So Fiat is riding to Chrysler's rescue with small, fuel-efficient European vehicles, right?
Four of the six new vehicles from Fiat will enter the small-car segment, which Chrysler had abandoned. That crowded segment covers only 14 percent of the entire U.S. light-vehicle market.
The two other vehicles simply will replace current Chrysler vehicles.
So in the coming years, the bulk of Chrysler's revenue still must come from current big-volume mainstays such as the Dodge Ram pickup and Dodge Grand Caravan minivan.
Chrysler will need billions of dollars to keep them fresh — a major challenge for a broke company fighting to emerge from Chapter 11 bankruptcy protection with government loans and a very limited new-product pipeline.
Here's the rub for Chrysler: If fuel prices rise above $4 a gallon again, the small-car segment could grow quickly, and Fiats could boost volume, revenue and perhaps margins. But high fuel prices would hurt sales of Chrysler's traditional strength: light trucks.
Market analyst Tracy Handler of IHS Global Insight said U.S. small-car sales "are pretty small volumes" but could grow by 2011 when the first North American Fiat designs are built.
"The volumes need to be big for Chrysler to survive," she said. "Will they be? I have doubts about that."