Chrysler Group has set an ambitious sales target for its dealers in 2011: at least 1.57 million units, up about 45 percent from 2010, Chrysler told dealers at the franchise dealer meeting here today.
Chrysler said it would spend the money necessary to help them meet sales targets: an increase in ad spending of 68 percent over 2010 levels, starting with a two-minute commercial in the third quarter of Super Bowl. The company declined to say how much it is spending.
"They asked dealers to help them meet those goals," said Don Lee, president of Lee Auto Malls, a Chrysler-Dodge Jeep store in Westbrook, Maine. Lee said the target could be challenging.
"It's about 15 percent higher than my annual objectives. It's going to be tough, but I believe that they believe it's going to be done. They've got some great products," said Lee, whose sales increased by 35 percent in 2010.
Lee was referring to 16 new or revamped products Chrysler has for 2011.
In an interview Saturday, Fred Diaz, Chrysler's lead sales executive, said the new products are arriving in dealerships in volumes and currently account for 38 percent of dealer inventory.
"The goal is to be there at the end of the first quarter," in terms of having all the new products in dealerships. The Chrysler 300, made in Brampton, Ontario, has not shipped yet, he said.
On Sunday, Diaz told dealers they need to get their cars ordered, or they won't be able to cash in on the spring sales rush.
Dave Kelleher, owner of David Dodge-Chrysler-Jeep in Glen Mills, Pa., and a member of national dealer council said the factory urged dealers to act quickly: "We've got to order cars now. If you don't have the cars for the spring market, it's going to be too late for you to make your move."
Jesse Toprak, vice president of Truecar.com, said Chrysler could hit its targets if a number of factors go right: "1.5 million is reachable if the momentum of Jeep continues."
Chrysler also needs its mid-sized sedans - the new Chrysler 200 and the Dodge Avenger - to post sales increases and for a continued recovery in the construction industry to boost the Ram brand, Toprak said.
Chrysler told dealers it wouldn't start advertising products before they reach dealerships, an issue that caused some friction in the past.
"That's another thing we talked about - let's don't start marketing the product until we have it on the ground," said Lonnie Cobb, owner of Humboldt Chrysler-Dodge-Jeep in Humboldt, Tenn. Cobb said his sales increased 32 percent in 2010.
Cass Burch, owner of Cass Burch Chrysler Dodge Jeep in Valdosta, Ga, said Chrysler's plan to "build it, then advertise it" is in line with newfound discipline at Chrysler imposed by CEO Sergio Marchionne. "This is the most exciting time in my career to be a Chrysler-Jeep-Dodge dealer, said Burch, who has owned his store for 14 years.
Chrysler told dealers it will rely less on fleet sales in 2011, according to Bill Kelly, president of Kelly Cars Chrysler Jeep Dodge Ram in Moon Township, Pa.
Chrysler also told dealers it was on target to complete its Project Genesis dealer consolidation plan at the end of the year, meaning all of its dealers will have all brands under one roof. Currently 90 percent of Chrysler's 2,317 dealerships sell all three brands.
Peter Grady, Chrysler vice president of network, said the goal is in line with the target set on Nov. 4, 2009, when executives laid out a new five-year, post bankruptcy recovery plan.