More changes for the newly merged Fiat Chrysler.
After nearly 90 years, it’s the end of the road for the familiar Chrysler corporate name.
Just two months after the maker completed its merger with Italy’s Fiat, the U.S. side of the company will abandon the familiar Chrysler Group LLC to become FCA US LLC.
The name is meant to better reflect that of the new parent company, the global Fiat Chrysler Automobiles NV.
“FCA US continues to build upon the solid foundations first established by Walter P. Chrysler in 1925 as well as a rich Fiat heritage that dates from 1899,” the company said in a prepared statement.
Founder Walter P. Chrysler first lent his name to an automobile in January 1924, an affordable 6-cylinder model that went up against such tough competitors as the Model T. The Chrysler name was placed on the corporate masthead a year later, following the reorganization of the earlier Maxwell Motor Co. The company quickly became known for innovations that included the first mass-market use of hydraulic brakes and the first all-transistor car radio.
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In 1998, Chrysler became the lesser half of a so-called “merger of equals” with Germany’s Daimler-Benz. That alliance, the renamed DaimlerChrysler, collapsed in 2007, what was left of the renamed Chrysler LLC was sold to a New York investment fund, Cerberus. But the venture collapsed as the economy entered its worst recession in decades, and two years later Chrysler was forced to file for bankruptcy.
New U.S. President Barack Obama was ready to let Chrysler file until Fiat came along as a white knight. The Italian automaker was given a 20% stake in the reborn Chrysler Group, increasing its holdings until it was able to buy out the remaining stake held by the United Auto Workers Union last January.
In October, Fiat and Chrysler completed their merger, the new, global automaker basing itself out of the Netherlands, with a corporate headquarters in London – and a new listing on the New York Stock Exchange.
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However, for all practical purposes, Fiat Chrysler Automobiles maintains two major hubs – at the old Chrysler headquarters in the Detroit suburb of Auburn Hills, and Fiat’s ancestral home in Turin, Italy.
The Chrysler name will remain part of the parent company’s nomenclature. And it will continue to be used as one of the various brands the maker offers, along with Jeep, Dodge, Ram and various former Fiat names including Alfa Romeo and Maserati.
The Ferrari brand will be spun off next year.
Fiat Chrysler Automobiles operates 36 manufacturing facilities worldwide, with 23 of those in the United States. All told, the company has 77,000 global employees.
As to the impact of the new U.S. name, “Changing the name of Chrysler’s parent automotive group will mean little to the average consumer. Car shoppers are often unaware of these corporate naming structures,” said Karl Brauer, an automotive analyst with Kelly Blue Book. What will matter to the typical buyer, he said, is not the name of the parent company but the quality of the products it is building.
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Consumers will eventually understand that Chrysler is gone when they buy what they thought was a Dodge or Chrysler and find out it’s a Fiat imported from Italy.
Hi, Jorge,
I have to disagree here. If anything, Fiat is largely moving away from Italy – with the exception of Maserati and Alfa and the soon to spin off Ferrari. Look at where the new company’s plants are, and what the products are basing on. If anything, it’s the Chrysler side that really is dominant in critical ways in this, ahem, “marriage of equals.”
Paul E.
The point is that consumers will not be buying Chrysler or Dodge vehicles, they will be buying those badges on Fiat products, which will likely not be made in the USA long term.
They are not FIAT products, Jorge. Auburn Hills is doing the lion’s share of design and engineering. If anything, more of Fiat products will be badged Chrysler models.
Paul E.
Paul – you’re talking about current products. I am talking about a few years down the road. As an example the “new” Dodge Dart is an Alfa chassis with Dodge exterior sheet metal and interior. Soon it will be much more Fiat content and much less Chrysler content.
Fiat’s exclusive reason for buying Chrysler was to sell Fiats in the U.S. which has been unsuccessfully tried at least three times in the past because U.S. consumers rejected inferior Fiat products. If Fiat sticks a Chrysler or Dodge badge on a primarily Fiat based model and consumers are none the wiser, Fiat will sell more of their product until consumers start complaining and stop buying again, regardless of what badge is on the vehicle – just as they did before.
There was another company not too long ago with similar goals by the name of Daimler Ag who previous tried this trick and eventually admitted that it was all a scam to sell Mercedes based vehicles with Chrysler badges. That didn’t work too well for them… LOL
Jorge,
Even the Dart’s architecture underwent significant revisions for the U.S. market, which is why it was renamed US Compact Wide. Fiat’s reasoning for the Chrysler acquisition was not just to sell its products in the US. Marchionne knew that the company didn’t have the economies of scale, nor the breadth of product lines, and couldn’t do it all on its own. It is as much focused on expanding the sale of Chrysler-derived products, notably Chrysler and Jeep brands, abroad, as getting Fiat products into the U.S.
Paul E.
I agree with Paul, at least for the moment. Chrysler/Jeep/Ram is really keeping Fiat from blowing bubbles.