Fiat Chrysler Merger Is Upon Us: Which Brands Live Or Die?
With the approval by shareholders today of the joining of Fiat Chrysler and Groupe PSA, the merger is upon us. The nuts and bolts of the union should be wrapped up before spring. But with it comes the fact that there are now too many brands in what will be called Stellantis. That means the stronger ones survive and the weak ones will be cut. Here’s MotorBiscuit’s bet on which brands live and which ones die.
While Peugeot has no footprint in the US it will be the second most-selling brand in Stellantis behind leader Jeep. Peugeot will be followed closely by Fiat, though in the US Fiat is seeing ever-decreasing numbers. But both Dodge and Chrysler-especially Chrysler, don’t have a bright future as ongoing brands.
While Dodge is doing well with its aging performance sedans, emissions regulations look to kill the performance party. Especially under a Biden administration looking to ramp up emissions standards. But let’s be honest, Fiat Chrysler has spent little in the way of significant improvements for Dodge products. Instead, it keeps sales lit with ever-increasing horsepower ratings.
Chrysler has seen its portfolio drastically cut over the last few years. Now it is down to an aging 300 sedan and a minivan. That’s tough to build upon when there are so many new models already being produced by Peugeot, Opel, and Citroen.
Though sales were down almost 25% last year it is still the powerhouse that drives this merger. That, and Ram trucks. Jeep sold over 860,000 vehicles last year. And it is a far more profitable lineup than anything else Stellantis will have. As Jeep expanded into the European markets it saw sales explode to 1.55 million units in 2018.
Now with even a better distribution system, it should finish developing its entry-level Jeep that slots in behind the Renegade. Using the PSA’s CMP platform it will debut in 2022. By the middle of this year, the new Grand Wagoneer and Wagoneer will increase both China and US sales. Jeep continues to be on a roll.
After Volkswagen and Renault, Peugeot is the number three best-selling brand in Europe. It needs to either launch in the US or be rebadged here. Would it be easier and safer to just call it a Dodge? Still, with its popularity in Europe, it should translate well here. Both Dongfeng Motor in China and the French government own a combined 14% of Peugeot. Whether that is of consequence in the US remains to be seen.
Fiat throughout the world has seen very uneven sales according to Automotive News. Stellantis may try to increase models within the brand or completely reposition it. But it needs an infusion of something as it has now abandoned China and sales here in the US are dismal.
It’s safe to say that Ram will only prosper with sales of over 525,000 and the prospect of new commercial vehicles morphed from Peugeot. It is the “profit center” of Fiat Chrysler and is the other bright star for Stellantis behind Jeep.
With sales of over 500,000, Citroen will continue within Stellantis as it broadens its portfolio. With two new crossovers and a C4 EV, it is positioned right where Stellantis wants it. Now, if it can just resonate in the US.
Sliced from General Motors in 2017 after decades of losses, it has quickly bounced back to profitability under the Groupe PSA banner. It just released two small cars; the Corsa and Mokka crossover. It will soon be launching its all-new Astra compact with EMP2 architecture from PSA.
As mentioned earlier, Dodge does not look equipped to continue as it has. Emissions compliance will be the big question mark, but what should Stellantis do about how old the remaining platforms are? In 2020 sales dropped almost 40% from 2019. Without something happening soon Dodge will be gone.
The same can be said for Chrysler; but even more so. When Fiat Chrysler unveiled its five-year plan in 2018 nothing was seen in the Chrysler category. Either it will be fleshed out with rebadged PSA products or quietly evaporate as it appears is happening now.
While Chrysler is a brand without an image, Alfa still has a strong image in spite of its poor showing in the US. The downside for PSA is that it hasn’t made a dime in 25 years. How do you justify continuing a brand when it loses money for almost three decades? You don’t. In 2022 a new small SUV and compact SUV will appear. What happens to the rest of the line is a question mark.
The DS is a luxury variant of Citroen meant especially to appeal to the Chinese market. It has been profitable despite low sales. Without a lot of recognition around the world, it might make sense to kill the DS brand and put some of that saved capital into Alfa. What do you think?
Another nameplate with very limited recognition outside of Italy. With only one model called Ypsilon, since 2016, it looks like this is the end of the line for Lancia.
Maserati will undergo a complete transformation and become electric; much like Cadillac is trying to do. Sales are expected to be in the 75,000 range by 2024 according to Automotive News. Maserati is ready to debut its Grecale SUV based on Alfa’s Stelvio architecture. Stellantis has already said it plans further involvement with Maserati within Stellantis.