Fiat asks Chrysler to boost Freemont output
TURIN - Fiat S.p.A. has asked Chrysler Group to increase production of the Freemont large minivan after better-than-expected European sales of the rebadged Dodge Journey.
At its June introduction in Italy, Fiat said it planned to sell 13,000 Freemonts this year, but the automaker told Automotive News Europe on Tuesday it already had collected 15,700 orders.
Fiat planned to sell 33,000 Freemonts in 2012, the first full year of sales in Europe. As a result, Fiat was promised 3,000 Freemonts a month from Chrysler's plant in Toluca, Mexico. To meet the higher-than-planned European demand, Chrysler boosted Freemont production by more than a third to 4,067 units in June by working overtime.
Chrysler is looking for ways to get Fiat 4,000 Freemonts every month without the added cost of overtime, Fiat said. Unlike the U.S. version of the minivan, the European version has a different front and rear styling, its handling and suspension settings have been tweaked, and it is powered by Fiat's MultiJet 2 diesel engine, not offered by Dodge.
More dealers, aggressive pricing
One reason why the Freemont is selling so well is because Fiat has a larger dealer network than Chrysler did when it was operating independently in Europe. The Journey's sales in Europe peaked at 8,318 units in 2009 before declining 23.4 percent to 6,375 units last year, according to market researcher JATO Dynamics.
Fiat, which owns 52 percent of Chrysler, took over European distribution for the U.S.'s third-largest automaker last September. The change means that Chrysler Group products, regardless of whether they are badged as a Fiat or Lancia, have greater exposure than ever in Europe because Fiat brand alone has 1,500 dealers in Europe.
Fiat also has won customers for the Freemont by being aggressive with its pricing. The minivan starts at 24,900 euros in Italy. That's 5,600 euros - or 18 percent - below the starting price of the slow-selling Fiat Ulysse that the Freemont replaces.
Fiat said 80 percent of orders for the Freemont have been placed in Italy and 80 percent of the customers were new to Fiat.
For years, Fiat struggled to compete in the large minivan segment. Even in Italy, Fiat minivans have been outsold on a regular basis by the Chrysler Grand Voyager and Renault Espace. The Freemont is the first in a series of rebadged vehicles planned by the Fiat-Chrysler alliance.
In November, Lancia will begin distributing the Chrysler 300 large sedan in Europe as the Thema, while the Grand Voyager large minivan will become the Voyager when it joins the Lancia lineup.
Each Chrysler-made car will keep it original badge when sales start later this year in UK and Ireland, where the Lancia brand is not distributed.
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