DaimlerChrysler aims to turbocharge its sales New LX series will be up against Camry and Accord
Paul Brent Financial Post
Friday, December 05, 2003
CREDIT: Peter J. Thompson, National Post
The Brampton, Ont.-built Chrysler 300 sedan will be a key to whether DaimlerChrysler can arrest its years-long market share slump.
The most important vehicle introduction in Chrysler Corp.'s 2004 "product onslaught," the Brampton, Ont.-built Chrysler 300 sedan and Dodge Magnum wagon, will be a key determinant as to whether the North American unit of DaimlerChrysler can reverse a years-long market share slide.
The facility an hour's drive from Toronto is currently building prototypes of the macho-styled vehicles in the runup for full-scale production next month, which will end a four-month shutdown at the assembly plant.
The new rear-wheel-drive sedans and wagons termed the LX series, replace the venerable LH line of front-wheel-drive cars (Concorde, Intrepid and 300M) and will fight for sales in a hotly competitive passenger car market now dominated by imports such as the Toyota Camry and Honda Accord.
"Dieter Zetsche [Chrysler Corp.'s chief executive] is watching this one like it's a newborn baby," said Bob Chernecki, assistant to the president of the Canadian Auto Workers Union, responsible for Chrysler's operations in Canada. "[Chrysler] has the truck segment obviously but this one is critical. I have never seen them do so much work as they have on this product."
Chrysler, which at the height of the LH's success built 340,000 of the sedans a year at Brampton, will begin production of the new cars with two shifts and 2,700 production workers, which one analyst said will give them an annual production rate of 200,000 to 210,000 vehicles.
Mr. Chernecki is optimistic about the new vehicles' chances in the market. "I can't envision a third shift unless this thing really takes off, but it might," he said, nothing the cars will contain 20% Mercedes parts from its German parent company, a fact dealers should emphasize.
Chrysler executives were unwilling to predict volume figures, still smarting from optimistic predictions for the Windsor, Ont.-built Pacifica, which sold slowly in its first months because only the priciest versions were initially offered and the marketing campaign featuring singer Celine Dion failed to talk about the features of the station wagon-minivan hybrid.
Chrysler has not yet disclosed pricing for the new cars, but in the U.S. has said the vehicles were to be priced from US$25,000 to US$35,000.
Without mentioning the difficulties with the Pacifica, Chrysler said a full-range of the passenger cars will be sold, with three different engines up to the 5.7-litre, 340-horsepower V8 engine which will propel the sedan and wagon from 0-60 miles an hour in 6.5 seconds. The company said 30% to
40% of the Brampton vehicles will be powered by the 5.7-litre "Hemi" engine.While Chrysler said quality is crucial to the new vehicles' success, the company will not be selling the vehicles on reliability and dependability like many of its competitors. "We are a styling company. That is the whole idea behind this place," said Frank Ewasyshyn, senior vice-president of advanced manufacturing engineering.
"It's sexy, great, fantastic design," said Mr. Ewasyshyn. He added that Chrysler was able to essentially build an entirely new plant, a flexible new facility in Brampton for a bargain investment of $1.4-billion by reusing robots, conveyer belts and other machinery from Brampton and other plants. "Our job is to take that and say, 'Now we have to build that in a plant that is flexible and a lower capital investment that we have ever had.' [But] we won't sacrifice that product side of our business. No, I think we have got a heck of a lot smarter."
Chrysler's U.S. sales this year through November have fallen 4% from a year earlier to 1.94 million vehicles, led by a 13% drop in sales of Chrysler-and Dodge-brand cars.
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