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GM, Chrysler to collaborate on large SUV?

02/15/2007, 2:36 PM

By admin

The Chrysler Group and General Motors are in talks to jointly develop a large SUV like the Chevrolet Suburban — something Chrysler doesn’t have in its current lineup, according to a report by the Wall Street Journal.

Talks have been ongoing over the past six months, the report said. So far, no conclusion has been reached. The deal would save the struggling Chrysler Group a significant investment in developing its own large truck.

“Sometimes we can’t do vehicles affordably so this would be a strategic partnership,” a Chrysler source told the newspaper.

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02/15, 2:38 PM

posted by:

A4

chrysler has the Aspen… good enough

02/15, 2:40 PM

posted by:

04focus

does that mean they’ll get a rebadge of the next-gen suburban?

02/15, 2:42 PM

posted by:

imageWIS

Lets call it the “Chrysler Bottomless Money Pitâ€.

Jon.

02/15, 2:43 PM

posted by:

buenos

Just one question, given the declining sales of large SUVs… Why?

02/15, 2:46 PM

posted by:

jonstew

^^that’s what I was thinking.

02/15, 2:47 PM

posted by:

pherarey

think thing looks like it aims to be the poseidon of suv’s. i just don’t know how much longer the super-size suburbans appeal will remain with these agile, capable, crossovers. athletes, families of 6+ and small companies might look for the landcruisers, but i think like minivans, suv’s might need to shrink away.

02/15, 2:52 PM

posted by:

Cobradreamer427

HOW RETARDED IS THAT!!! Okay, heres the plan, gas was just at an all time high, and likely to go back in the near future, and they want to make a huge SUV that sucks up gas. No wonder their car companies are failing, they’re all idiots

02/15, 2:56 PM

posted by:

Bobzooki

GM needs ****ty Chrysler like a hole in the head and neither company needs a large SUV, this is such a retarded idea

02/15, 3:00 PM

posted by:

Fatstrat

Think clearly people.
There will ALWAYS be customers for large vehicles/SUV’s.
It doesnt matter if gas reaches $20 a gallon, someone will buy them. Just because the cost rises does not make the need go away. SUV sales may be dropping, but they are dropping from record highs. That means probably less selection, but not the elimination of the class.
As far as the joint effort goes, well I just dont know about that.

02/15, 3:05 PM

posted by:

gotsmart

WTF is “strategic” about this move?

02/15, 3:06 PM

posted by:

buenos

Agreed Fastrat, but you have to question the wisdom of introducing another player into a declining segment.

02/15, 3:09 PM

posted by:

Brendino

So what does GM get out of the deal?

02/15, 3:13 PM

posted by:

bb_454

Think clearly people.
There will ALWAYS be customers for large vehicles/SUV’s.
It doesnt matter if gas reaches $20 a gallon, someone will buy them.
Comment by Fatstrat, posted on February15 at 3:00 pm

At $20.00 a gallon the few amount of people that would actually buy it they wouldn’t ever recover the cost to design, engineer, build and market the thing. That would be a huge waste of money IMO. But just yesterday didn’t Chrysler release a report outlining their recovery strategy saying something along the lines of reducing funding and development of trucks and focusing more on cars? Collaborate on making a car, or a CUV, but large SUV’s are taking a hit in the market today. Poor decision making, this isn’t something they need in their lineup.

02/15, 3:13 PM

posted by:

wetstuff

Maybe they think gas is going back to $1.25gal. Jezuz – cut Mopar loose before they pull the Germans into the toilet with them.

02/15, 3:19 PM

posted by:

Z06ified

People are blowing the cost of fuel to run large SUV’s out of proportion. It’ll cost the average family $2,250 a year in fuel costs to keep a new Suburban fed for 12,000 miles per year getting 12 MPG average. If they drove a Prius getting 45 MPG, it would cost them $600 a year. Does the extra $1,650 per year in fuel cost really matter to a family that can afford to buy a $45k vehicle in the first place?

