New DC minivans designed to protect market share

A minivan speeds down a tree-lined rural road south of Seattle. A motorcycle police officer, armed with a radar gun and secluded in the woods, gives chase, stops the driver and gives him a ticket.

So much for the notion that minivans are slow-moving boxes on wheels which draw little attention from police officers or anyone else.

The "culprit" is a 2001 Chrysler Town & Country with a 3.8L engine that's 20% more powerful than its predecessor. The Town & Country is part of DaimlerChrysler's new generation of minivans which feature lots of improvements, if not radically different exterior designs.

In Seattle, the automaker previewed its fourth generation of minivans, vehicles intended to protect market share amid some recently tough competition.

Chrysler Corp. invented the minivan. The first debuted in 1983. For years, the automaker dominated the market with a 70% share. But the competition got stronger, particularly the second-generation Honda Odyssey.

Now, DC is looking to guard its share of the market with the new generation of Town & Country, Chrysler Voyager and Dodge Caravan/Grand Caravan.

They are "evolutionary" in exterior design, meaning that designers didn't reinvent the look.

Instead, the main focus is on interior and convenience improvements. Those include the industry's first power up-and-down liftgate; less noise, vibration and harshness (NVH); a pop-up rear cargo organizer and a three-zone climate control system.

On the safety side, engineers added 47 pounds to the front for more structural strength.

And those engines are more powerful - and someone has a traffic ticket to prove it. The 3.3L increases from 158 to 180 horsepower; the 3.8L horsepower from 180 to 215.

Detractors say the minivan's heydays are over. But DC executives note that, after a few flat years, 1999 was a record model year for the minivan segment with sales of 1.6 million units.

DC sales account for nearly 40% of those. It sold 607,000 minivans, nearly 200,000 more than its nearest competitor, General Motors.

"Are we going to grow 30% a year? No, but we're looking at stable growth," says Ralph Sarotte, DC's general product manager for minivan operations. "This market will continue to be strong. It's not going away."

But neither is the competition, such as the Honda Odyssey, which gets glowing reviews and good sales.

"We have to watch the Japanese," says Mr. Sarotte. "But we sold four times more minivans than Honda did. They're strong, though. That's why we got to put on our best show."

DC makes more minivan varieties than anyone else, ranging from the standard-wheelbase basic Caravan and Voyager to the upscale Town & Country priced at $38,000.

The base price of the Caravan/Voyager has been under $20,000 - and will stay that way.

"We're going to keep that price with the new vehicle," says Mr. Sarotte. "It's important to get people in, and hopefully keep them as customers."

There have even been a few modest price reductions, ranging from a $90 drop on a Town & Country LX (now stickered at $25,045) to $245 less for a Dodge Grand Caravan Sport (new price: $24,890).

Meanwhile, prices on some models have increased. For instance, the Grand Caravan GS all-wheel drive is $32,850, an increase of $1,425 and the Town & Country Lxi awd is up $685, to $33,330.

Just about everyone competes in the minivan market's $20,000-$30,000 price range, says Mr. Sarotte.

But DC dominates the lower and higher ends, with 62% of market share for the former and 50% for the latter. (Its mid-range market share is 33%.)

In developing the new generation of minivans, DC carefully followed customer research which said, "Don't step on the basic rules," says Dave McKinnon, DC's minivan director of design

"A lot of our competitors stepped on those rules and paid for it," he adds.

Rules of engagement include chair-height seating, garageable design, easy ingress/egress, second seat access, low flat floors, removable seats and front-wheel drive.

Jim Hossack, an analyst for AutoPacific in Tustin, CA, says that in virtually every sense - ride, handling, powertrain, convenient accessories and safety features - the new batch of DC minivans is better.

He says the styling isn't radically different, but doesn't need to be.

He adds, "I don't think these are `conquest' vehicles as much as `defend-the-share' products. DaimlerChrysler is in a unique position because they sell more minivans than anyone else and the customer loyalty is pretty high.

"When you have that much share, you don't need to take big risks, financial and otherwise, to grab more market share."

But dealer Ken Papa of Papa Dodge in New Britain, CT, says he wished DC was more daring in the minivans' exterior styling.

"Boy, it doesn't look that much different than the old minivan," he says. "I don't know if it will have the eye appeal that will keep customers. You wonder if things like a power tailgate will be enough to draw customers in."

The new Dodge Stratus coupe and the Chrysler Sebring sedan enter the mid-size car market.

The Dodge Avenger coupe and the Chrsyler Cirrus sedan leave it.

DaimlerChrysler is realigning its car lineup for 2001 to leverage the Status and Sebring nameplates.

The Chrysler Sebring had been limited to coupes. Now it gets a namesake sedan, too. Conversely, Dodge Stratus was limited to sedans. Now a coupe is in the Stratus stable. That includes a racehorse, the R/T model with an optional 3.0L V-6 and a 5-speed manual, "a first for us," says Dan Knott, DC's director of small car platform vehicle development.

Ken Papa of Papa's Dodge in New Britain, CT, says dropping Cirrus and Avenger and expanding the Stratus and Sebring lines is a good way to streamline marketing.

"It's a cost-cutting move which they probably should have done a while ago," says the dealer. "It doesn't make sense to spend a lot of marketing money on niche products."

The new Stratus and Sebring models are part of new product blitz that's unprecedented for DaimlerChrysler, says Steve Rossi, vice president of global communications for Chrysler/Jeep/Dodge.

Over the next three years, 80% of DC's lineup will see new products, he says - 30% of that in 2001.

"The Chrysler brand is in the midst of change," says Susan Thompson, Chrysler's senior manager of global customer relations management.

The brand once stood for affordability, family sedans and minivans. "Now it's upscale and cutting edge," she says.

The Sebring and Stratus sedans are part of a $985 million program, says Larry Achram, vice president of large car platform engineering.

They are part of DC's latest assault on the mid-size sedan market. The Toyota Camry, Honda Accord and Ford Taurus dominate that segment. Together, they make up one million of the segment's 3.5 million annual sales.

"The Sebring and Stratus packages are intended to penetrate that market share," says Bob Goldenthal, product planning executive for DC's large car platform.

The new coupes are intended to do their share of share conquering, says Ron Zarowitz, coupe product planning executive.

He says DC with its 2001 coupes is particularly interested in going after that special demographic group - the Baby Boomers.

"We think that as they leave SUVs, they'll get into cars, especially coupes which are the cars of their youth."

He expects the coupe de Boomers will be the more luxurious Chrysler Sebring. Meanwhile, Echo Boomers - that new generation of car buyers - will check out the sportier Dodge Stratus coupe packages.

"We've developed coupes for both those markets," he says. "They are two different flavors of coupes to recognize that diversity."

The Stratus has an aggressive performance look rather than the Euro luxury look of the Sebring, says senior design manager Tom Slanec.

For dealership ordering, there's a new simplicity of option packages, says Mr. Zarowitz. That was accomplished by making many former options standard equipment such as power windows, air conditioning and cruise control.

He says, "That added value takes the hassle out of the buying process and ordering process. Before, if dealers didn't order the exact content a customer wanted, then they'd have to order a new vehicle and wait.

"The simplicity of the option packages drives customer satisfaction because every car has what customers want."