30 October 2007

Chrysler getting ready to douche 3 sluggish models

Chrysler is about to dump three slow-sellers; The Pacifica, PT Cruiser and the Magnum are all expected to get axed as the company realigns their lineup. Scaling back products is expected to be the first of several major initiatives at Chrysler as it takes shape under the ownership of private-equity giant Cerberus Capital Management.

People close to Chrysler said the board, in its initial meeting under new Chairman and CEO Bob Nardelli, likely will approve plans to discontinue the Chrysler Pacifica crossover, the Dodge Magnum wagon and the PT Cruiser hatchback.

After just three months on the job, Nardelli is ready to put his stamp on Chrysler to make it leaner, quicker and more disciplined.

Nardelli said Monday that Chrysler is now "laser-focused" and committed to making decisions "with a bias toward speed," he said, "it's either a yes or a no, but not a slow maybe."

Super CEO Bob-o Nardelli

Since Cerberus bought Chrysler in August, Nardelli and his top executives have been poring over the product portfolio with an eye toward cutting underperforming or overlapping models. That effort has accelerated since Chrysler hired veteran Toyota executive James Press last month as its vice chairman and chief product strategist.

Sales of the three vehicles have tumbled sharply this year. While Chrysler's overall U.S. sales were down 3% through September, Pacifica sales have fallen by 30%, Magnum by 32% and the PT Cruiser by 27%. The company also may cut its Jeep Commander full-size SUV. Its sales are down 23% this year.

Nardelli, a longtime General Electric exec and former CEO of Home Depot, is moving to change the culture inside Chrysler at the same time he refocuses the lineup in its showrooms.

Rumours are Nardelli is pushing for leaner staffs and faster decisions. Chrysler is in the process of cutting more than 450 white-collar jobs and another 1,000 contract jobs.

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