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Mix of Detroit brawn, Italian flair rev lineups

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Mix of Detroit brawn, Italian flair rev lineups

Alisa Priddle / The Detroit News

The idea is simple: Marry the car and truck plans for Chrysler Group LLC and partner Fiat SpA, excite buyers with a mix of American muscle and Italian pizzazz and revitalize the bottom lines of both automakers.

The execution is far more complicated, and decisions are still being made. But a Detroit News analysis of the five-year plans of Chrysler and Fiat reveal how portfolios are shaping up.

American consumers can still expect to find familiar, home-grown favorites: Ram trucks, minivans and Dodge's Viper.

But replacements for cars such as the Chrysler Sebring and Dodge Caliber will be Fiat-engineered and may be Italian-built -- with roots to such exotic models as the Alfa Romeo Giulietta on sale in Europe.

Names only vaguely familiar to Americans -- Fiat, Lancia and Alfa Romeo -- will be available at neighborhood Chrysler dealers.

"It will be an interesting showroom when it's complete," said Tracy Handler, market analyst for IHS Global Insight in Troy.

The goal is to boost sales for both automakers and have the combined capacity to produce 6 million vehicles annually by 2014, up from about 3.3 million now.

A robust portfolio will help Chrysler generate revenue to finance continued vehicle development and repay taxpayer loans.

The automaker will leverage Fiat's presence in Europe and Latin America to penetrate those markets; Fiat, in turn, needs Chrysler's help to become a full-line automaker in North America.

Eyeing global market

The smallest of Detroit's automakers, Chrysler has always been the most domestic, failing to establish much of a global foothold. But that's changing.

Sergio Marchionne, chief executive of both automakers, estimates Chrysler will build 300,000 vehicles in Europe for U.S. export, and 400,000 in North America for shipment abroad by 2014.

Marchionne seems to be whipping his product plans into shape very quickly, said Rebecca Lindland, director of auto industry research for IHS Global Insight.

"Italian-designed cars will be an all-new thing and give us a good idea of how Chrysler is coming," Lindland said.

Chrysler needs new products from the alliance quickly so the company that was "in danger of going under" can rebuild.

But it is not a one-way street between Turin, Italy, and Auburn Hills. Fiat will depend heavily on Chrysler's success.

Of 51 new or refreshed vehicles for Europe by 2014, a third will come from Chrysler. Of 34 all-new cars and trucks on that list, 13 will be assembled in North America.

If the euro goes soft, Chrysler will become more important to Fiat, said auto expert Jim Hall of 2953 Analytics in Birmingham.

"It could be stable capital for them," he said.

Chrysler also provides Fiat with a critical entry point into North America, said analyst Joe Phillippi of AutoTrends Consulting Inc. in Short Hills, N.J.

"Fiat had no opportunity here beyond a few Ferraris and Maseratis sold in the U.S.," he said. "To be successful, you have to be in North America. It represents about 25 percent of the global market they're not touching at all."

Hall said unlike its previous owners, "Fiat wants and needs Chrysler and sees a value in it."

But time is of the essence to capitalize on the rebounding market. Industry sales through May rose to 3.5 million vehicles from 3 million a year ago.

"You don't want to be on the sidelines," Lindland said.

Lancia is critical anchor

Marchionne has no intention of being on the sidelines. His global vision for the two automakers is an intricate mosaic.

The biggest melding will be the Chrysler and Lancia brands.

Lancia cars will be sold with Chrysler's winged badge in North America. Lancia will become a full-line brand in continental Europe by rebadging Chryslers; the vehicles will be sold in 1,000 combined Chrysler/Lancia dealerships by 2014 with a goal of 295,000 annual sales by 2014.

Future products are being developed for both brands. By 2014, Lancia will have 18 products: six based on high-end Chryslers.

The Fiat brand will get 10 new and six refreshed vehicles over five years. Some are for North America, where Marchionne forecasts 20,000 annual sales by 2014, excluding 100,000 Fiat 500s to be made in Mexico for sale in North America and Latin America.

Alfa Romeo gets seven new products and two refreshed models as it prepares to return to the U.S. market by 2012 with a goal of 85,000 annual sales by 2014. A new Ferrari and an entry-level Maserati will join the lineup.

Jeep is a global brand and will expand in Europe with three new models produced by Chrysler and refreshed versions of three Jeeps.

Dodge will retain a purely American identity and remain a full-line brand in North America. Elsewhere, only models "consistent with the strong American image of the brand such as the Challenger, the Charger and Viper will be distributed," Marchionne said.

"We like the product plan a lot," said William Pochiluk, president of consulting firm AutomotiveCompass LLC in Philadelphia. "The issue is how you get there."

Hall said the plans say more about what Marchionne wants than how he will accomplish it.

"The devil is in the details," Hall said, "and implementation is key."

From The Detroit News: http://www.detnews.com/article/20100602/AUTO01/6020345/1148/auto01/Mix-of-Detroit-brawn--Italian-flair-rev-lineups#ixzz0phRiJWuz

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