Marchionne pushes to end production bottlenecks
Suppliers being pressured to boost output in 2013; 'No vacations, no breaks'
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DETROIT -- Chrysler Group is pressuring suppliers to the Jeep Wrangler and Grand Cherokee to increase capacity after bottlenecks cost the company 60,000 to 70,000 lost sales globally in 2012, Chrysler-Fiat CEO Sergio Marchionne said at the show on Monday.
Marchionne said his purchasing team is on a mission to eliminate production constraints for Jeep's two best-selling vehicles.
"On the key products, I'm maxed out," Marchionne said in an interview with Automotive News. "We're investing now in de-bottlenecking all this. Anybody that supplies components to the Grand Cherokee is being pushed to increase capacity. Same thing with people that make Wrangler components."
The Jeep brand set a global sales record last year of 701,626 units, besting the previous record of 675,494 set in 1999. But Marchionne said supplier constraints cost the company as many as 70,000 additional sales.
"I didn't sell all the Grand Cherokees I could have sold, I didn't sell all of the Wranglers that I could have sold because I couldn't make them. There was a natural limitation to my ability to compete," Marchionne said.
That will change in 2013, the CEO promised. Chrysler previously projected to deliver 2.6 million vehicles in 2013, up from 2.4 million in 2012. But Marchionne said adding another 200,000 units for the coming year is not enough.
"We're going to try and push beyond 2.6 million in 2013. We've got a lot of work to do here, but the machine needs to be pushed," Marchionne said. "No vacations. No breaks."
Meanwhile, Marchionne said he was surprised when his company unexpectedly became a political lightning rod in the 2012 presidential campaign.
'Shock and disbelief'
The Romney campaign launched an ad in late October claiming that Chrysler intended to shift Jeep production to China. Chrysler shot back, saying the ad was untrue.
"I was just wondering why the hell we were being used as a discussion point in the elections," an incredulous Marchionne said. "I figure that we cut a deal with the government in 2009 -- they lend me money, I paid you back less than two years later with 19 percent interest, and I want to know why you're yanking my chain?"
Marchionne said the statements regarding Jeep caused "shock and disbelief," at Chrysler, and that he worried for the company's 60,000 employees.
"You read the newspaper and you read the press and you keep on seeing people who are making statements about your company that are untrue," said Marchionne. "I thought it was unfair, but who am I to say? I'm just another bastard. I just make cars."
You can reach Larry P. Vellequette at lvellequette@crain.com.
