Chrysler-Nissan Discuss Small Car, Big Truck Sharing
By Michelle Krebs December 17, 2007Chrysler and Renault-Nissan reportedly are in talks to do some sharing â- sharing of technology, engines and vehicles, specifically small cars and large trucks.
Nissan sources in Japan confirmed to AutoObserver that the talks of a global deal are ongoing and that some sort of announcement could come âfairly soon,â though thereâs no guarantee a deal will ultimately be finalized.
The discussions center around Nissanâs desire for a large U.S.-made truck and Chryslerâs desperate need for small cars â- Nissan Sentra size and smaller, sources told AutoObserver.
Officially, Renault-Nissan refuses comment. Chrysler CEO Robert Nardelli told reporters at the companyâs media holiday party last week that he had not spoken with Renault-Nissan CEO Carlos Ghosn about joint ventures. Indeed, AutoObserver sources in Japan confirm the two have not met on the topic.
Nardelli told the Detroit Free Press he had not talked with Ghosn about a Nissan-Chrysler link. "I read the article (on Bloomberg News...and that's the first time I heard about that," he said. "I know Carlos. ... I have not had any discussion with him on that." Pressed harder as to whether the report was untrue, Nardelli said, "I think we said 'no comment.'"
Still, Ghosn has made no secret of the fact that he wants a partnership with a North American company, and heâs running out of options. Only Chrysler remains as a possibility after talks with General Motors led to nothing and Ford CEO Alan Mulally said Ford would go it alone.
A Chrysler-Renault-Nissan deal, likely would be a joint venture on a specific project, sources in Japan told AutoObserver. There has been not talk of equity swaps. In fact, Chrysler is now privately held. Meantime, a joint venture arrangement would not be unprecedented for Nissan. It has other shared arrangements, including minicars built by Suzuki and Mitsubishi for Nissan in Japan.
Small Cars for Chrysler
Chrysler is in dire need of a small B-segment car for various markets. In North America, tiny fuel-efficient cars like the Nissan Versa and Honda Fit have been red-hot for sales due to high gas prices. No let up in demand in the segment is in sight. In international markets, the focus of Chryslerâs expansion, B-segment cars are the vehicles of choice.
Chrysler had been counting on such a small car from its Chinese partner Chery by early 2008, but the timing of that has been pushed further into the future, if it materializes at all.
The original plan was for Chrysler to have a Chinese Chery-built car to sell in the U.S. by early 2008 and by year-end in Central America and Eastern Europe. However, a Chery official recently said at a China automotive conference in Detroit that the two companies are in the âconceptualizationâ phase that could take a couple of years as the companies consider various options.
Chrysler canât wait that long, nor can its private equity owner, Cerberus Capital Management. Chrysler is under increased pressure for fuel-efficient cars with new fuel-economy standards in the offing in the U.S.
Big Trucks for Nissan
A deal could include Chrysler building trucks for Nissan. Again, such an arrangement is not unprecedented for Chrysler, which now builds the Dodge Dakota-based Raider for Mitsubishi.
Ghosn, in an interview with Newsweek, reportedly talked about killing the Nissan Titan. The full-size pickup was plagued with quality problems in its early days and has failed to live up to expectations as Nissan, like Toyota, have found it difficult to penetrate the fiercely loyal owner ranks of the domestic truck makers.
Chrysler is on the eve of unveiling its new, dramatically restyled Dodge Ram; it will be unveiled at the Detroit auto show and goes on sale as a 2009 model.
Nissan just announced a deal whereby it would produce midsize trucks based on its Tennessee-built Frontier for Suzuki.
Some speculation also has Chrysler providing Nissan with minivans; Chrysler is building a minivan for Volkswagen as well. Nissanâs quirky Quest has never made much of a dent in the minivan segment.
Parts-Sharing to Cut Costs
Another aspect of talks with Renault-Nissan and Chrysler likely has to do with parts, sharing parts and using their combined volumes to exact the best prices globally on parts. Thatâs been a major benefit of the Renault-Nissan link as well as the Chrysler-Daimler one. Chrysler executives have said they plan to increase Chryslerâs global parts buying.
The Wall Street Journal reports Monday that Chrysler and Nissan are looking at possibly collaborating on powertrains as well. Chrysler already has a global engine making deal with Mitsubishi and Hyundai.
Story written by Michelle Krebs with contributions from AutoObserver's Tokyo correspondent Peter Nunn.
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I've said it before and I'll say it again; Porsche/Volkswagen/Seat+Mopar. You get A- and B segment cars union built in the US/North America, and hey! How about a 1 ton crew cab dually Porsche? One really should'nt tow ones' Maritimo 48 behind a Dodge, after all.
Porsche is gathering momentum (and VW!) and with the dollar US expected to remain low against the Euro, Chrysler can bring tens of millions of square ft of production space and more dealers in some cities than Porsche has in some countries. Perhaps start with an 70's Chrysler/Mitsubishi type of arrangement. Chrysler needs Product, P/VW/S needs production-cost/parts sharing, Cerberus needs to get out of Sterling Heights, Michigan. works for me.
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