The need to lower costs is driving the group to product development partnerships with affiliates Mitsubishi Motors Corp. in Japan and Mercedes-Benz in Germany.
The trick for Chrysler group will be using those architectures and components - and sometimes even platforms - to create vehicles that don't look Japanese or German.
Chrysler group CEO Dieter Zetsche insists that the Dodge, Chrysler and Jeep brands will continue to introduce vehicles that reflect Chrysler group's 'all-American heritage and all-American brands.'
Under the product development program, Chrysler group will develop small and mid-sized cars with Mitsubishi and full-sized, rear-wheel-drive cars with Mercedes-Benz. Such sharing frees up resources for Chrysler group to concentrate on its forte - pickups, minivans and sport-utilities.
Mitsubishi and Mercedes-Benz, meanwhile, will tap into this expertise. The next-generation Mercedes-Benz M-class sport-utility, for example, will be developed with the 2004 Jeep Grand Cherokee. The vehicles will share architectures and components that buyers can't see.
Besides cutting development cost, the strategy gives Chrysler group access to Mercedes-Benz know-how. By sharing what DaimlerChrysler executives call a common 'electronic architecture,' Chrysler will be able to use electronic stability control, navigation systems, adaptive speed control and other technologies it previously couldn't afford to develop.
Jeep, the crown jewel of the Chrysler group and a brand known worldwide, will expand into new market segments. Richard Schaum, the group's chief engineer, said Jeep needs an entry-level vehicle 'like Chrysler has with the PT Cruiser.'
'That is the idea we are toying with; every brand has to have its entry model, but this will be a true Jeep,' he said.
Chrysler continues to wrestle with quality and safety issues. Procedures instituted by Zetsche have created a stricter development program. A series of quality gates is similar to those used at Mercedes-Benz to meet safety, quality and cost targets.
The 2004 Chrysler sport wagon, code-named CS, is the first vehicle being scrutinized. The vehicle's launch has been delayed six months because of cost problems and the vehicle's failure to do well in company crash tests.
In addition, Chrysler has instituted a product development organization to help it reach quality, cost and safety targets. The platform teams have been retained, but they are more directly tied to manufacturing, purchasing and marketing.
The first vehicles that will be developed under this program likely will be the Dodge Intrepid and Chrysler Concorde replacements.
Here are Chrysler group's vehicle plans for the 2002-2005 model years.
* CHRYSLER, DODGE CARS
Chrysler and Mitsubishi jointly will create the next-generation Neon, due for the 2004 model year. Mitsubishi will take the engineering lead, while Chrysler will handle styling.
The next-generation Neon sedan will be based off the platform created for the 2002 Mitsubishi Lancer, the replacement for the Mirage. The Lancer went on sale this year.
The 2004 Neon likely will use Mitsubishi engines and transmissions.
Mitsubishi/Smart Z Car
DaimlerChrysler's Smart division in Europe and Mitsubishi are jointly developing a subcompact, code-named Z. The Mitsubishi-badged car goes on sale in 2003 in Japan and 2004 in Europe.
While there are no plans for Mitsubishi or Smart to sell the car in the United States, there has been discussion about selling it here through Dodge dealers. Dodge's image is best suited for a small, spunky car. Smart vehicles are painted in bright colors and geared toward the youth market. Whether the car would be rebadged as a Dodge is unclear.
Chrysler Concorde, 300M; Dodge Intrepid, Charger R/T
Good-bye, cab-forward styling. Chrysler group's full-sized car program, code-named LX, will use major components from the next-generation Mercedes-Benz E class, which debuts in September at the Frankfurt auto show. The full-sized Chryslers and Dodges will bow in the 2004 or 2005 model years.
The switch to rwd dictates a new approach to styling that will greatly change the appearance of the Intrepid, Concorde and 300M replacement, which likely will be called 300N. Also planned is a performance model for Dodge, the Charger R/T. The cars are expected to be shorter than the 2001 Intrepid and Concorde, but the wheelbase likely will be longer.
The LX cars will offer the stability control system developed by Mercedes-Benz. The vehicles won't share the E-class platform, but they will use a common electronic architecture as well as Mercedes-Benz transmissions, steering columns, and ride and handling components.
In what could be a risky strategy, the full-sized Chrysler and Dodge cars will be repositioned by pricing them a little higher than the current models. The automobiles will be aimed at more upscale buyers and away from the mainstream sedan segment led by the Toyota Camry, Honda Accord and Ford Taurus. This repositioning will allow the Chrysler group to market stability control, for example, at an audience that has deeper pockets.
