FCA's Jeep delay highlights challenges to a potential merger

[hotlap]

DETROIT, June 26 (Reuters) - Fiat Chrysler Automobiles NV's Jeep brand chief said Friday a redesign of its Grand Cherokee sport utility will be delayed by at least a year, intensifying the challenges Chief Executive Sergio Marchionne faces in his quest for a partner.

Jeep brand chief Mike Manley confirmed FCA's decision to push back the launch of a redesigned Grand Cherokee to late 2018 or to 2019 from late 2017. That delay is one of at least a dozen current or new vehicles in North America reported by Reuters.

FCA said the delays are not related to a shortage of money, but dealers could still wait longer for vehicles with fresh designs and technology at a time when rivals plan to launch new models at a faster pace, according to a Bank of America report which noted that the market share gains FCA has targeted "appear unlikely."

FCA's ability to keep up in an intensifying auto technology race is a critical question for potential merger partners, analysts and industry executives said. Marchionne has reached out to General Motors Co CEO Mary Barra, proposing a merger. But Barra rebuffed him, saying earlier this month that GM could do better by "merging with ourselves" to improve economies of scale, respond to tougher fuel economy standards and meet consumer demand for digital connectivity and advanced safety features.

FCA would bring to any merger a U.S. model lineup that ranks last in fuel economy among major automakers, performs poorly in measures of quality, and has a higher than average dependence on consumers who rely on subprime loans, according to non-public data compiled by J.D. Power and reviewed by Reuters.

http://finance.yahoo.com/news/fcas-j...?.tsrc=applewf

[FenwickHockey65]

Marchionne needs to go away.

[motorhead]

So are we looking at chrysler, jeep, dodge, and ram going bye bye?

[ilirg]

Originally Posted by FenwickHockey65

Marchionne needs to go away.

Seriously, that guy is pathetic

[GretchenGotGrowl]

Originally Posted by FenwickHockey65

Marchionne needs to go away.

[hotlap]

Originally Posted by motorhead

So are we looking at chrysler, jeep, dodge, and ram going bye bye?

FCA delaying all the new models two years doesn't look good with GM and Ford updating everything. Add FCA seeking to merge makes you wonder how solid they are.

The last paragraph says a lot too. Inefficient, low quality with sub-prime buyer base. In our segment the Hellcat is cool because of its sheer power but how will it look when the next GT500 and Camaro Z roll out and do everything better?

The whole idea of a merger makes no sense. GM killed Olds and Pontiac. The only thing that would be worth keeping in the US would be Jeep

[DGthe3]

FCA isn't dead, far from it. They are looking to merge with someone now because they are doing fairly well, but they anticipate that they might not be in such a position 5 or 10 years down the road. By trying to merge now it will give them greater negotiating power. That is also the reason why nobody wants to merge with them right now -in a few years the other partner will likely be in a much stronger negotiating position than FCA.

The entire idea of them merging with GM makes no sense. Too much model & market overlap between Chrysler & GM. Of Chryslers 4 brands, odds are only Jeep would be likely to survive it, Fiats brands might remain intact though. A much better choice would be an Asian automaker that wants access to the trucks & SUV's of Chrysler along with the luxury/performance brands of Alfa & Maserati. Hyundai/Kia would fit very well, as might Honda or Nissan-Renault. There are probably even a couple Chinese automakers that could stand to greatly benefit from merging with Chrysler.