AUBURN HILLS -- Local Chrysler dealers welcomed the company's plans to revamp its struggling Dodge car brand under its new turnaround plan.
Under the plan unveiled Wednesday, the automaker aims to introduce four new Dodges by 2013 and put new exteriors, interiors and engines on most of its current lineup. The new Dodges include a mid-size sedan for the North American market designed by Fiat SpA, the Italian automaker that now owns 35 percent of Chrysler.
That sedan is a key component of Chrysler LLC's five-year overhaul. Chrysler currently lacks a competitive product in the segment, the largest in the U.S. car market.
Jamie Marsh of Marsh Automotive Group in Traverse City, which includes the Chrysler, brand said he was encouraged by the company's plans. While Chrysler is a popular brand for consumers looking for minivans, Jeep products and its Dodge truck line, it's not done well in the sedan sector, he said.
"The problem with Chrysler is they just are not competitive in the mid-sized car market," Marsh said. "Nationally it's huge, and Chrysler has not been a player in that at all."
Chrysler's current mid-size offerings are the Sebring and Dodge Avenger, which sell poorly and have received low marks from Consumer Reports and others.
Sebring sales were down 71 percent during the first 10 months of this year, while Avenger sales were off 45 percent. The Auburn Hills-based company has sold only 44,000 of both models combined, far short of the 294,493 Camrys sold by Toyota, the top-selling car in the U.S.
Another key to Chrysler's revival is whether it can tackle quality problems. Doug Betts, senior vice president of quality, said that work is under way.
He said the company has been restructured so the 14 teams focusing on specific areas act quickly to resolve problems.
When he arrived late in 2007, it took 71 days for someone to begin working on a problem, so the Chrysler's ability to raise its quality fell behind rivals.
"Seventy-one days goes to zero days," Betts said.
Fiat has plans to replace most of Chrysler's engines with its own. Paolo Ferrero, senior vice president of powertrain, said the number of Chrysler-designed engines will drop to 12 percent by 2014 from 84 percent currently, with many larger engines replaced by smaller, four-cylinder ones.
Dirk Watson, owner of Watson's Manistee Chrysler in Manistee, said Wednesday he was still sorting through the company's announcement but is encouraged by what he's seen so far.
"What I've seen as far as their product plans, I'm excited," Watson said. "I haven't seen anything in there that's negative."
Marsh said the company's turnaround plans were "a long time coming" and that dealers were largely in the dark about the details.
"Ever since the bankruptcy they've kind of gone into hiding, even with the dealers," Marsh said. "We've seen very little information."
The 84-year-old Chrysler lost upward of $8 billion last year and would have run out of cash had the U.S. government not stepped in with $15.5 billion in aid. Chrysler was forced into bankruptcy protection earlier this year.
Chrysler CEO Sergio Marchionne said Wednesday the automaker's cash has grown by $1.7 billion since it exited Chapter 11 this summer and totaled $5.7 billion at the end of September. He also said Chrysler was breaking even in that month.
Marsh also said that's also a positive sign for the company's long-term fortunes.
"It's good to see their cash is growing," Marsh said. "Ultimately, that's going to determine whether they survive as a company or not."
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