FCA shows US dealers near-term new products

Fiat Chrysler Automobiles (FCA) held its annual dealers' meeting in Las Vegas, Nevada, United States, this week, including showing new products to energise dealers, according to media reports. The media was not invited to the event, with reports relying on comments from dealers and others who were in attendance.

Among the new products shown were a Dodge Barracuda convertible and an all-new Dodge Charger. Both will reportedly be based on the RWD platform under the Alfa Romeo Giulia. Also shown were the next-generation Jeep Wrangler, said to stay true to form, a Jeep Grand Wagoneer eight-passenger sport utility vehicle (SUV), and the Jeep Grand Cherokee SRT Track Hawk, sporting the 6.2-litre Hellcat V8 engine. Missing from the line-up was a Jeep Wrangler-based pick-up truck. From the Italian brands, FCA showed both standard and Abarth versions of the Fiat 124 Spider, based on the Mazda MX-5 (see United States: 21 August 2015: Fiat could reveal 124 Spider this year – report), as well as an upcoming Alfa Romeo SUV. Along with these products, some reports indicate that Chrysler showed its upcoming minivan and a E-segment SUV, with a plug-in powertrain.

During FCA CEO Sergio Marchionne's presentation, he told dealers that efforts to merge FCA with another company would not impact brands, would not reduce the size of its manufacturing workforce, and "does not require a rationalisation of the distribution network".

Outlook and implications

Media reports covering the event state that the dealers were promised these new products within the next two years, and the products are part of a strategy including 30 new or refreshed products during that period. The presentation to US dealers covered plans specific to the US auto market. While some of the plans reported to have been discussed were announced with the five-year plan unveiled in May 2014 (see World: 4 May 2015: FCA looks to reach 7 mil. global sales in 2018), there seem also to have been some adjustments. In addition, the meeting provided Marchionne with the opportunity to present to most of his dealership principles, rallying the troops with reminders of the success in increased sales the company has witnessed and addressing concerns that might have arisen from his public comments on potential mergers (see United States: 12 May 2015: FCA report encourages more component sharing, R&D and production synergies between OEM Groups and United States: 8 May 2015: FCA US reports USD2.6-bil. net income, revenues of US20.9 bil. in Q1). IHS Automotive forecasts that the total of these and other product actions will bring FCA's US sales, including those of Ferrari, to 2.2 million units in 2018, with sales being impacted during 2019-21 by a downturn for the US industry.

Reports indicate that the dealers' body was largely happy with what was presented. However, some of the products alluded to and shown had earlier been reported to have been delayed or cancelled. With rumours of delays ongoing, the launch timing of some of these products may be adjusted (see United States: 29 June 2015: Jeep CEO confirms Grand Cherokee redesign delay; Chrysler to build model in China and North America: 3 June 2015: FCA delays key model programmes in North America).

FCA has earlier promised that Dodge product launches in 2016-18 will include a new Dart, a new D-CUV to replace the Journey, a refreshed Durango, and, in 2018, a new B-segment sedan and hatchback, as well as an E-segment sedan and coupe. It is uncertain if the presentation mentioned these vehicles, though the Charger and the Barracuda are likely to be the E-segment vehicles reportedly referred to in it. Using the Alfa Romeo platform as a base for these products is not a particular surprise, though it had not been previously reported. Even including some new products, IHS forecasts the loss of the Caravan, decreasing sales of the Journey, and the focus on Dodge as a performance brand will all contribute to the brand's sales declining from about 495,000 units in 2015 to 310,000 units in 2019, as Dodge ultimately becomes more of a niche brand than a mainstream brand.

In the Jeep plan from May 2014, the Grand Wagoneer is planned for mid-2018, after a mid-2017 all-new Grand Cherokee. In addition, the Wrangler is due in early 2017. Jeep's plan also includes a C-segment SUV to replace both the Patriot and the Compass in 2016; it is not clear if that vehicle was teased out or not at the dealers' meeting. Other than the Grand Wagoneer, Jeep has not indicated publicly any plans to expand its range. However, IHS sees the possibility of a Wrangler-based pick-up being introduced in 2018. That brand's US sales have significantly benefited from current boom in SUV sales, though we forecast a peak in 2017 at 856,000 units, pulling back to about 787,000 units in 2019. The Hellcat-powered Track Hawk effectively replaces (and boosts) the former SRT8 Grand Cherokee; the SRT badge was for a short time made standalone, but has been returned to Dodge-only applications. This does not, as the Track Hawk suggests, mean that only Dodge will get performance cars but rather that other go-fast vehicles at FCA dealers will wear different names.

Chrysler's all-new minivan is due in 2016, and has been scheduled for both a plug-in hybrid electric vehicle (PHEV) variant as well as for the platform to spawn a full-size crossover in late 2017. Chrysler has also been scheduled for a 100 sedan; however, although it remains in the IHS Automotive forecast, its sales launch is now expected in autumn 2019. The long-term future of the 300 is unclear, though if a successor is developed outside this 2018 window, it may well also use the Alfa platform. IHS currently forecasts Chrysler's sales will increase from 328,000 units in 2015 to about 465,000 units in 2019 and 608,000 units in 2021, with a D-segment CUV also expected to arrive in 2020.

Alfa Romeo's Giulia and Giulietta are both due to be launched in the US in 2016, with the Giulia having recently been introduced in Italy (see United States: 3 April 2015: Sedan, SUV due from Alfa Romeo for US by 2017 – report). In its original plan, Alfa promised only a broader product showroom would arrive between 2016 and 2018, and that it would include two new compacts, a mid-size and a full-size product, two utility vehicles, and one specialty product. Initially, the specialty product was expected to be the Mazda-based roadster, but Marchionne later moved that product to Fiat, drawing a line in the sand that all Alfas must be produced in Italy. The current IHS forecast for Alfa Romeo's US sales include the Giulia and a Giulietta replacement arriving in 2016, along with a D-segment SUV, followed by a C-segment SUV and a convertible in 2017, then a C-segment coupe in 2018. This ambitious plan sees several products being rolled out in a relatively short window. IHS forecasts Alfa's sales will have a difficult time reaching the FCA target of 150,000 units per annum in the near term, but we do forecast the brand's sales growing to nearly 94,000 units in the US in 2021.

It is not clear if FCA discussed plans for Maserati with the dealers' body, but the company has earlier discussed an SUV due in 2016, expected to be called the Levante and sharing a platform with Alfa Romeo. The Levante is the only additional product we see scheduled for Maserati, however. After seeing strong sales in 2014, 2015 has been more of a struggle for Maserati in the US, further compounded by more sales of the less-expensive Ghibli than the Quattroporte. IHS forecasts the low-volume luxury brand will see US sales of around 15,500 units per annum by 2018.