Sergio Marchionne Talks Chrysler At NAIAS

by , Jan 13, 2014, 2:50 PM
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Chrysler has a lot going on right now, with the launch of the 200 sedan, totally reinvented and unveiled on Monday in Detroit -- and of course, the brand new, completely reinvented Chrysler LLC, now owned in toto by Fiat SpA via a $4.35-billion deal with the UAW’s Retiree Medical Benefits Trust.

At the North American International Auto Show in Detroit, CEO Sergio Marchionne, speaking to reporters, said questions about where headquarters will be are irrelevant.   

"I think we need to be careful when we try to define 'headquarters' for car companies because the way in which we have structured the company is that we have operations across the world," he said, adding that the headquarters siting is almost irrelevant because decision making is delegated to regions. The U.S., he said, will play a major role because 50% of combined volume will be there, and Italy will play a big role for the company because of the brand's premium-car history, technology and capacity around Alfa Romeo and Maserati. "But headquarters is a bad term. It's a bit of an antiquated word. I spend lots of time on airplanes, and the group executive council travels. Where that group meets is where it's executed."

Among upcoming product programs is the new Wrangler, which hasn't been redesigned since 2006, and desperately needs a weight loss plan if the company is going to meet fuel-economy goals. But Marchionne made it clear that the word "redesign" is off the table for the vehicle, which is one of the relatively few cars that warrant the way-overused benediction "icon." 

"This is the riskiest thing we can do,” he said. “If substantially upgrading Wrangler to reflect advancement in technology means taking away any capabilities, then we have killed it." He said the vehicle must, however, be a lot lighter and enjoy an improved powertrain -- and yes, get an update in design and style, "but we must do this without touching the fundamental elements of the car." 

Marchionne said implementation is fewer than two years away, and the company is committed to never taking production of the Wrangler outside of Toledo, Ohio. He said the same thing goes for Cherokee, which is built out of Chrysler's Jefferson North facility in Detroit. That could be tough, given Chrysler's global ambitions for Jeep. "A challenge for us is the internationalization of Jeep while preserving as many U.S. installations as possible," he conceded. 

And he repeated a truism that keeps auto marketers up at night, or should: a tier-three player in the auto mass market is a bit like one of those subatomic particles that lasts for a millisecond and vanishes. "If you are a small guy making a couple of million cars a year, you should start worrying. You can't be a guppy in a world of sharks. I don't think the shakeout is over; the rationalization of the industry isn't over," he said.

The recovery of the Detroit Three should keep that particular dog off some heels in Motown. "There was a stench of death on the stands [at the auto show] in 2008," said Marchionne. "Now all of us have come back in vibrant ways with renewed products. There isn't a single guy out there [among the Detroit automakers] who today is ashamed or embarrassed or inadequate versus everyone else. It's been a five-year travel. Today's a good day. Lazarus has risen."

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