Chrysler simplifies product range

A plan is being discussed for Chrysler dealers to sell all the car maker's passenger vehicles under the Chrysler name.

Dodge dealers would exclusively offer pickup and commercial trucks, while Jeep dealers would sell Jeep and sports utility vehicles, according to three dealers familiar with the discussions.

Such a scenario would enable Chrysler to drop some of its overlapping products, which essentially compete with one another, such as the Dodge Avenger and Chrysler Sebring — both mid-size sedans but marketed under different names.

Fewer products could mean a reduction in dealers, which would weed out poorly performing dealerships that have excess inventory and resort to incentives that hurt profitability.

“This is one of the plans they are studying,” said a dealer who was informed of the idea. “At the end of this year, they expect to have a plan for the future.”

Chrysler co-president Jim Press, speaking at a media briefing last month, suggested the car maker simplify its line-up.

Mr Press, who until September was president of Toyota Motor's North American operations, questioned the need to divide Chrysler's resources to market both a Chrysler Town and Country minivan and a Dodge Caravan.

Mr Press spent 37 years with Toyota, which in comparison has fewer, and more profitable, dealerships in the US.

Chrysler spokesman Rick Deneau said: “I would not interpret Jim Press's comments about product overlap as an indication we will segregate vehicle types by brand.”

The broad scope of the plan underscores how fast and deep Cerberus Capital Management is willing to go to turn around Chrysler after buying an 80.1 per cent stake in August.

Chrysler, which is facing sluggish US sales because of housing market weakness and high fuel prices, this month announced an expansion of a restructuring plan unveiled in February, saying it would cut its North American hourly workforce almost in half by 2010.

Chrysler has made several high-profile executive appointments since Cerberus took over.

Its executives have decided to kill the entire PT Cruiser line after the 2009 model year, according to a dealer who was told of the decision in the past week. The move is part of the car maker's push to eliminate slow-selling models.