GM and Chrysler Revving Up Efforts in Europe

[mgescuro]

Well, I posted this last nite, but because of the site problems, it's not longer posted... so I"m reposting it.

You will need a paid subscription to the Wall Street Journal Online to view teh full article.

http://online.wsj.com/article/0,,SB1...cle-outset-box

GM and Chrysler Are Revving Up Efforts in Europe
By NEAL E. BOUDETTE
Staff Reporter of THE WALL STREET JOURNAL



GENEVA -- The Chrysler Group and General Motors Corp.'s Cadillac division are gearing up separate efforts to win market share in Europe by expanding sales of their American brands.

At the Geneva auto show today, the U.S. arm of DaimlerChrysler AG will unveil a compact five-door car that, with minor modifications, will be launched as the Dodge Caliber in 2006. The vehicle, which looks a bit like a station wagon, will arrive first in the U.S and then lead a reintroduction of the Dodge brand in Europe after a hiatus of some 20 years.


Dodge will show its Caliber concept at the Geneva auto show


Chrysler also is showing the 300C Touring, a station-wagon version of its hot-selling sedan, that will be sold only in Europe. The vehicles are part of a bid by Chrysler to roughly double the number of cars it sells in Europe to around 160,000 within a few years.

Cadillac will use the Geneva show to present a prototype of a compact sedan that it plans to sell next year in Europe, but not in the U.S. Cadillac is counting on the car, called the BLS, to lift its yearly European sales from less than 2,000 cars in 2004 to 20,000 by 2010.


Dodge's 300C Touring


The move comes as GM continues to look for ways to shore up its unprofitable European operations, which are contributing to GM's declining profitability overall and adding to fears of a downgrade of its credit-worthiness. DaimlerChysler, meanwhile, is hoping some of the improvement in its U.S. Chrysler operations will carry over to Europe, the world's second largest car market. DaimlerChrysler needs to keep Chrysler growing since its core Mercedes brand has suffered recently from tough competition and consumer concerns about quality.


GM will show a line of low-cost cars it plans to sell as Chevrolets in Europe


The efforts reflect the competitive pressures the Chrysler and Cadillac brands continue to face, despite their recent resurgence in the U.S. market. Analysts believe Chrysler is losing money on the Jeeps and minivans it sells in Europe. GM, meanwhile, is convinced Cadillac needs to build a presence in Europe if it is ever going to offer the kind of cachet that luxury-car buyers see in BMW and Mercedes. "Europe is very much a bellwether market. It defines luxury, and success in Europe is critical," said Jim Vurpillat, Cadillac's director of international marketing.

In Geneva, GM will also show a line of small, no-frills cars that it will sell in Europe as Chevrolets. The cars, some of which sell for as little as €9,000, or about $12,000, are made by GM's Korean partner, Daewoo.

GM hopes the line of low-cost Chevrolets will ease some of the price pressure on Opel, its main European brand, which has been unprofitable five years in a row. Opel has lost market share while battling Japanese and Korean car makers offering lower prices. Last week, Opel reached an agreement to shed 4,500 workers, paying each an average of about €100,000 to leave the company. GM hopes an additional 1,500 will leave its European payroll through attrition or early retirement.

The Cadillac BLS that will be unveiled in Geneva is supposed to use up some of GM's excess production capacity in Europe. The midsize, front-wheel-drive sedan will be built in a Sweden plant run by GM's Saab unit.

Chrysler is taking a different tack, betting it can sell essentially the same car to U.S. and European drivers, something few mass-market car makers have done successfully. Both GM and Ford Motor Co. have different product lines for North America and Europe."We believe there is untapped potential for Chrysler brands in Europe," Chrysler Chief Executive Dieter Zetsche said in a recent interview.

[spudglo08]

I still think they should bring the BLS here.GM could lose some sales here withe the absence of an FWD Caddy.

[Kar Krazie]

I think GM North America needs effort. They are doing good so far but is all the attention going to go to Europe and not North America?

[mgescuro]

Originally Posted by spudglo08

I still think they should bring the BLS here.GM could lose some sales here withe the absence of an FWD Caddy.

Not yet. I think there will be a time and place for the BLS, but that will necessitate a change in teh price structure of the Cadillacs... liek this one...

BLS at $25-35K
BRX at $28-38K
CTS at $31-51K
SRX at $35-52K
DTS at $46-52K
STS at $41-70K
XLR at $76-86K
ULS at $85-115K

The thing is, I don't know if Cadillac really needs to be in the B-series range in teh US. But... if the need for sales arises (maybe to the cancellation of DTS down the road), then I can see a potential shuffling of the cars and feature sets to make the B-series work.

[x2222]

As much as i really like the BLS and think its a well done, great design, i know that they should not bring it to the U.S. Buick may need something like that but definetly not cadillac. They need to push even further up market, not down.

[chrisbenz]

Lexus IS starts at $30,280 and ES starts at $32,825 and thy sell well.ES is bigger and FWD and IS is RWD.But I now Buick is trying to be an American Lexus.Thy should let them an American Toyota/Lexus and give Cadillac the BLS.

[AndrewGS]

I think we should send a few more US cars over there. Putting Ameican names on Korean and European cars isn't they way to go, send them something a little different than the little well-built econoboxes that all the European compnies already build.

[AmericanRevolution]

Seeing the profile view of thje Caliber concept, it looks like SOMEONE copied the Matrix/Vibe siblings...