Driving a crossover SUV, the difference is even less significant, as most crossovers won’t do better than 20 MPG average. Plus, no crossover is as capable as a Suburban.

I think what you’ll find is the higher fuel prices will flush out the non-traditional Suburban buyers (buyers who don’t need the vehicle to be that big, but buy it for image or insecurity compensation reasons). In other words, the upper middle class soccer mom with 2 kids who didn’t want to drive a minivan, and bought a Suburban instead, will trade in her Suburban for a smaller crossover. But there is certainly a market for Suburbans for those who need the vehicles capacity and capability. There has been a market for them since the Suburban first came out in 1935. The Suburban is the longest running model in continuous production in the world. It wouldn’t have that distinction if there were no market for it, or if it depended on styling fads and cheap gas to sell.

Will the Suburban sell as well as it did in the big SUV boom of the late 1990’s? No. Is the Suburban and other large SUV’s doomed to become extinct? Not even close.

02/15, 3:35 PM

posted by:

Stuart

Not a bad idea from Chrysler Perpective. If next time round production falls they don’t have to worry about the workers, cut backs and so on as its not their factory it will be built at. SMART MOVE ON CHRYSLER BEHALF.

Guess for GM they can run the factories at full capacity without overlapping models.

02/15, 3:38 PM

posted by:

bb_454

Z06, I didn’t say the burban was doomed, but SUV’s are slowing down in sales, pick ups are slowing down, but CUV’s are whats hot, at least from everything I read. I think with focus shifting to cleaner and greener, vehicles like the Suburban are going to lose sales, I don’t see the large SUV market being as profitable as some other markets. And your right, a CUV isn’t as capable as a Suburban in most cases, but most people don’t ever use a vehicle to its potential anyway. As long as its able to cruise through some snow and maybe pull a boat with room for some kids that about all most people need.

02/15, 3:41 PM

posted by:

golf4me

That’d be like a classic “dumb and dumber” matchup!!

Frankly, I don’t thing GM would be up for this unless they already had a stake in Chrysler, or owned it outright, which people are speculating. However, GM has enough on it’s plate, and I don’t think they’ll want to take on Chrysler’s legacy costs even if it means they can “buy” their competition for a song. They already have better trucks than Chrysler, and much better cars (especially with the advent of the Zeta, which is better than the 300/Magnum), the Malibu is 100x better than the Sebring, and so on…so what would they have to gain? Nothing, except for more problems.

02/15, 3:42 PM

posted by:

Blakkarr

If Chrysler wanted a full-sized SUV they could have made one by now. the Aspen/Durango has carved a neat hole for itself and I don’t see DCX needing anything larger.

Besides, If there really was room for another “super-sized” SUV like the Suburban then the Excursion would not have been dropped… and don’t go off with the “Well the Excursion sucked” crap. Tell that to all the people in Texas that bought one and still swear by it.

This Is a bad Idea… Unless they are trying to build some Suburban-sized crossover like the Lambdas Arcadia, Outlook, and Enclave. Then I’d say, see what you can do. Otherwise, this is just another restroom rumor and should be ignored.

02/15, 3:53 PM

posted by:

bb_454

Besides, If there really was room for another “super-sized” SUV like the Suburban then the Excursion would not have been dropped

Thats exactly what I was thinking, but I forgot to mention it.

02/15, 3:53 PM

posted by:

NOS2006

homeboy, you obviously haven’t driven or seen any of GM’s new or upcoming models, have you? You should go test drive a new Lambda crossover, new Malibu/G8/Camaro/CTS (when available), Aura, or GMT900. I have a feeling you might be surprised.

