At the Chrysler Super Bowl XLV supermarket, a rude, honest narrator reflects: “What does Detroit know about luxury?” The best question is: “What do American automakers know about luxury?”
The new Chrysler slogan "Imported from Detroit" implies that they have America's response to luxury European automakers. However, their recently launched line, including the $ 19,245 MSRP 200 Series, shown in the commercial market, ceases to be close to the price, quality and performance of leading BMW, Daimler or Audi.
Chrysler should consider a more ambitious approach to capturing the luxury car market. Looking at the numbers, there is an opportunity for the American automaker to play the game. As the economy rebounded from its lows in March 2009, luxury goods became the strongest return. It is expected that the large three German automakers, including BMW, VW and Daimler, will exceed pre-crisis revenues after adding over $ 90 billion since 2009. [1] Audi, the third largest luxury brand in the world, announced that sales in the United States increased by 20% compared to last year. [2] However, GM, Ford and Chrysler quietly allowed Europe to take over the bulk of the rich US auto market.
Worse, over the past decade, Chrysler’s share of new car sales in this country has steadily decreased from 14.5% to 10.7%, according to Autodata Corp. Their calendar annual sales fell 0.1% from March 2010. When sales fell, as they did at the end of the decade, Chrysler reduced its presence by closing factories and dismissing employees. Unfortunately, this strategy is a short-term solution and does not increase car sales.
A long-term revision of the Chrysler brand will be a difficult and ambitious event. To understand what this may entail, here are three steps you can take to turn Chrysler into a luxury automaker: rebranding with an exclusive style and bold messages, such as Imported from Detroit, capitalizing on after-sales service sales and partnership with Apple Computer by design.
To see how this fits together, it’s best to consider Chrysler a few years in the future. Imagine that this is the year 2020, 11 years after Fiat acquired most of the company:
To begin with, the Fiat Group focused on rebranding Chrysler. He left Dodge separately as a separate brand, so his sales of cars and light trucks could become a cash cow, as Chrysler was looking for its image.
Although the emerging Chrysler brand was fairly neutral, the advantages of its ties with Daimler were obvious, especially in the design of the 300 series, which looks like a close relative of Bentley.
Given these close ties with high-end automakers, Fiat saw the possibility of stratifying what they called America’s main contribution to the high-performance car market: its own Dodge Viper Chrysler. Chrysler reworked the Viper to create a new sports car that retained the performance of the Viperss, but with indecent luxury features and a revolutionary style. In addition, Chrysler has developed a line of luxury sedans that could compete with the Mercedes S-class and BMW 7-series. To top it all, they reworked their dealerships to appeal to wealthy buyers.
Management also expanded its activities to capture after-sales service. In 2007, car buyers spent more than $ 30 billion a year on an after-sales upgrade. Chrysler redesigned Chrysler parts and services division to include after-sales services in the assembly line and provide customers with more user options.
Finally, Chrysler’s exclusive partnership with Apple Computer offers unsurpassed quality and interior design. Apple has developed an amazing original control panel, user interface and entertainment system with many completely new features in an intuitive format that complements the Chrysler technique.
This is clearly an aggressive project. This will require Chrysler to cut its production line, as well as its revenues. However, with a narrow market segment they could create a much stronger organization. Given the renamed brand, higher margins and global sales, Chrysler can increase revenues to a sustainable level.
By taking on this commitment, Chrysler can restore the charm of an American car and inspire innovation among other US automakers. This tough growth platform and global perspective can draw attention to the Detroit assembly line.
[1] Bloomberg, "German top grasshoppers are set to record profits, as the cost increases by $ 90 billion." Chris Reuters 2-14-2011
[2] "Independent", "Luxury automakers are causing a boom in German exports." Tony Patterson 2-9-2011, p. 38
