Chrysler tilts toward higher mpg

Automaker plans to revisit models, tweak efficiency with hybrid and diesel engines.

Christine Tierney and Scott Burgess / The Detroit News

Chrysler LLC plans to balance out its lineup, which currently is skewed toward large vehicles, by adding fuel-efficient diesel-powered and hybrid models, company officials and dealers said.

The newly private automaker, acquired in August by Cerberus Capital Management, is currently reviewing its lineup to eliminate overlap between models and identify niches that Chrysler should exploit.

The company is also taking a hard look at slow sellers, such as the aging PT Cruiser. Dealers said CEO Robert Nardelli described it as one of the models that was a bit tired at a meeting last week in Las Vegas. "He said it hadn't changed since he bought one of the first models," said Ken Zangara of Zangara Dodge in Albuquerque, N.M.

Chrysler President Jim Press, a former head of sales at Toyota Motor Corp. and a popular figure with dealers, joined Nardelli.

"They've got the wheels in motion to turn this thing around quite quickly," Zangara said.

Other possibly endangered vehicles include the Chrysler Pacifica crossover and the Dodge Magnum wagon. The lackluster Sebring sedan, which is struggling in the cutthroat mid-size car segment, could undergo a radical overhaul, or be replaced. Last month, Toyota's Camry outsold the Sebring by more than six-to-one.

Chrysler spokesman Mike Aberlich said the company had not come to any final decisions on which, if any, models to eliminate.

The automaker, which generates most of its revenue from sales of light trucks and minivans, has been hit by rising gas prices. Its light truck sales are down 18 percent this year, while some of its sedans failed to capitalize on the shift in the market favoring car sales.

Chrysler, working with General Motors Corp. and BMW A.G., will begin selling gas-electric hybrids SUVs next year. The Chrysler Aspen and Dodge Durango hybrids show a 40 percent increase in fuel efficiency during city driving and a 20 percent increase on the highway, company officials said.

Diesels have also helped Chrysler showcase more efficient SUVs. Chrysler also began selling a Jeep Grand Cherokee with a 3-liter diesel engine this year that reaches 23 mpg on the highway. Executives have said the engine could make its way into more vehicles. However, strict government emission standards in some states limit the company's options, until a better cleaner diesel is available.

The company is also investing in its 2.4-liter four-cylinder world engine, which has helped vehicles such as the Dodge Avenger, Jeep Patriot and Compass achieve more than 30 mpg. Chrysler announced in August it would begin making the engines direct injection capable, which could further increase the engine's efficiency and power.

The new Dodge Caliber compact is an improvement over its predecessor, the Neon, but doesn't stack up to the Honda Civic or Toyota Corolla, said Tom Libby, senior industry analyst at Power Information Network, a division of J.D. Power and Associates.

Libby said he expected Chrysler to radically overhaul or replace the Sebring in the mid-size car segment, which represents slightly over 13 percent of the market.

He said the outlook for the PT Cruiser was murky. "It's very old now, and I don't know how you change a retro model."