Marchionne Outlines Future Objectives Following Chrysler Acquisition
Another item on the executive’s to-do list is re-establishing Alfa Romeo as a major player in the global luxury auto industry, he says.
DETROIT – Now that Fiat has purchased the remainder of Chrysler from the UAW’s health trust, Sergio Marchionne, CEO of both automakers, sets his sights on other tasks at hand.
Marchionne tells journalists at the 2014 North American International Auto show here that next on his agenda is the globalization of the Jeep brand, which he says received a disproportionate amount of resources for expansion compared with other nameplates.
“We’re trying to internationalize Jeep in the fastest possible way,” he says, noting Fiat’s purchase of Chrysler opens up the door for the expansion of Jeep at the automaker’s Brazilian assembly plant.
“We’ve been holding up involvement of Chrysler for a long period of time,” Marchionne says. “The resolution with the (UAW trust’s) interest allows Jeep to move at the speed of light in Latin America.”
Another item on the executive’s to-do list is re-establishing Alfa Romeo as a major player in the global luxury auto industry. Marchionne says he isn’t seeking to overtake major players such as Mercedes in market share, but rather he wants just a piece of the market, which has proved fairly resilient to economic fluctuations.
“A large issue, which is extremely important, is to bring back Alfa to a state that it once occupied in the automotive landscape, and we think we can bring it back,” he says. “We’re intensifying (our efforts) now. Not just in the U.S., but on a global basis.”
Despite wanting to grow Jeep and Alfa Romeo, Marchionne says the automaker has no plans to add brick-and-mortar capacity in the U.S. Some products, such as the Jeep Wrangler, have been capacity-constrained as factories run at full tilt.
The executive says he vowed not to add more plants when he took the helm at 2009, and doing so has allowed the automaker to keep residual values high and pricing competitive.
“We kept what we inherited in 2009 and invested in the facilities,” Marchionne says. “You effectively increase capacity within the existing infrastructure when you increase the level of automation. We don’t want to recreate the problems of the past.”
Another important product is the next-generation minivan. The current version is built at Chrysler’s Windsor, ON, Canada, assembly plant, which is under consideration for an investment to build the new product.
Marchionne says the automaker is in discussions with the Ontario and federal governments about the future of the plant, but notes economic incentives and wage concessions by Unifor, formerly the Canadian Auto Workers union, are needed to launch the new minivan.
“We have to resolve this issue,” he says. “Every rational CEO would do that. I’m not going to try and throw the CAW under the bus, but it is one of the concerns that exist.”
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