodge and oversee
    Ram being cut away from Dodge?
    It was a hit for some people for the first year or two it was out.

    It's based on the LX platform - an albatros - a heavy chasis dependent
    on expansive and outdated Mercedes components. You can't build a
    decent, fuel-efficient sedan based on that platform. The tonka-toy,
    fisher-price style is no longer popular.
    It's in-you-face styline is anything but classic. It was a novelty
    design, shamelessly copied from Bentley. It's as much a "classic" as
    the PT Cruiser is (or isin't).
    You can't do it with essentially a single model and trick it out with
    different trim options. That's the big problem with the LX-based 300.

    Chrysler had it right with the LHS and the 300M. Those cars didn't have
    to do double-duty by being differentiated into lower-priced versions.
    The 300N could have competed with the best that Lincoln and Cadilac
    offered, and been a serious alternative to mid-class Merc, BMW and
    Lexus.
    It doesn't make much sense. It paves the way to sell Ram at some point
    in the future, along with Jeep. Again, what do you call the current
    "Dodge Ram" ? The Ram - what?
    And that's needed because ... ?
    And I've been saying that for some time now.

    The real reason is the Fiat knows full well that their flagship consumer
    cars (the 500 and derivatives) will fail miserably in the US, whether
    rebadged as Chryslers or not. But that was the card they played as part
    of being given 20% stake in Chrysler for essentially nothing in return
    but mafia-style management. They want to rape Chrysler for as long as
    they can before someone realizes that there will never be a Fiat-based
    Chrysler car.

    Note the very last sentence of the quoted news story:
    This is where Fiat's real interest lies. They wanted an instant US
    dealer network for their high-end vehicles. All this talk about
    providing Chrysler with a small-car platform was just a smoke screen.
     
    MoPar Man, Oct 6, 2009
    #4
  5. Jim Higgins

    Count Floyd Guest

    50 years! What about the '57 300? Some consider it the best of the 300
    series!


    I think it makes sense to limit the
    I agree that Dodge should be the basic line of cars, that is what Walter
    P. Chrysler thought when he bought Dodge in the late '20's.
    The word "Ram" also referred to the engine line, and of course the
    iconic hood ornament on all Dodge cars from the '30's through the '50's.
    I also think that Plymouth should be brought back to market low-price
    cars/vans, again, just like WPC wanted when he came out with the
    Plymouth in the first place.
     
    Count Floyd, Oct 6, 2009
    #5
  6. Jim Higgins

    Count Floyd Guest

    I agree, the Fiat 500 is not right for American tastes. Even when it
    was available in the '50's and early '60's, it was a piece of crap! My
    step-father had one, always fixing it, breaking down, came pre-rusted
    from the factory!
    You are also right about wanting the dealers. I have not seen an Alfa
    since I was in college, so I guess they think that is the way to get
    them back into the US market.
     
    Count Floyd, Oct 6, 2009
    #6
  7. By my calculation 1957 was 52 years ago which was my point. I can't think
    of a single Chrysler product since the 50s except the 300C that could
    draw stares. When my 300C was new (in 05) and I went to a restaurant with
    valet parking they would leave it out front with the Mercedes and BMWs,
    I've never had that happen with any other car that I've owned. I still
    think it's a classically beautiful car even though the lousy Chrysler
    quality is starting to worry me and I have no doubt that in 50 years it
    will draw looks just like a 57 would today.
     
    General Schvantzkoph, Oct 6, 2009
    #7
  8. Jim Higgins

    Count Floyd Guest

    Since I own an original 1941 Chrysler Windsor 4-door, I agree with most
    '50's cars being crap. The only exceptions I would have would be the
    50-52 Chrysler Imperials, the 55 Chrysler/Dodge line and that's about
    it. Never did like the Exner "Forward Look" with the fins. My taste
    runs to flathead engines, both 6 and 8, Fluid Drive, long hoods, short
    trunks. That is one reason that I bought my first new car in years, a
    2003 PT Cruiser sedan, and later, my wife got a 2005 PT Convertible.
    Got rid of them due to trying to make them into something they were
    not(antique look likes to match my 1941),and the poor fuel mileage. Our
    "modern" car is now a 2007 Dodge Caliber, good car, great mileage, and
    A/C! Found out that 45 1941 Chrysler Crown Imperials came with factory
    air, but good luck finding one!
     
    Count Floyd, Oct 6, 2009
    #8
  9. Jim Higgins

    Steve Guest


    REALLY?!? Off the top of my head, I can think of a whole list that
    generated FAR MORE interest than the 300C did:

    -1964.5 Barracuda
    -1967 Plymouth GTX
    -1968 Roadrunner and SuperBee
    -1966-67 Dodge Charger (fastback)
    -1971 Plymouth Satellite and Roadrunner
    -1968-1970 Dodge Charger (Bill Brownlee coke-bottle body)
    -1970 Chrysler 300 Hurst Edition
    -1969 Dodge Daytona
    -1970 Superbird (these two drew more stares than all others combined)
    -1970 Challenger
    -1970 Barracuda
    -Viper
    -1993 Vision/Intrepid/Concorde
    -1992 Ram pickups
    -2008 LX platform Challenger

    If I now had to rank that list in order of how many stares they drew,
    the 300C would do no better than middle of the pack. If that high.
     
