Fiat’s Five-Year Plan For Chrysler Leaks Early, Local Distribution In Question

DETAILS OF A special 'five year plan' to resuscitate US carmaker Chrysler have leaked early, thanks to sources contacted by the Wall Street Journal.

The plan, lead by Fiat and new Chrysler CEO Sergio Marchionne, calls for a number of Chrysler, Jeep and Dodge models to be retired or redesigned by 2012.

According to the WSJ's sources, the Dodge line-up will see the Caliber compact, Avenger sedan and Nitro SUV on the chopping block.

The Dodge badge is expected to become the company's performance brand, retaining the Challenger muscle car and the Charger sedan, along with the Journey SUV.

Dodge utes/pickups will be split off into a separate Ram brand.

The Chrysler brand will wave goodbye to the PT Cruiser in 2012, followed by the Sebring.

A redesigned next-generation 300C is expected to join the Chrysler line-up in 2012.

Jeep will lose the Commander, Compass and Patriot models, while the iconic Wrangler survives beyond 2012.

A new Grand Cherokee, revealed in April, is still on schedule for a 2011 launch.

Marchionne's plan is expected to replace a number of axed Chrysler models with Alfa Romeo and Fiat models in the US, where neither brand is currently available.

It is unknown how the plan will affect Chrysler's position in Australia or just who will control the brand here - along with Fiat and Alfa Romeo.

While Chrysler in Australia is a factory-owned outfit and no longer part of Mercedes-Benz, it remains tied in with Daimler's parts and distribution network.

Chrysler Australia would need to establish its network before it could think of securing the Fiat and Alfa brands in Australia, severing ties with Daimler in the process. This, of course, would be an expensive undertaking, and one the home office would be unlikely to fund.

Likewise, if Chrysler Australia found the means to fund its exit from the Daimler network, securing the Fiat and Alfa brands would likely be prohibitively expensive.

The other scenario is that Ateco, the current importer of Fiat and Alfa Romeo in Australia, could conceivably take over the Chrysler brand here. This would see Ateco absorbing Chrysler's three marques into its existing parts and distribution network and footing the bill itself.

A possible move to Ateco isn't without precedent: earlier this year, Chrysler in New Zealand packed its bags and handed distribution to local importer Sime Darby, the New Zealand distributor for Peugeot.

Whatever the outcome, change to the status quo for Chrysler and Ateco in Australia is unlikely to come any time soon. The American carmaker and its new Italian partner are fully focused on revitalising the brand (and introducing Fiat and Alfa models) in the larger US market.

The full 'five year plan' is scheduled to be revealed on November 4.