Wednesday, September 30, 2009

Chrysler's credibility challenge

An auto company high executive who shall remain unnamed chuckled when asked about the competitive prospects of Chrysler:

"What's their market share, 7%? And what do they have to sell for the next two years besides the Ram [pickup truck] and the minivan? Their first new car after that will be the Fiat 500? How many of those are they going to sell? Fiat hasn't sold so much as a bicycle here for 20 years."

Though harsh and a bit off the mark (Chrysler's market share is closer to 9% nine percent), the executive's comments neatly summarized the challenge faced by CEO Sergio Marchionne and his executive team as they try to reestablish Chrysler as a credible choice for consumers in the U.S. market.

It won't be easy. Turning around car companies takes time -- three years to develop a new model -- and money -- up to $1 billion for a new car or truck and the tools and machinery to build it with.

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