Chrysler Hybrids: Priced and Ready for Sale -- Finally
By Michelle Krebs June 18, 2008By Michelle Krebs
Chrysler is touting the fact that it has priced its 2009 Dodge Durango Hemi Hybrid and 2009 Chrysler Aspen Hemi Hybrid below similar ones offered by General Motors and that it is moving up their introduction to August.
Hold your horses -- or kilowatts -- Chrysler.
Chrysler is very late to the hybrid party. In fact, it is dead last among the Big Six automakers selling vehicles in the U.S. And even these hybrids are later than Chrysler had promised.
Plus a price discount compared with GM models is consistent with the current price ladder; Chrysler's non-hybrid versions of its SUVs are priced less than its competitors.
Chrysler's First Hybrids
The 2009 Dodge Durango Hemi Hybrid and the 2009 Chrysler Aspen Hemi Hybrid, being shown off the to media in the Northeastern U.S. this week, are Chrysler's very first hybrids.
Ford was first to introduce a hybrid SUV with the now hot-selling Ford Escape and Mercury Mariner. General Motors now sells two and soon three 2-Mode hybrid SUVs as well as hybrid versions of the Chevrolet Malibu and Saturn Aura and Vue. Nissan started selling an Altima hybrid last year. Toyota and Honda -- well, they are light-years ahead of Chrysler and everybody else in offering hybrids. Toyota's Prius alone outsells entire full-line brands.
When Chrysler originally announced that the Durango -- and later the Aspen -- would use the GM-Daimler-BMW developed 2-Mode technology also used in the Chevrolet Tahoe and GMC Yukon SUVs, the automaker said its hybrids would go on sale in the first quarter of 2008. Appropriately GM, which brought the partners together to develop the innovative technology, got a head start of several months with the Tahoe and Yukon. Then Chrysler quietly pushed back the launch until late 2008. Now Chrysler is saying it's pulling it forward to go on sale by the end of August.
Priced Thousands Below Competition -- Of Course
Chrysler's headline on its press materials screamed customers would save "green" because its hybrids list at thousands below the competition -- nearly $8,000, by Chrysler's calculation. Indeed, that's not chump change.
The Manufacturer's Suggested Retail Price for the Durango Hybrid is $45,340, including $800 for destination. The MSRP for the new Aspen Hybrid is $45,570, including $800 for destination. Chrysler said customers are expected to receive an estimated tax credit of $1,800.
The automaker's hope is that pricing the Dodge and Chrysler hybrids, which list at about $3,600 less than the traditional versions, will attract consumers hungry for more fuel-efficient vehicles.
"The new 2009 Chrysler Aspen Hybrid and Dodge Durango Hybrid deliver fuel economy up to 20 miles per gallon -- a 40-percent improvement in the city and 25-percent overall -- best-in-class cargo room, and are priced nearly $8,000 below the competition," Deborah Meyer, Chrysler vice president and chief marketing officer, said in a statement.
The price ladder is obvious. An analysis by Edmunds.com, parent of AutoObserver, shows the average transaction price of a standard-issue Chevrolet Tahoe has been nearly $9,000 more than the regular Dodge Durango. "It only makes sense that the hybrids be priced in a similar fashion," said Ivan Drury, an industry and pricing analyst for Edmunds.com.
Plus, Chrysler's price advantage is halved when GM's current rebates of $4,000 on the slow-selling Tahoe and Yukon hybrids are taken into account.
"The pricing gap between the GM and Chrysler hybrids is marginal -- unless we see Chrysler offering incentives the minute theirs hit showrooms in August," said Drury. Perhaps an incentive like Chrysler's $2.99 a gallon gas-price guarantee?
Even at full sticker for the $50,000-plus Tahoe and Yukon, GM executives have said they are eating the cost of the expensive new technology until it builds volume. Chrysler won't say if it will make money on the hybrids but likely it won't.
Still, Chrysler claims consumers can expect to save 200 gallons of gas per year, an annual savings of $800 at $4-per-gallon. Consumers will pay off the hybrid premium in a couple of years, Chrysler insists.
Future of Chrysler Hybrids?
What's been curious as well is the future of the Durango and Aspen hybrids. The pair is built at Chrysler's Newark, Delaware, assembly plant, set to close.
Still, Chrysler has said it will expand the use of the 2-Mode hybrid technology, including to its Dodge Ram pickup by 2010. That's about the same time Chrysler will build a version of the Ram for Nissan to replace the Japanese automaker's Titan. The two automakers haven't said if Nissan gets a hybrid version the pickup.
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