Thumbs Down on Jeep Gladiator Production

Chrysler vetoes production of the Jeep Gladiator pickup because the profit forecast was unfavorable.

RUBICON SPRINGS, CA – Chrysler Group’s Jeep brand will not be returning to the compact pickup arena anytime soon, the auto maker’s chief operating officer says.

Chrysler executives had been contemplating a production version of the Jeep Gladiator concept that debuted at the 2005 North American International Auto Show in Detroit.

“It wasn’t profitable,” COO Eric Ridenour tells Ward’s.

The decision belies an unprecedented lineup expansion that will see Jeep’s showroom grow, by year’s end, to eight models from three.

However, while the Gladiator’s death threatens to disappoint dealers, brand enthusiasts and SUV aficionados in general, it may impress Wall Street as a sign of Chrysler’s shrewdness.

Chrysler has adopted a renewed focus on bottom-line performance as it fights to maintain momentum that has produced U.S. market share gains while cross-town rivals General Motors Corp. and Ford Motor Co. have seen their shares erode.

This discipline was demonstrated most recently by the caution exhibited in the face of overwhelming positive reaction to the Dodge Challenger concept car unveiled at this year’s Detroit auto show.

Despite the strong favorable consumer response, the final go-ahead was issued only after President and CEO Tom LaSorda ordered that the business case be based on the high-margin scenario of a limited production run and scaled-down volumes.

The Gladiator concept, which features bold styling that influenced the redesigned ’07 Jeep Wrangler, is based on a unique platform. But Ridenour told Ward’s previously that a production truck, if approved, would have been a niche vehicle based on an existing midsize body-on-frame architecture.

Meanwhile, Ridenour dismisses the notion Chrysler is squandering an opportunity to re-energize a segment where the top-selling product – the Ford Ranger – is also the segment’s oldest product. “We have Dakota,” he says.

Though redesigned for ’05, sales of the Dodge Dakota are down 30.6% through July, reflecting a first-half segment-wide slide of 10.3%, according to Ward’s data.

Gladiator production would have marked the end of a prolonged pickup market hiatus for Jeep. It stopped building the Comanche in 1992 after a 6-year run.

The decision to shelve the product also marks the second time in two years Chrysler has passed on a Jeep pickup. The Scrambler concept, which debuted at the 2002 Specialty Equipment Market Assn. (SEMA) show in Las Vegas, briefly was considered for production before the auto maker nixed the idea.

Jeep has a history of pickup production that dates back seven decades and includes nameplates such as the Honcho and Jeepster.

There even was a previous Gladiator, which ran from 1963 to 1970.

But Ridenour is loath to admit the latest Gladiator is dead and buried. Though short-term production plans have been killed, he adds: “You can never say anything long-term in this business.”

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