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Chrysler growth based on fleet

Chrysler Group is considering adding corporate sales requirements to its dealer standards as it continues a drive for sales growth.

In 2006 it broke the 20,000 unit barrier for the first time, achieving 38% growth over 2005’s volumes.

Managing director Peter Lambert says that as the Chrysler, Jeep and Dodge brands’ fleet volumes grow it may become necessary to make corporate sales a dealer requirement “in a few years”, although he believes in using “the carrot rather than the stick” and would prefer dealers to buy-in voluntarily.

“More than half of all new cars in this country go to corporate sales. We’re making huge investments in bringing out C-segment and D-segment cars for the fleet sector. This is an opportunity for dealers to gain revenue from sales of vehicles and, longer term, revenue from aftersales,” he says.

Dealers are planning to extend workshop hours for servicing, and business centres will be in place at 25 dealerships by the summer.

Chrysler Group is forming a dedicated fleet team of six representatives who will deal with large user-chooser fleets, leasing companies, and the contract hire and leasing industry.

There are currently 88 Chrysler Group sales outlets, but Lambert wants to increase that to 100 by the end of 2007, and is talking with current franchise partners. He hopes they will appreciate economies of scale if they take on a neighbouring open point.

In November, Jardine Motors Group opened Lancaster Lakeside in Essex, its third Chrysler dealership. In the next few months,

SG Smith will open an authorized service centre in Sydenham and Dutton Forshaw will open a showroom in Battersea, London, its second.

“The growth that we had last year has filtered down to the bottom line, and this year it should do the same,” Lambert says.

“Dealers are investing huge amounts in facilities and we want them to have a good return. Return on investment is improving, and we have more room for improvement. Our top quartile is very profitable and we want to bring the average up to performance in the top quartile.”

The top performers show a direct link between their success and excellent CSI ratings, so the manufacturer is on a roadshow this quarter to ask dealership staff how they feel they can improve customer service. It will be based on a similar initiative carried out by Mercedes-Benz last year.

“It’s about bringing every-body up to the same level and giving them a chance to have their say,” says Lambert. “Now we’re growing rapidly we need to attract new customers and one of the best ways to do that is through referrals from happy customers.”

Dealers are expecting a raft of new models. Jeep Wrangler, Wrangler Unlimited and Compass are due in April. Chrysler Sebring is out in June, followed by Dodge Nitro and Jeep Patriot in July, and Dodge Avenger in September.

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