02/15, 3:54 PM

posted by:

Z06ified

“I think with focus shifting to cleaner and greener, vehicles like the Suburban are going to lose sales, I don’t see the large SUV market being as profitable as some other markets.
Comment by bb_454, posted on February15 at 3:38 pm ”

I don’t think any manufacturers of large SUV’s see the segment as a growing market any longer, but that doesn’t mean it isn’t a highly profitable market, or an important market. In it’s heyday in the late 1990’s, Suburbans were generating $10,000 in net profit per vehicle. Considering the platform and substantial parts sharing with the full size pickups these vehicles are based on, development costs are relatively low, and incremental tooling and production costs to build a Suburban or Expedition versus a pickup are minimal. Translation: plenty of profits to be made, even in a declining sales environment. I doubt GM is still earning $10,000 for each Suburban sold anymore, but I’m willing to bet it is still one of the most profitable models they have.

I’m not sure why Chrysler never saw the opportunity to spin off full size SUV’s from it’s Ram pickup platform like Ford and GM have, but it didn’t, and they always had a hole in their SUV product lineup. They finally realized there’s money to be made in this segment, even if it is currently shrinking in volume. Selling 30,000 full size SUV’s at a net profit of $1,000 per vehicle is better than not selling any at all, for example, even if that volume may be 25,000 next year.

02/15, 4:00 PM

posted by:

Z06ified

>>Besides, If there really was room for another “super-sized” SUV like the Suburban then the Excursion would not have been dropped”

Ah, but the Excursion was just replaced with an extended length Expedition. The Excursion was too big, and way too truck-like for most people. The mistake Ford made was basing the Excursion on their Super-Duty pickup platform. They should have just done what they are doing now: offer the Expedition based on the F-150, in two lengths: short wheelbase, and long wheelbase, just like the Tahoe and Suburban.

The extended length Expedition will sell much better than the Excursion ever did. The only smart thing Ford did with the Excursion was offer a diesel with it. If they didn’t do that, it would have barely sold at all.

02/15, 4:01 PM

posted by:

Piablo

Didn’t I read previously that Daimler was considering a new brand split from Chrysler? This may be playing a part in it.

Otherwise, as ^Blakkarr stated, this sounds like someone leaking information without the full details. “Sometimes we can’t do vehicles affordably…” By the grammar, it sounds like they interviewed the vending machine guy.

02/15, 4:15 PM

posted by:

Fatstrat

Models will go away. Manufacturers need to project and begin developing those replacements now. Cant develope a new vehicle over night, but sometimes an existing model can tank in that amount of time. Lead time…
Example, if there are 40 suv’s on the market today (total hypothetical number) then by the time this could be ready for retail there might only be 25 or 30. On the other hand there might also be 45. There is risk involved too.

02/15, 4:50 PM

posted by:

lotusfire

I agree with Z06isfied. bb_454, if Chrysler is trying to narrow done their line and cut costs as well as shift more towards cars than trucks, then this is exactly what they shuld do IMHO. I’m sure they want a complete line-up, and they don’t want to spend extra time and money on new models they shouldn’t be focusing on. What should they do? I think a merger is a great idea. What’s in it for GM? Who knows. But this is just a rumor so who knows what the real story is.

02/15, 4:55 PM

posted by:

Egbert Souse

“Just one question, given the declining sales of large SUVs… Why?”
Comment by buenos, posted on February15 at 2:43

Exactly..

DCX WHY??

02/15, 5:10 PM

posted by:

bb_454

I just disagree. I see the large suv market declining, and given Chrysler’s financial state they need to focus on whats hot or up and coming. I see the Durango as being good enough for the large suv market. Why waste resources on something thats fading. But I guess if your going to enter into a fading market its better to distribute the cost of development over as many parties as possible.

02/15, 5:16 PM

posted by:

maximus

looks sleepy…

02/15, 5:22 PM

posted by:

lotusfire

@ bb_454

I see what you’re saying now, and I agree. Still, there’s also the possiblity that–since these are just talks after all–this is planning for way in the future. I do think they’ll want a complete line-up eventually.

02/15, 6:08 PM

posted by:

chris2

Large SUV’s dieing?

