Fiat Chrysler has decided to take a big gamble, one that could result in embarrassing failure or a brighter future. Most people know FCA is best at making Jeeps, trucks, SUVs and muscle cars and not much else. That’s why it will be ceasing production of its small and midsize sedans.
In other words, say goodbye to the Dodge Dart and Chrysler 200, at least as you know them now. FCA will stop making both vehicles by 2018, clearing the way for a new era.
Another automaker, likely one that FCA has worked with in the past, will be tapped to produce the future Dart and 200. Speculation about which one is all over the place right now, but Mazda, Hyundai, VW and even Mitsubishi are possible candidates.
Any of those options would help turn the company’s financial situation around, even if it’s not for the reasons most people are considering. The 200 and Dart are financial drains on FCA, thanks to slow sales and slim profit margins. Where the company really pays the bills is selling Jeeps, Rams and the like. By concentrating on its strengths, FCA sets itself up for a potentially brighter future, if the gamble pays off.
It’s no secret that Sergio Marchionne, FCA’s CEO, is looking for another automaker to buddy up with, as we’ve reported before. Instead of just coming on hot and heavy like it did with GM, FCA is taking a new approach by making itself more financially attractive.
What happens next depends on if and how this move pays off. FCA could become a nice partner for another automaker, similar to how Nissan and Renault have become buddies. If, for example, FCA and Mazda were to get together, the two could help each other flesh out the blind spots in their product lineups.
The other option is that another company could come in and take over FCA by force. Again, likely candidates would be automakers that have sparse truck and SUV lineups for the North American market, giving them an instant foothold in those segments. Either way, be prepared to see a big transformation for FCA.