Take My Pickup -- Please!By Bill Visnic February 22, 2011
It took the Chrysler Group LLC about an hour to respond at the recent Chicago auto show, where Hyundai Motor America president and CEO John Krafcik publicly declared theres a price war going down. Chryslers answer took an intriguing direction: the launch of the Tradesman, a new variant of the Ram fullsize pickup, stuffed with the companys Hemi V8 but priced barely more than a well-equipped compact car. It quickly followed up the Tradesmans unexpectedly positive Chicago-show buzz by announcing a similarly-priced companion Ram model, tentatively named Adventurer and targeted at first-time buyers.
Its a provocative play for Chrysler on several consumer levels, but the root strategy is nothing more complicated than a grab for market share its an incentive without having to call it such. A strategy to parry a recent heavy hike in incentives by General Motors Co. and expanding spiffs Toyota Motor Sales USA has warned it wont be afraid to deploy, either.
Industry captains like Krafcik fear the two giants wont be able to help themselves, a couple of sloppy drunks with flush pockets that arent able to stay out of the incentives saloon. Chrysler, bereft of fresh product during its restructuring had no choice but to resort to scandalous incentives; now, it would like to keep some hard-won margins and maybe carefully score some new market share all without having to take up arms in the nascent price war.
How else to view the new duo of Ram Adventurer and Tradesman that respectively go out the door for less than $24,000 and $23,000 with the 390-horsepower Hemi, automatic transmission, air conditioning and no shortage of other standard equipment? In the Hemis mid-2000s heyday, it commanded thousands as the centerpiece of pricey option packages and now Chryslers giving it up in a $23,000 pickup?
Fact is, Chryslers not really giving away much of anything. The new Ram models include some minor extra content, but according to Edmunds.coms proprietary True Market Value pricing metric, customers already could buy similarly-equipped Rams Hemi and all for money comparable to the ballyhooed Tradesman and Adventurer prices that are causing such a ruckus.
Its a gambit worthy of a full season of Mad Men, fabricating excitement for an aggressive price that effectively was already there.
Chrysler surely would like to sell more Rams. It surely would like to sell more Hemis. But it surely would prefer to stay in the rear areas if the industrys deep-pocket players truly are gearing up for an incentive war and Chryslers marketers have, for now, conjured a wily tactic to do just that.