In 1992, the first-generation Jeep Grand Cherokee played a key role in Lee Iacocca’s plan to revive the Chrysler Corporation’s flagging fortunes. At the time, the popularity of the first Ford Explorer had hinted at the SUV transforming from a niche- to mass-market product, in a class that generated healthy profit margins .
Jeep, with cachet based on 50-plus years of specialized off-roading duty, was the perfect platform for a new kind of flagship vehicle that combined all-road capability with everyday comfort and convenience. More than two decades later, Chrysler is again riding the Jeep brand in general and the Grand Cherokee in particular. With ownership settled by the Jan. 1 deal for Fiat to consolidate ownership with the purchase of outstanding shares held by the UAW’s trust fund, the path is clear “to win back public trust in the company and our products,” in CEO Sergio Marchionne’s own words, from 2009.
In 1998, the company merged with Daimler Chrysler and divorced 10 years later; in 2007 a private equity firm took over the company; in 2009, Chrysler declared bankruptcy and three months later emerged by forming a strategic alliance with Fiat, underwritted by $7.6-billion in loans from the U.S. and Canadian governents. Presently, in an industry fuelled by new technologies and insatiable consumer demand for what’s next, the product line-up is looking long in the tooth, reflecting a lack of investment during times of financial turmoil. For example, it is the only major automaker without a hybrid vehicle. Hybrid versions of the Dodge Durango and Chrysler Aspen were produced and then cancelled in 2008, making it one of the shortest-lived vehicles in modern history. (The Fiat arm does have an electric version of the 500 subcompact.)
Other vehicles in the Chrysler fleet seem long in the tooth when assessed next to direct competitors. The Chrysler 300 — which created such an impact with its unique, gangster-style image when it debuted in 2004 — looks largely the same today and is only in its second generation.
Winning back consumer excitement starts with products like the 2014 Jeep Grand Cherokee. When resources were scarce, leadership made a conscious decision to focus on the Jeep brand over Dodge or Chrysler—a smart move for an erstwhile global company, particularly as emerging markets such as China and Russia were gaining in influence.
Introduced in 2010, the fourth-generation Grand Cherokee shares a platform with Mercedes-Benz, an ironic legacy of a failed relationship. The company’s flagship SUV was refreshed just last year and it now showcases the technologies that are expected of top car makers: an 8-speed automatic transmission, a 4-wheel drive system with driver-selectable settings and a range of efficient engine choices, including a wonderful 3.0-litre V6 diesel.
In driving the Grand Cherokee Summit, it becomes clear that this SUV is a cut above the company’s other offerings. Mechanical attributes aside, there’s an impressive feeling of quality to the Jeep , the sense that no corners have been cut in the development process. The notion of Maserati offering an SUV based on a Chrysler product seems absurd, but it makes perfect sense when that product is the Grand Cherokee—the Levante is due later this year.
Here’s the thing, though: The Grand Cherokee has a base price of some $40,000 in Canada, so, by default, it’s not for everyone. The question remains whether Fiat-Chrysler — now the seventh-largest car company in the world — can replicate Grand Cherokee engineering up and down its product line.
The market responded favourably to the Jan. 1 news however the Italian firm’s bread-and-butter market, Western Europe is only starting to come out of a 20-year low Fiat lost market share and money in 2012 and last year, according to estimates, its factories operated at 41 per cent capacity. As a result, Fiat has relied on cash from Chrysler to keep the wheels turning.
In many ways, this is just the start for the company as it strives to make up for lost time. There are new technologies that require developing, new markets to enter and new decisions to be made about a number of models that aren’t resonating with the consumer—in any market in the world. It’s the earliest of days for the Fiat-Chrysler concern, but the future looks brighter than it did at the end of 2013.
CHRYSLER/FIAT SALES IN CANADA
CARS AND LIGHT TRUCKS
Market share: 14.8 per cent
Increase: 6.7 per cent
Source: DesRosiers Automotive Reports
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