The model lineup will be expanded. Some Chrysler models will be offered in sedan and convertible body styles, while the Dodge line will offer sedans and coupes. The Dodge models will continue to look sportier than the Chrysler vehicles and be priced below them.
The V-6 engines in today's cars will be carried over, and the 5.7-liter V-8 may be offered.
The introduction of the LX cars will be staggered, with the sedans coming in the 2004 model year and the coupes and convertible a year or so later.
Chrysler Sebring, Dodge Stratus
A new range of front-wheel-drive, mid-sized cars jointly developed by the Chrysler group and Mitsubishi will replace the current Chrysler Sebring and Dodge Stratus as well as the Mitsubishi Galant sedan. The Sebring convertible is expected to remain in the lineup, but the low-volume Sebring and Stratus coupes may not.
Mitsubishi has been developing a mid-sized platform, slated for the redesigned 2004 Mitsubishi Montero Sport, 2005 Galant and 2006 Eclipse. Chrysler executives say the U.S. maker will head the car program created from that platform, but details have yet to be worked out. The new Chrysler and Dodge cars will be launched in the 2005 or 2006 model year.
Dodge Viper RT/10
The 2003 Viper RT/10 receives its first redesign since the V-10-powered roadster debuted in the 1992 model year.
The 2003 Viper receives a new chassis, more powerful V-10 engine, reworked suspension and interior refinements. And, for the first time, the convertible will have a folding top.
The 8.3-liter V-10 engine has been bored out; displacement increases from 488 to 505 cubic inches, and horsepower rises to 500 from 450. Torque is boosted to 500 pounds-feet, up from 490.
The interior and exterior are all-new, drawing styling cues from the Viper GTS/R concept car. The instrument panel features a 220-mph speedometer and a push-button starter.
The redesigned Viper RT/10 is expected to go on sale in August 2002. The redesigned Viper GTS coupe could bow three or four years after the new Viper RT/10.
With the demise of the Plymouth brand this year, the Prowler was rebadged a Chrysler. No changes are planned in the near future for this retro hot rod, and there is no timetable for a replacement.
When the Prowler was launched in the 1997 model year, the intent was to create some excitement for the Plymouth brand. But with the brand dropped, the mission for the Prowler is unclear.
Chrysler PT Cruiser
Why tamper with success? The hot-selling PT Cruiser is virtually untouched for the 2002 model year. The 1930s-looking sedan receives more standard equipment and an optional flame appearance package.
Chrysler group has boosted annual production capacity at its Toluca, Mexico, assembly plant to 260,000 units to satisfy North American demand. Chrysler executives believe that with more capacity, more entry-level models can be built, appealing to a wider buyer base. Most of the vehicles sold have been loaded and have sticker prices over $20,000.
A 'woody' model featuring woodlike trim on the door panels and trunk lid will be new for the 2003 model year. That will be followed by the turbocharged GT Cruiser with more than 200 hp for the 2003 or 2004 model year.
A convertible based on the concept shown this year at the New York auto show could appear as a 2003 or 2004 model. A panel van is possible.
The life cycle of the PT Cruiser has been extended to six years, rather than the five-year average of Chrysler group vehicles.
* CHRYSLER, DODGE trucks
Chrysler, Dodge minivans
Once some of the most popular models in the market, the Dodge and Chrysler minivans have become me-too players in a crowded, competitive segment.
The minivans are critical to Chrysler group's bottom line, but sales of the redesigned 2001 Chrysler Town & Country/Grand Voyager and Dodge Grand Caravan minivans are being driven by $2,000 rebates.
Their styling has been blamed for the sales slide, along with stiff competition from the Toyota Sienna and Honda Odyssey. To some eyes, the 2001 Chrysler and Dodge minivans look too much like the older models.
The big job for Chrysler will be to cut costs per vehicle in ways the buyer can't see.
A freshening is planned for the 2005 model year.
Chrysler sport wagon
Chrysler joins the hot-selling sport wagon market with a new vehicle based off the Town & Country minivan platform.
The sport wagon, code-named CS, is targeted at the Lexus RX 300 and Acura MDX. Stability control and all-wheel drive will be offered, and a 3.5-liter V-6 is expected to be standard. Styling is based loosely on the Citadel concept.
The vehicle was scheduled to bow in the second half of the 2002 calendar year, but Job 1 has been delayed six months because of massive cost overruns and safety concerns. The front of the vehicle is being re-engineered so that it receives a five-star rating in government crash tests.
