Chrysler Canada Boss Anxious for Small Car; Expects Moderate H2 Sales

Expect Chrysler Canada to capitalize on its market-leading sales momentum when the auto maker introduces its all-new small car next year, says Chrysler Canada President and CEO Reid Bigland.

Through June, the auto maker’s sales were tracking 15% ahead of like-2010, far surpassing the industry’s 2.6% uptick, according to Ward’s data. In addition, Chrysler’s 1.6% market-share jump to 15% was the largest gain by any auto maker.

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“That’s without a strong C-car,” Bigland tells Ward’s, referring to Chrysler’s current and only entry in the segment, the Dodge Caliber, which finished 26th in Canada’s June car-sales race.

Next year will see the debut of the first Chrysler-family vehicle to directly benefit from alliance-partner Fiat’s small-car prowess, a Dodge C-segment sedan derived from the same platform that shoulders the highly acclaimed European-market Alfa Romeo Giulietta.

Bigland can barely hide his enthusiasm. The small-car market “is just so massive that having a new, technologically advanced C-segment vehicle coming into the Canadian market is going to be a very welcome addition to our portfolio,” he says.

Small Cars, as defined by Ward’s segmentation, account for 29.3% of the Canadian market, compared with 20.1% for the neighboring U.S.

Through June, eight of Canada’s 10 best-selling cars were compacts, led by the Honda Civic. With six models in its top 10, midsize entries dominated U.S. sales.

Bigland is unfazed by the decision to forgo a hatchback in favor of a sedan, even though Canadian consumers tend to regard 5-door designs with more openness than their American cousins.

“If you look at the big guns right now in the C-car segment – Civic, Corolla and Elantra – they don’t have hatches,” he says.

Chrysler still “kicking around” diesel-powered Jeep for Canada, Reid Bigland says.

The Toyota Corolla and Hyundai Elantra ranked second and third, respectively, behind the Civic in Canadian-market car sales through June. Rounding out the top eight spots are, in order, C-segment competitors the Chevrolet Cruze, Mazda Mazda3, Volkswagen Jetta, Ford Focus and Hyundai Accent.

In contrast to projections of a minor second-half sales surge in the U.S., Bigland expects modest growth in Canada.

“I don’t see a surge in Canada, mainly because the Canadian market didn’t fall off to the same extent as the U.S. market,” he says. “The Canadian market has been running fairly stable over the past 10 years, short of the dip there in 2009. I see steady 2%-5% growth.”

Over a full year, that would translate to volumes between 1.59 million and 1.63 million.

If consistent with first-half sales, Canada’s growth will be skewed toward trucks. While car deliveries dipped 1.5% compared with like-2010, truck sales ticked up 6%, according to Ward’s data, which is adjusted for selling days.

Chrysler’s mix paralleled the industry’s, as its car deliveries through June tracked 3.9% ahead of year-ago while trucks recorded a 17.6% gain. And, as with C-cars, the auto maker appears well-positioned to compete.

The ’12 Jeep Wrangler will see its 3.7L V-6 replaced by the 3.6L Pentastar V-6, one of Ward’s 10 Best Engines for 2011.

“That’s going to have a dramatic impact on the power and performance of the Wrangler, as well as the fuel economy,” Bigland says.

Through June, Wrangler sales already were tracking 34.2% ahead of like-2010.

He is guarded when discussing the potential fortunes of a Pentastar-equipped Ram fullsize pickup. Chrysler has not formally announced the move, but former powertrain chief Paolo Ferrero told Ward’s previously the new V-6 will migrate to the auto maker’s volume flagship next year.

“It wouldn’t hurt,” Bigland says.

Powertrains appear to be close to Bigland’s heart, as Chrysler CEO Sergio Marchionne has said the Canadian executive – who also heads the Dodge brand, as of last month – has been badgering the auto maker’s top boss for a light-vehicle diesel application.

Fiat has “a very impressive stable of diesels that they’ve employed in Europe,” Bigland says. “There’s a diesel engine out there in the Fiat portfolio that would be a great fit for the Grand Cherokee.”

Export production of a Grand Cherokee equipped with a V.M. Motori 3.0L turbodiesel V-6 began in spring at Chrysler’s Jefferson Avenue North Assembly Plant in Detroit.

“Diesel in Canada generally runs at par with unleaded gasoline, if not five cents or seven cents per liter less, which just further augments the 30% improvement in fuel economy,” Bigland says.

In 2008, poor U.S.-market sales prompted Chrysler to scuttle a Grand Cherokee version powered by a 3.0L V-6 from Mercedes-Benz. But that SUV “absolutely caught fire in Canada,” Bigland says. “We experienced over 100% improvement in our sales.”

Marchionne acknowledged at this year’s Detroit auto show that a diesel-powered Grand Cherokee was under consideration for Canada. Has Bigland convinced his boss to pull the trigger?

“We’re still kicking it around,” he says.

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