    Steve, Oct 7, 2009
    #9
  10. Whether a tiny car like the Fiat 500 will suit the US is one thing, but to
    suggest it is a direct successor of the old little cars is rather silly.

    I am told that Alfas no longer come pre-rusted off the assembly line, but
    they still don't seem to sell well in the UK, even though they look great.
    Too risky for other reasons, I expect...

    DAS

    To send an e-mail directly replace "spam" with "schmetterling"
    ---
    [...]
    [...]
     
    Dori A Schmetterling, Oct 7, 2009
    #10
  11. Jim Higgins

    Some O Guest

    There is a "bit of" a difference between the typical Italian and USA
    driver body size. The Fiat 500 will fit only a few.
     
    Some O, Oct 9, 2009
    #11
  12. Jim Higgins

    rob Guest

    not to mention the size of the streets (Europeans streets much smaller) and
    the amount of distance covered by a American during his/her typical day.
     
    rob, Oct 9, 2009
    #12

  13. Have you sat in and driven the Fiat 500 or are you making assumptions
    about it? I've never even seen one.
     
    Ashton Crusher, Oct 9, 2009
    #13
  14. I was addressing "Even when it was available in the '50's and early '60's,
    it was a piece of crap..." not the relative sizes of lither Italians and
    large Americans.

    DAS

    To send an e-mail directly replace "spam" with "schmetterling"
    ---
     
    Dori A Schmetterling, Oct 9, 2009
    #14
  15. Dori A Schmetterling, Oct 9, 2009
    #15

  16. There isn't a whole lot of real info I could find, like shoulder room,
    hip room, leg room so I couldn't get a good feel for how it might
    "feel". But from what info there is I would agree with the CEO's
    statement that "if done right" it could be a hit here in the US, esp
    with younger people who are not as tied into the "large" car model.
    Even at that, I've found quite a few older people who used to drive
    large cars who have switched to sub-compacts and who love them,
    including my Dad who always used to drive Cadillacs and the like. Now
    he's got a Matrix/Vibe and he loves it. What seems to be the key for
    many people, aside from looks, is entry/exit ease, comfortable seats,
    reasonable acceleration, and good gas mileage. Particularly when just
    about every car now comes with the "luxuries" standard, like electric
    windows/locks and AC. Since lots of new car buyers trade every 2 to 4
    years, if they put a bumper to bumper warranty of 3 years on these
    things it would go a long way to eliminate peoples concerns over
    whether they are going to have problems with them.
     
    Ashton Crusher, Oct 10, 2009
    #16
  17. Yeah, because Mercedes and BMW shoppers stop by the Chrysler showroom
    and look at front-wheel drive cars first.

    Are you forgetting Chrysler under Lido had an arrangement to
    distribute Alfa-Romeos in select Chrysler dealerships? That was the
    time he bought Lamborghini and a part of Maserati.
     
    erschroedinger, Oct 14, 2009
    #17
  18. Jim Higgins

    Some O Guest

    I've had a few Fiat's in that size category in the UK.
    They stood out in that I had to bend my knee around the steering wheel
    to hit the brake. It wasn't safe for me to drive them.
    One was a Fiat Uno 1L , it's gave poor mileage for it's size and only
    made more noise when more power was asked of it.
     
    Some O, Nov 13, 2009
    #18
  19. Jim Higgins

    Josh S Guest

    I'm a FWD buyer, but even if the 300(C) was FWD I'd not be interested.
    I had a Magnum (300 SW) for a two week rental, that was enough.

    One of the best Chrysler cars in the last 50 years is the 300M. A few
    in the service dept at my Chrysler dealer said it first, I agreed.
     
    Josh S, Nov 13, 2009
    #19
  20. Jim Higgins

    Steve Guest


    You GOTTA be kidding! The 300M is one of the best in the past 10 years
    for sure. Maybe the past 20, although I'd rank all of the
    first-generation LH cars qual to the 300M mechanically, and the 2nd gen
    Intrepid and Concorde above it in looks (it looks bob-tailed- ruins the
    long flowing lines the LH series wears so well.) But 50? No way. There
    are many other models that beat it when you get back to the 60s, let
    alone the 50s.

    Don't get me wrong- I don't like the look of the LX 300. I prefer the
    Magnum and Charger and especially the Challenger. But mechanically
    they're all head and shoulders above the 300M. The LX platform is one of
    the best-handling, most rigid, and most stable on the road in its price
    range... from ANY manufacturer.
     
    Steve, Nov 13, 2009
    #20
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