Chrysler seeks more diesels

CHELSEA, Mich. -- Fiat Group executives are looking at ways to produce more light-duty diesel engines for Chrysler Group vehicles.

So far, Chrysler's diesel experiment, which it launched last year, is working. Brand executives said demand is brisk for diesel-powered versions of the Ram 1500 pickup and Jeep Grand Cherokee SUV, the two vehicles that offer the 3.0-liter V-6 EcoDiesel.

EcoDiesel engine maker VM Motori, a wholly owned subsidiary of Fiat Group, has capacity to build about 100,000 of the diesels per year, a source in Italy said.

About half of those engines are destined for use in North America, with the rest used in other vehicles elsewhere across the globe, where diesel acceptance is stronger. The source said it could take less than 18 months to significantly expand EcoDiesel production.

Chrysler Group dealers in the United States began selling Jeep Grand Cherokees with the diesel last year and began offering the engine in the Ram 1500 half-ton pickup in March.

Both engines cost consumers more than the V-6 and V-8 gasoline engines available in the vehicles. For example, in the Ram 1500, the EcoDiesel stickers at $2,850 more than a similarly equipped pickup with the 5.7-liter V-8 Hemi gasoline engine.

With the diesel, the Ram 1500 is rated at a segment-leading 28 mpg highway, while the Grand Cherokee is rated at 30 mpg highway.

Ram brand head Reid Bigland said dealers have experienced "overwhelming demand" for EcoDiesel-powered Ram 1500s since the trucks arrived at dealerships.

"We got well in excess of 10,000 orders in just the first few days that we opened this thing up, and that ordering and demand has really sustained itself," Bigland said at a press event here. "We've sent word over to VM Motori and they're in the process of ramping up, but realistically, nobody can turn a switch to do the things that it takes to get ramped up, but they're in the process of doing it."

Jeep brand head Mike Manley said demand for EcoDiesel-powered Grand Cherokees, which have been available since 2013, has leveled off at about 8 percent. That would translate to about 15,000 EcoDiesel Grand Cherokees for 2014.

Manley acknowledged that demand for the engine in the Ram pickup has been strong, but so far, he said there is "no behind-the-scenes fight over allocation of diesel with Ram."

Bigland said diesel-powered pickups sit on dealer lots for an average of 13 days before being sold. That compares with 94 days for all Ram 1500s, according to Kelley Blue Book. Bigland said executives are balancing diesel demand between the Grand Cherokee and Ram 1500 for now, but wouldn't say whether Ram had asked Jeep for any of its EcoDiesel engines.

Said Bigland: "I'll keep that between Mike and me."