The sport wagon is expected to begin production in the first quarter of 2003 as a 2004 model.
Smooth ride, improved handling and a quiet passenger compartment are some of the goals for the redesigned 2003 Durango.
The sport-utility will be new from the frame up.
The new hydroformed frame from Magna International Inc. in Aurora, Ontario, is lighter than the current frame and should help reduce squeaks and rattles.
The Durango's styling is expected to be more refined in an effort to move the vehicle upmarket.
The PowerBox concept vehicle shown at this year's Los Angeles auto show offers hints on styling. The concept featured a tailgate that opens to the side rather than down, similar to that on the Jeep Liberty.
The PowerBox has 24 percent more interior room than the Durango and seats eight passengers. Despite the increased interior room, the concept was only about 1 inch longer than the current Durango.
Three engines will be available: the 3.7-liter V-6, 4.7-liter V-8 and 5.7-liter V-8.
A hybrid-powered version, pairing a 3.9-liter V-6 engine with a three-phase induction electric motor, will have awd. It is expected to go on sale in the 2004 model year.
Chrysler anticipates the hybrid Durango will represent about 15 percent of the vehicle's annual sales. The option will cost about $3,000.
Dodge's mid-sized pickup will be redesigned for the 2003 model year and will be developed on a new, lighter frame. Chief goals: reducing noise, vibration and harshness. The Dakota also will take styling cues from the Power Wagon concept.
Mitsubishi wants a version of the Dakota for its U.S. dealers. Although discussions have taken place, no decision has been made.
Chrysler group hopes to score a big hit with its redesigned full-sized pickup and rekindle the intense competition the Ram once presented to Ford, Chevrolet and GMC.
The 2002 Ram 1500 pickup is new from the frame up. Considerable attention was paid to reducing noise and vibration and to giving the pickup a better ride. The pickup is 3 inches longer than its predecessor and has more interior room. Side curtain airbags that protect front and rear passengers are optional.
Engines include the new 215-hp, 3.7-liter V-6 and the reworked 235-hp, 4.7-liter V-8. The 245-hp, 5.9-liter V-8 is carried over from the current Ram.
The 2002 Ram 2500 and 3500 models are carried over from the 2001 model year. A redesign is planned for the 2003 model year. Insiders say the redesigned 2500 and 3500 models will have unique styling that separates the pickups from the Ram 1500 series.
Fuel economy will be boosted when the hybrid Ram pickup bows for the 2005 model year. The powertrain will use a 3.9-liter V-6 that automatically shuts off at idle and starts when the accelerator is depressed. The intent is to reduce gasoline use. The electric motor also will reduce the load on the V-6 during acceleration, thereby increasing fuel economy.
The vehicle's electric system will be able to generate electricity for tools and equipment.
Chrysler says the hybrid option will add about $5,000 to the truck's price, and it could account for 15 percent to 20 percent of the Ram's sales.
Dodge Ram Van/Ram Wagon
The full-sized vans will be dropped during the 2002 model year.
Zetsche wants to develop the Jeep brand by moving it into a new lower-priced segment. The new model won't be a typical sport-utility, insiders say. It likely will be a cross between two Jeep concepts - the four-door Varsity unibody vehicle and the Willys, a two-door off-roader.
The rugged entry-level Jeep Wrangler receives a reskin for the 2004 model year. Changes are expected to include a new grille and a composite top with removable roof and side panels. The 3.7-liter V-6 engine may be offered as an option. But an independent front suspension similar to that of the Liberty is not likely.
The Wrangler redesign is slated for the 2006 model year.
The all-new 2002 Jeep Liberty replaced the Cherokee this spring, sporting unibody construction, an independent front suspension and big V-6 engine.
Topping the engine range is a new 210-hp, 3.7-liter V-6 engine that is based on the Grand Cherokee's 4.7-liter V-8. A two-wheel-drive model with a 2.4-liter four-cylinder engine and manual transmission goes on sale this fall.
Insiders say the Liberty is priced at about $2,000 over Chrysler's target. Costs will be lowered through changes in suppliers beginning in the 2003 model year.
Jeep's flagship will be redesigned for the 2004 model year, and, for the first time, it will offer seven-passenger seating.
The new Grand Cherokee will share a significant number of components and architectures with the next-generation Mercedes-Benz M class, which will be redesigned around the same time.
Product Editor Rick Kranz contributed to this report.