Exec: Chrysler Won’t Cut Corners to Reach Mainstream

GLENVIEW, IL – Chevrolet and GMC may be scaling back powertrain warranties on their ’16 models to 60,000 miles (96,600 km) from what has been 100,000-mile (161,000-km) coverage, but don’t look for Chrysler to follow suit.

“We’re proud we offer 100,000-mile coverage and we’re going to promote that coverage and aren’t going to change it,” says Andy Love, senior manager-Chrysler brand, in an interview at a preview of the ’15 Chrysler 300 sedan here for the Midwest Automotive Media Assn.

As for the new 300 sedan, Love says “we’re almost out” of inventory of unsold ’14 models as dealers switch over to the new ’15 in larger numbers starting this month.

The 300 will help Chrysler become a more mainstream division to compete against the likes of Chevrolet and Ford and less a near-luxury nameplate rivaling foreign automakers.

But that doesn’t mean a change in buyer profiles or demographics, he says.

“It’s hard to bucket or pigeonhole Chrysler-brand buyers, because they are both old and young and come from a variety of cultures. The mainstream buyer isn't going to be a completely different buyer.

“We’re going after people who want style, performance and amenities at a reasonable price, exactly what Walter Chrysler said we were going to do years ago: You have to offer what others do, but at a better price.

“We are going to continue to offer premium features at an affordable price and sell a lot of content,” Love says, noting, for example, that buyers of a ’15 Chrysler 300 with safety features such as lane-departure alert get a free smartphone app that allows them to lock and unlock doors simply by scrolling on the phone screen.

“It used to be that people wanted basic transportation, just to be able to get to work and back. Now they want to get to work and back in style with all the luxury amenities. We even offer a heated steering wheel in the 200,” he says of a feature traditionally reserved for luxury cars.

“When you look at a Chrysler 300 you aren’t going to see a $50,000 or $60,000 car so much as you are going to see a car with a lot of content that starts at mainstream prices between $31,000 and $42,000 that sells at an average of $34,000 to $35,000.”

Although Chrysler is moving the 300 toward the mainstream, the automaker still is targeting buyers of the near-luxury sedans it has rivaled in the past.

“The 300 is for those who want a bigger sedan that fits four adults comfortably, has all the safety features including lane-departure alert, has the same attributes you’d find in an SUV or crossover, gets 31 mpg (7.6 L/100 km) highway and is affordable.”

Chrysler expects such buyers to come from among owners or those considering a Chevrolet Impala, Toyota Avalon, Buick LaCrosse or Hyundai Genesis or “moving down from a BMW.”

While Chrysler looks to become more mainstream by not trying to compete with $50,000 to $60,000 foreign luxury nameplates, Love says it is noteworthy Mercedes is targeting more of its offerings in the $30,000 range.

When it comes to offering SUV attributes in cars, Love says the primary feature is all-wheel-drive, credited for the growing popularity of SUVs and CUVs.

“All-wheel drive accounts for 33% of all 300s sold nationwide, but in the Snowbelt it’s 66% and growing,” he says. “AWD is important, because not all cars offer it, yet AWD is the way for cars to compete with SUVs and crossovers. We’re trying to drive more awareness of it in cars.

“We’ve gotten the word out that the 300 has AWD. But we also have it in the Chrysler 200 sedan in a model under $30,000, and we are trying to get the word out more on that, too,” he says, noting the AWD take rate on the 200 now is only 12% of sales.

While offering the midsize Chrysler 200 and fullsize Chrysler 300 now, coming for 2016 is the compact 100.

“When we get the 100 we’ll have cars in all mainstream segments, and (we) have to in order to compete mainstream” as well as reach the automaker's goal of 800,000 Chrysler-brand sales annually by 2018, Love says.

Jeep sales in February rose 21%, sparked by a 48% gain by Patriot, 31% by Grand Cherokee and 22% by Wrangler. Also in February, Ram truck sales rose 7%, the 58^th consecutive year-over-year sales gain.

Love says lower gas prices have helped spur sales of trucks as well as SUVs and CUVs. “We’ve lost some car sales to trucks and SUVs,” he admits, but insists there’s no reason for concern. “Cars are still a massive segment.”