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Fiat's challenges become Chrysler's

June 24, 2009 at 4:33 PM   |   Comments

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AUBURN HILLS, Mich., June 24 (UPI) -- The challenge for the new Chrysler Group LLC may be to build a profitable mid-size vehicle for U.S. consumers, an auto industry analyst said.

"The biggest 'if' in this whole plan is how to develop the midsized sedan," said John Wolkonowicz at HIS Global Insight. Changes are already under way at the company resurrected from the bankrupt Chrysler LLC, which was taken over by Fiat of Italy two weeks ago.

Among them is Chrysler Group's intention to establish an American-made Alfa Romeo, which would compete with European luxury cars sold in the United States.

"In Europe the Alfa does go up against those other luxury brands fairly successfully," Wolkonowicz told the Detroit Free Press Wednesday.

On the other hand, a previous marketing partnership between Fiat and Chrysler only sold about 8,000 Alfas in the United States a year between 1990 and 1995.

Chrysler Group also plans to produce the diminutive Fiat 500 at its plant in Toluca, Mexico, which would be sold in the United States as the 500, dropping Fiat from its name.

"The Fiat name doesn't play in the U.S. and Fiat knows it," industry analyst Jim Hall at 2953 Analytics told the newspaper.

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