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AUBURN HILLS, Mich. (AP) – Chrysler sold more than 118,000 Sebring sedans in 2001. Eight years later, the automaker barely sold 27,000 as its bankruptcy filing sent customers fleeing to the car’s newer, better competitors.
Chrysler now has a turnaround plan that promises improved quality and a stream of new models. But it won’t work unless Chrysler can get cars like the Sebring back on people’s shopping lists. To do that, Chrysler is going back to the basics: Reinventing its car brands – Chrysler as a luxury line, Dodge as a quirky value brand – and reintroducing them with head-turning ads.
It’s a tall order, but Chrysler insists it can be done.
“We’ve had troubles. Yeah. We saw death. But the whole world needs to realize we’re serious about this plan,” Dodge brand chief Ralph Gilles told The Associated Press in a recent interview. “We’re no dummies. We know what a good car is and what a good car isn’t.”
Chrysler’s truck brands, Jeep and Ram, have strong identities in buyers’ minds. But its car brands are mushy, said Allen Adamson of the San Francisco-based branding firm Landor Associates. One of Chrysler’s first actions under Fiat SpA, which took control of the automaker last year, was to split Ram truck from Dodge so Dodge could stand alone.
“What they need to do is quickly define what they want to stand for and then build on it,” Adamson said.
Dodge will try to make a big splash with an ad during the Super Bowl next month. Chrysler Group LLC, which has yet to pay back $15.5 billion it borrowed from the federal government, is taking some heat for paying an estimated $5 million to air the ad. But the company says it’s the best forum to explain Dodge’s transformation.
Most consumers identify Dodge with its old ram’s horn logo, but Gilles wants it to be known for cars and minivans like the Grand Caravan, which is now the brand’s best-selling vehicle.
Gilles, the 40-year-old son of Haitian immigrants, is the designer of two of Chrysler’s most distinctive and popular vehicles: The Chrysler 300, reminiscent of a 1940s sedan, and the muscular 2009 Dodge Ram pickup.
He said Dodge offers innovations – like in-floor storage bins and built-in drink coolers – at a value price. The Grand Caravan starts at $23,995, compared to $26,805 for a Honda Odyssey.
But he also wants Dodge to be known for the sporty, aggressive feeling epitomized by the Dodge Challenger sports car, which looks more at home on the dirt roads of Hazzard County than the parking lot of the local mall.
“People buy Challengers because they’re emotionally drawn to them, because they make them feel good,” Gilles said. “That’s really what I’m looking for. I think it’s possible to have the ‘gotta have it’ thing in every car.”
Gilles, who has an MBA, said car companies generally cast a wide net for buyers, but that leads to vanilla styling. He’s targeting “the expressive types, who are a little bit quirky.”
“I want to purposefully aim off the bull’s eye, find a concentrated group of customers whose needs aren’t being met right now.”
The Chrysler brand, too, is aiming off the bull’s eye, but it’s trying to lure well-educated, sophisticated buyers. One of its first new ads, which aired on news channels, called for the release of Burmese human rights activist Aung San Suu Kyi. Another in production inserts a Chrysler 300 into a scene from “Breakfast at Tiffany’s.” Both are stylish and provocative.
They’re the brainchild of Olivier Francois, a 48-year-old Frenchman in dark Levi’s who heads the Chrysler brand and its European twin, Fiat’s Lancia brand. He also controls marketing for the entire Chrysler Group.
Francois, who sold music in Taiwan and Citroens in Denmark before leading a turnaround of Lancia, sees the U.S. market share of Chrysler brand rising to 5 percent from its current 2 percent. So if 95 percent of buyers don’t understand his ads, he’s content.
“I prefer 5 percent loving it – loving my cars, loving my colors, loving my Detroit auto show stand, loving my advertising – then 50, 60, 70 percent saying, “Eh. It’s OK,” he said. “It will take years, but it will give a different feeling about the brand.”
His influence was evident at this month’s Detroit auto show, where scantily clad models vamped next to the Fiat 500 minicar and Lancia Delta sedan. European shows often use models, but they’re rare at U.S. ones.
Francois wants to bring Chrysler to the level of Lancia, which has similarly elegant styling but sells for a 15 percent to 20 percent premium over Fiat. By contrast, the starting price of a Chrysler Town and Country minivan is less than 10 percent more than a Dodge Grand Caravan.
He also wants to increase Chrysler’s international sales. Sedans like the 300 can fill holes in Lancia’s lineup, while the Fiat 500 will join Chrysler’s U.S. offerings in 2011. The brands will share marketing and development costs.
Francois and Gilles said there’s a new enthusiasm at Chrysler after its emergence from bankruptcy court and the end – for now – of its revolving series of owners. Daimler AG owned Chrysler for nine years before selling it to private-equity firm Cerberus Capital Management in 2007.
But how long will it take to rebuild the brands? Fiat CEO Sergio Marchionne, who hand picked Gilles and Francois, hasn’t seen it done in less than two years but wants to break that record. Analysts are skeptical.
“They’re pulling out all the stops, but even two years in this industry can seem like 20,” said Erich Merkle, president of the auto industry consulting firm autoconomy.com. He points out that a product turnaround at Ford Motor Co. is just now showing results after five years.
Chrysler’s U.S. market share fell to 9 percent in 2009, a 30-year low. Marchionne doesn’t expect sales to start climbing until the release of the new Jeep Grand Cherokee this summer.
But Gilles said Chrysler controlled 13 percent of the market just three years ago and knows how to get back. The new Dodge Charger and Chrysler 300 sedans coming this year will prove doubters wrong, he said.
As for the Sebring? It will be replaced with a Fiat in 2014.
AP Business Writer Emily Fredrix in Milwaukee contributed to this report.