Chrysler Group LLC plans to scale back its minivan lineup in the North American market as it eliminates duplication on the showroom floor.
The auto maker will feature only the Chrysler Town and Country in the U.S. market and likely just the Dodge Grand Caravan in Canada by 2013, as well as develop a so-called people-mover that will try to entice customers who want the space of a van, but the fuel economy and more distinctive styling of a crossover utility vehicle.
“We cannot have the same type of vehicle in the showroom because the customer is not stupid,” Chrysler chief executive officer Sergio Marchionne was quoted as saying in Monday’s edition of the trade publication Automotive News.
The move is the latest evolution of what has been one of Chrysler’s most important vehicle lines in the past three decades. Chrysler, which introduced the minivan in the 1980s and makes all those vehicles at an assembly plant in Windsor, Ont., has maintained its lead by introducing such innovations as a driver’s side sliding door, automatic lift gate and second-row seats that swivel.
But the segment has declined steadily since the 1990s – when North Americans bought more than one million minivans annually – as crossovers became the hottest selling vehicles in the market.
“The challenge with the van is the [soccer Mom]stigma,” said one senior industry executive. Enter the people-mover, which will be built off the same platform or basic under-body as the minivan and carry seven people, as minivans do now.
In the current lineup, the Town and Country is the more luxurious offering, while the Grand Caravan is more basic.
The Grand Caravan is the second-best-selling vehicle in the Chrysler Canada Inc. lineup, behind the Dodge Ram pickup. It is the third-best-selling vehicle in Canada over all, behind the No. 2 Ram and the Ford Motor Co. of Canada Ltd. F-series pickups.
Grand Caravan sales rose 3 per cent in Canada in the first nine months of 2011 to 44,044 units. For every 10 Grand Caravans that Chrysler Canada sells, one Town and Country rolls off dealers’ lots.
The Dodge version is also outselling the Chrysler version in the U.S. market this year – 85,830 to 71,917 – but traditionally the Town and Country has been more popular south of the border.
“They’ve been consistent in talking about moving further away from duplicate product,” said David Kelleher, a Chrysler dealer in Philadelphia. “Buyers get confused when they see two vehicles that are almost the same but sold by different brands on the same lot.”
One Chrysler dealer in Western Canada said the two minivans and the Dodge Journey crossover are aimed at the same customers. Ending product duplication and using the money saved to improve quality makes sense, the dealer said.
The long-term plan before Chrysler LLC went into Chapter 11 bankruptcy protection in 2009 was to shift to a single minivan strategy, but that was derailed by the 2008-2009 auto crisis, said a former Chrysler official.
Mr. Marchionne mentioned several months ago that he wanted to scale back the auto maker’s minivan offerings, said Ken Lewenza, president of the Canadian Auto Workers union, which represents about 4,500 workers at the Windsor plant. The plant is running on three shifts a day, and also assembles a version of the minivans that is sold by Volkswagen AG as the Routan.
Mr. Lewenza said it doesn’t matter what workers build in Windsor as long as the plant keeps operating on three shifts. “That’s all the matters to me,” he said.
Ford and General Motors Co. no longer sell minivans.