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Chrysler’s Hybrid Strategy Unfolding

Chrysler confirms its hybrid technology is compatible with its new Phoenix family of V-6 engines.

Chrysler Group offers another peek under its hybrid strategy tent with Monday’s confirmation the auto maker will build a gasoline-electric version of the Chrysler Aspen fullsize SUV.

The chief of corporate parent DaimlerChrysler AG’s hybrid-electric vehicle development program tells Ward's the auto maker’s hybrid technology is compatible with its upcoming Phoenix family of engines, suggesting a 6-cyl. HEV is plausible.

“It’s kind of a universal technology that works well with the V-8, but definitely also works with the V-6s,” says Andreas Truckenbrodt, executive director-DC hybrid programs.

The new Phoenix V-6 engine family is scheduled for production in 2009 at a new $730 million engine plant planned for Trenton, MI.

The Aspen is the second confirmed vehicle program that will benefit from Chrysler’s hybrid system, developed in a joint venture with General Motors Corp. and BMW AG. The Dodge Durango, Aspen’s platform-mate, is the other.

Both hybrids will feature Chrysler’s vaunted 5.7L Hemi V-8 as their primary power source.

“We believe it really makes sense to offer this technology not only on the Dodge brand, but also on the Chrysler brand,” Truckenbrodt says, declining to reveal when production will begin. Nor does he say whether the Aspen Hybrid program was accelerated to launch alongside the Durango Hybrid.

Ward's previously had been told the Durango Hybrid production was set for December and that Aspen Hybrid required its own ramp-up, independent of the Dodge’s debut.

Chrysler dealers are a happier lot because of the Aspen Hybrid news.

“The whole world is waiting for Chrysler to build some kind of hybrid,” says Al Kutakh, sales manager of Los Angeles-based La Brea Chrysler Jeep in Los Angeles.

Word of the Aspen Hybrid program comes as gasoline prices inch toward 2005’s record levels. The American Automobile Assn. reports the national average for a gallon of regular-grade gas is $2.97 – $0.30 higher than one month ago and just $0.09 below the all-time high of $3.06, recorded in September, 2005.

“I believe the (Jeep) Patriot, Compass, (Chrysler) Sebring should all be available as hybrids,” Kutakh adds, referring to the auto maker’s new Jeep-brand cross-utility vehicles and pentastar-brand’s new midsize sedan.

“The hybrid market is super hot right now,” he says.

Through March, hybrid vehicle sales were up 54.4% compared with first-quarter 2006, according to Ward's data.

Related document: Ward's U.S. Light Vehicle Hybrid Sales March 2007

But some industry observers are skeptical about the Aspen Hybrid’s chances to impact that market.

“People who buy hybrids want to proclaim their ‘green-ness,’” says John Wolkonowicz, an analyst with Global Insight Inc. “That’s why the (Toyota) Prius outsells all other hybrid vehicles combined.”

Through the first three months of this year, the Prius sedan – unique in its appearance compared with the rest of Toyota’s lineup – accounted for 52.7% of the U.S. hybrid market.

“So, if they put a whole new front end on the vehicle, or something, and made it look nothing like the other Aspen, yes (it will thrive),” “But this way, it’s going to be a minor player,” Wolkonowicz suggests.

Kutakh, however, disagrees. He says the technology, itself, is magic in the marketplace.

“The word ‘hybrid’ brings people in,” he says.

Chrysler is mum on volume projections for the Aspen Hybrid, but sales of the conventionally powered version already have eclipsed last year’s total of 7,256. Production was launched mid-summer.

Truckenbrodt is optimistic about sales prospects for the Aspen Hybrid, if only because consumers have shown genuine affection for the Hemi.

The Hemi take-rate – for the 5.7L version and the 6.1L iteration, across the entire Chrysler product line – was 38% through first quarter 2007. And since the engine was introduced in 2002, about 1.1 million units have been sold, the auto maker says.

“People like this engine,” Truckenbrodt says. “They like the (Aspen) with that engine. And they need the space and the power. Now, what they can do is have fuel economy (improvement), but not having to really suffer or give up performance.”

For the Aspen and Durango hybrids, Chrysler forecasts a 40% fuel economy improvement in city driving and a 25% boost in combined city-highway driving.

That portends performance in the range of 18.2 mpg (12.9L/100 km) in the city and 21.9 mpg (10.7L/100 km) combined.

Truckenbrodt says Chrysler’s hybrid technology also enhances the effectiveness of its trademark Multi-Displacement System, which shuts down half the Hemi’s cylinders at cruising speed. On its own, MDS generates a 10% fuel economy boost.

“MDS is a major part of the (hybrid) system,” Truckenbrodt says. “We can extend the range where we can switch into MDS. We have the electric motor helping in some regimes where usually you would not want to go, for comfort reasons, for instance. Or performance reasons. We can do that now.”

The hybrids will be built alongside the conventionally powered Aspen and Durango at Chrysler’s assembly plant in Newark, DE. The site is slated for shutdown in 2009 as part of the auto maker’s restucturing initiative.

Chrysler says Monday’s announcement had been planned for some time and was not linked to rising gasoline prices, which have made headlines across North America.

Meanwhile, GM introduces its fullsize SUV hybrids to automotive journalists today.

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