Dieter Zetsche, chairman of the management board of Daimler, offered some pointed advice to Chrysler at a recent media round table. Zetsche, who was once CEO of Chrysler before it split from Daimler in 2007 offered criticism of Fiat’s plan to bring Chrysler back from the brink of extinction. Fiat, which now manages and partly owns Chrysler, devised a five-year, $23 billion overhaul that would focus on revamping the Chrysler, Dodge and Jeep models and feature some smaller, more compact designs.
Zetsche, however, made a point to warn Chrysler and Fiat that “American buyers still like large cars and SUVs,” according to USA Today. Zetsche said that he would advise Sergio Marchionne, Chrysler’s CEO, to “not focus exclusively on small cars going forward. I do believe successful continuation of SUVs and large cars is necessary.” I personally know this to be true by all the people who call in for our larger engines for sale Zetsche extended his missive to all U.S. automakers – all of which are going through a transformative phase. Ford, for example, has been pushing small subcompacts in India, with the American version of the Ford Fusion, a mid-size car, taking the Motor Trend Car of the Year award. Foreign companies also seem to be hopping on the “small car bandwagon” with Fiat and Hyundai expanding to India to cash in on the small car craze.
But in the U.S., Zetsche points to the U.S.’s leveling fuel prices as a sign that SUVs and larger vehicles will remain profitable and popular. Indeed, the initial backlash against so-called “gas guzzlers” when gas prices skyrocketed up to as high as $3 a gallon in 2006. But now, as the price of gas seems to have dropped back down (and appears to be staying back down), there’s less of a clamor for diminutive fuel sippers like Daimler’s own Smart car, which has had flaccid sales in the U.S. The recent Cash for Clunkers program, which urged Americans to trade in their fuel inefficient vehicles for new, more energy conscious models, certainly illustrated the undying penchant for big cars and trucks in the States – the most popular trade in was a swap between an old Ford F150 pickup and a new Ford F150 pickup.
On this note, Zetsche shows that Daimler plans to practice what it preaches. Though he said there were no plans of dropping the Smart car, he did note that a four-passenger model for the U.S. was under consideration. Without hinting at any sort of timetable, Zetsche said that Daimler plans to develop four variants of the Mercedes A-Class that would not necessarily be “very small cars” but would use smaller-displacement gasoline engines and more diesel engines that would make them more fuel efficient.
While there appears to be at least one dissenting voice over the merits of smaller cars, it seems that auto engines, at least, will be getting smaller across the board.
