Chrysler: Strength and weakness? - MG-Rover.org Forums

 
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post #1 of 12 (permalink) Old 21-03-2007, 20:20 Thread Starter
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Chrysler: Strength and weakness?

I have an exam tomorrow which has a very high chance of conducting a SWOT analysis (Strength, Weakness, Oppotunities and Threats) on an American car manufacturer.

I can think of the negative bits like weakness and threats, but I can't really think of Chrysler's (including Dodge and Jeep) strong points at the moment.

Can anyone think of something to add to the list?

Strength:
Established brandnames
V8 Hemi engine, itself a good selling point
Good reviews on the Chrysler 300C

Weakness:
Too reliant on light van and trucks
Not the most fuel efficient
Not "lean" enough in production
Paying a fortune in health care costs and other benefits that makes them uncompetitive with other automakers
Lack of products in the small car market dampens sell prospect outside US
Overcapacity, too many staffs

Oppotunies:
Weak Dollar aids exporting profit margin
Warm preception to its concept cars: Dodge Challenger, Dodge Charger
Joint hybrid development with BMW and GM

Threat:
Growing presence of Toyota and other Asian big players
Rising oil prices
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post #2 of 12 (permalink) Old 21-03-2007, 20:48
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As the price of gas has gone up, the V8 Hemi has been highlighted as a negative in some of the US press I've read recently on Chrysler.
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post #3 of 12 (permalink) Old 21-03-2007, 20:52
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Toyota's been a threat for 30 years! The problem is that the Japanese have now gone for the pickup market big time were the US manufacturers had retreated and the double whammy is the oilprices and growing backlash against excessive bulk,
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post #4 of 12 (permalink) Old 21-03-2007, 21:34 Thread Starter
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Toyota's been a threat for 30 years! The problem is that the Japanese have now gone for the pickup market big time were the US manufacturers had retreated and the double whammy is the oilprices and growing backlash against excessive bulk,
What comes after "against excessive bulk," ?
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post #5 of 12 (permalink) Old 21-03-2007, 22:08
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I don't see how the Hemi is really hurting Chrysler. The engines are actually more fuel efficient than almost all other V8s on the market (and some V6s) thanks to the MDS, which could actually give Chrysler's 8-cylinder products an advantage over competitors in a time of high fuel prices.

At any rate, a buyer shift away from V8s would tend to affect all manufacturers equally, and Chrysler is insulated somewhat in that all their passenger cars offer V8s only as an option, with 4 and 6 cylinder units as standard. The big hit comes in the profitability of the Hemi, as its a very low tech engine manufactured in a low-cost Mexican factory, yet it sells at a price premium, making it more profitable than Chrysler's other engines.

Chrysler has probably the strongest passenger car line of the Big Three, but the company is even more reliant on light trucks than Ford or GM. This is mainly a side effect of Jeep- 1/3 of Chrysler's brands is used exclusively on SUVs and 4X4s. With light trucks consuming so much of its business, no matter how good its passenger cars may be (and they seem to have peaked with the 300), there's no way they could ever compensate for a major drop in truck sales.
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post #6 of 12 (permalink) Old 22-03-2007, 00:36 Thread Starter
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Cheers, Bob. I appreciate your post very much.
I actually forgot about the MDS technology on the Hemi.

How low-tech is the Hemi actually?
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post #7 of 12 (permalink) Old 22-03-2007, 01:21
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Allright, so maybe the oft-repeated "low tech" label is a bit unfair. A better choice of words would be that the use of pushrods instead of overhead cams reduces manufacturing costs at the expense of some sophistication. Other than that, it really is a very modern engine, and in the 300C/Magnum/Charger, it can achieve up to 25m/usg; which really isn't bad at all for a car in that class.

(Of course, GM's old smallblock V8, with the same 5.7L displacement, was rated at 26mpg when installed in the B and D body cars without any cylinder deactivation system, but that's a moot point as that engine is no longer available on factory cars).


EDIT: This Wards Auto World article, though from 2005, still has some useful figures regarding Hemi sales and profitability.
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post #8 of 12 (permalink) Old 22-03-2007, 07:58
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What comes after "against excessive bulk," ?
Oh gawd it's the English punctuation police. Fair cop guv I forgot a full stop. I'll do my penance in pendant's corner.
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post #9 of 12 (permalink) Old 25-03-2007, 16:42
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The problem with Chrysler is that they really only produce cars for the American market. All the other major manufacturers design cars for specific markets and tastes. In particular the major markets are Asia, Europe and North America.

To succeed Chrysler need to build cars for markets outside the US. The problem is that they lost their European base when they sold out to Peugeot in the late 1970's to stave off bankruptcy in a tough car market at the time. The problem is that the current market is a lot tougher at the moment and they quite simply don't have the ability to design cars for anything but the American market.

The only car manufacturer in the world that has managed to sell virtually identical models across the world is BMW, and the telling thing is that BMW are essentially a Premium Marque (even though a number of us in the UK would probably now disagree as the cars are a common sight on UK roads).

Therefore the choice for Chrysler is stark, either go upmarket and sell only Premium cars that are likely to make money and risk loosing market share in the US, or partner with a Far Eastern or European that can provide the necessary technical expertise to build the smaller cars to a standard that can compete with the competition. Note that GM are now selling the European Vauxhall/Opel Astra under the Saturn marque.

There is a direct similarity between Chrysler and MG Rover. Both car companies have a long history and at one stage were major world players. They also have in recent years produced cars that (in my opinion) looked a million dollars (the 300C and the 75). Makes you wonder how long it will be before we get a Roewe 3000.
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post #10 of 12 (permalink) Old 25-03-2007, 18:48
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andy, how did the exam go?
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post #11 of 12 (permalink) Old 25-03-2007, 19:22 Thread Starter
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andy, how did the exam go?
Thanks for asking.
It was okay. I don't think I wrote enough on the other questions though, and from what I heard, that lecturer is rather mean at giving marks. Hopefully it will turn out fine.
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post #12 of 12 (permalink) Old 26-03-2007, 21:05
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Originally Posted by xerif View Post
Oh gawd it's the English punctuation police. Fair cop guv I forgot a full stop. I'll do my penance in pendant's corner.
Hate to be pedantic (or pendantic!), but don't you mean pedant?!
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