GM sold over 353,000 in 2006, a year with huge gas increases and everyone scared for the future. In ‘05 they sold 365,000. (not counting Hummer or Cadillac) Not exactly a huge drop in sales. Yes, large SUV’s peaked but there is still a huge market and with gas at close to $2 sales will stay steady or drop only slightly.

02/15, 6:31 PM

posted by:

NOS2006

bb_454: the Durango is not good for anything. I’ve got first-hand experience being that my parents own one. It has soft ass brakes, weak power (the 4.7 at least), a terrible transmission (you can count seconds between shifts), terrible(!!!) suspension (never been so scared to drive the expressway at 70 in my life, especially around slight bends), and some of the cheapest interior pieces I’ve ever seen (both design and texture). To top it all off it’s overpriced, terrible on gas, and made my parents never want to buy a DCX vehicle again (this is their third ****ty DCX vehicle out of five — three Durangos and two Caravans — and each one they get is worse than the previous.. oh, and this is coming from my mom, too, whose parents both retired from Chrysler).

02/15, 6:34 PM

posted by:

chevy490

kool my 2 fav companys working together!

02/15, 6:59 PM

posted by:

Elvio

That means Chrysler has no idea what the large SUV lovers want. Well…I think it, the Chrysler, dosen’t know what they are doing actually. Look at their line up…so disturbing to watch.

02/15, 7:32 PM

posted by:

angelo

Since this segment is becoming smaller (however, it’s still considerable in the American south and midwest) it is very practical to co-develop these types of product across brands. This reduces risk and improves the bang for your R&D buck.

02/15, 9:00 PM

posted by:

ChuckDePatty

The new Gm suvs are the best in the full size market. So Chrysler would get the best in the market right now for minimal costs, not stupid at all. I would call it stupid if they decided to design and engineer their own.

02/15, 10:03 PM

posted by:

Hyperion

We don’t need this vehicle. At the very least, Chrysler could make a real competitor to the Land Rover Discovery, original H1 Hummer or the last generation of Toyota Land Cruisers.

They could be spending money on the 300, Dodge Magnum and Charger in order to refine and improve upon the designs. Instead, they wnat to build another land yacht.

02/15, 10:39 PM

posted by:

TomF

I thought too much focus on big SUVs and trucks was what’s sinking Chrysler in the first place. WTF?

02/15, 11:55 PM

posted by:

Egbert Souse

I hate to offend Chevy enthusiasts but I think their logo sucks, Its big, fat, and gold, its just an eyesore. I want to like Chevy’s but nothing kills me more than that logo. And while I’m at it, Dodge get rid of the cross grille thing, its old and ugly.

02/16, 1:03 AM

posted by:

europerspective

what’s in this for Chevvy, the Suburban is big and simple, doesn’t need a lot of development costs, its just a bigger Tahoe. Can’t see this making much sense in terms of this model alone, but when you bear in mind that Daimler-Chrysler are considering dumping Chrysler there might be something more strategic going on..

02/16, 6:52 AM

posted by:

Stuart

Even if GM wanted to buy Chrysler they couldn’t afford it anyway. Isn’t daimlerchrysler worth four times what GM is worth in the first place.

Either way this has got to be a romour seeing as the best full size SUV is the Mercedes GL and seeing how they are going to share platform between chrysler and Mercedes, then chrysler should be getting that platform anyway. Just imagine a jeep commander built on a Mercedes GL platform. Even the H1 won’t be able to compete

02/16, 3:17 PM

posted by:

Kyle

Large SUV? I thought Chrysler was going to focus on smaller suv’s due to their terrible sales

02/16, 7:26 PM

posted by:

meekin111

Stuart, Daimlerchrysler bay be way way way beyond GMs price range but the american chrysler group isnt worth a pinch of ****

02/18, 7:35 PM

posted by:

wow

Allow me to humbly suggest a name for this undoubtedly re-badged suburban:

The Chrysler Titanic.

02/21, 1:39 PM

posted by:

CorvetteMann

I just hope the collaboration between the two doesn’t let the Chrysler’s influences ruin Gm’s quality of trucks.

 
 
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