Re: IML: More News of New Imperial

[Christopher H <imperial67@xxxxxxxxxxxxx>]

Title: Re: IML: More News of New Imperial

As I have mentioned before here, I had the opportunity to spend a good twenty minutes one-on-one with the design lead on the Imperial concept at the Detroit show this January. I was quite honest (though polite) with my opinions of the concept, showed him pictures of my ‘67 Crown, told him of my other Mopars, and just to let him know I don’t live only in the past, shared with him my affection for numerous new cars (including the 21st-century Mopars I own and my experience in...sorry, Mark, marketing for numerous brands, including the one started by the other name in DaimlerChrysler). It was an enjoyable and intelligent conversation, and it made me realize that the thinking behind the new imperial, regardless of the concept’s design, is a strong idea.

Consider a few points:

The 300 was the first domestic sedan in a very long time, perhaps ever, that has been able to attract former import shoppers. Did people trade down their Benzes and BMWs for them? Not so much. But they have traded Lexuses and Infinitis, and more importantly, many of them who would never have considered a Chrysler traded other domestic brands or traded up from imports such as Camry, etc. (Many of them chose the funof the 300 over the boring safe route of the Camry). The 300 conquested new buyers to Chrysler because they were willing to risk some quality for style and fun. 

Another key point is that the 300 ranges in price from the mid-$20s to about $40k. A similarly sized import, from Europe or Japan, is a $45-60k car. People who bought 300s felt they were trading up. The Imperial (as an idea, again, not the concept car per se) aims for a higher segment of the market. So it’s not looking just to be a fancy 300, but to go after a different buyer. (Part of the problem with the 300 is that, with no Plymouth around, it also reaches too far downmarket to reach much further up than it does.)

At the moment, there really are few aspirational domestic sedans other than the 300C and 300C SRT8 (I might suggest there are none). Cadillac’s DTS and Lincoln’s Town Car simply do not make the statement that they did parked in your driveway 40 years ago. While the DTS makeover resulted in a very nice car, it’s a front-wheel-drive sedan with an older buyer’s image, not a successful boomer’s image. The Town Car is most often seen in the form of an airport limo. That’s their image, plain and simple. So Joe Eberhardt (who is a boomer, by the way), is 100% correct in recognizing the same thing the lead designer discussed with me: There is a market for a truly premium, aspirational domestic sedan: a car that would make a statement about its owner when parked in the driveway beyond “I’m on my way to the airport,” “I sold the most lipstick in my neighborhood” or “My dad is visiting.”

Right now, in the $50k segment (considered core luxury, below the CTS/C-Class/3-series “near luxury” segment and below the S-Class/7-series “premium luxury” segment), the only choices are essentially middle-rung models from the Germans (E-Class, 5-series) and Japanese (Lexus GS, Infiniti M), plus some bit players from Great Britain, and the Cadillac STS, a nice car but not one that has the presence to match its price tag, which passes $65k with decent options and a V8. In fact, barring the XLR sports car, the Cadillac with the most presence is the Escalade, which shares a platform with a pickup truck.

With the success of the 300 making Chrysler a desirable brand once again, the business case for Imperial is actually quite good. A premium luxury sedan at a core luxury price. A car with genuine cachet, exquisite features and style, the best a brand can do, but within reach of upper-middle-class Americans. Kind of what a deVille was in the 1950s-70s, or what a Continental was in the 1960s. There simply isn’t such a car now. And if people are willing to pay more than $60k for a truck (Escalade) or for an STS, why not have an Imperial?

As for marketing versus engineering, I’ve never seen an engineer from Toyota or Japan present a new concept at Detroit, either. OK, once some Japanese engineer talked about spending six months road-tripping through the US to learn what people love in a minivan, and the result were the key new features in Toyota’s Sienna. Not one of those features was new... The rolldown windows in the sliding door? Mazda MPV. The little convex mirror to watch the kiddies? Ford Windstar. I don’t even remember the other non-innovations he spoke of. And the seats still don’t match the Chrysler Stow-n-Go for packaging brilliance. But the quality (forgetting the engine sludge problem that plagued the prior generation and was denied by Toyota for years or blamed on poor maintenance habits, which was real but uncharacteristic of Toyota) has not made Sienna overtake the Chrysler minivans, even though it’s arguably superior. Toyota is just as marketing-minded (Scion, anyone? Lexus?) as anyone, perhaps just less obvious about it. They just wouldn’t think of introducing a low-quality car (again, aside from that one sludgy mark on their record), nor do they reveal their marketing motivations so openly. It’s one reason some people see a Lexus ES as a fancy Camry but others happily see a Camry as an affordable Lexus. Toyota lets consumers and the press figure that out on their own.

The 300 has been quite a model of quality for Chrysler. No major recalls, no scandals, no newsmaking problems. And this with an all-new platform (sharing some suspension design from Mercedes, though it is not the previous E-Class platform, despite what some outlets have reported), a new transmission made in a new US plant (thankfully derived from MB, whose powertrains have never lost their reputation), and an engine they’re working overtime to crank out. It’s a good car! And with its style, performance, award winning and sales success, it might even be a great car. So why not aim even higher?

The challenge to me is very much one of marketing. Style and positioning are going to be critical. Getting dealer service to be commensurate with the price tag are is going to be huge (my Jeep dealer doesn’t give me 10% of the service quality or satisfaction on my $39,000 Grand Cherokee that I get from my Mercedes dealer on my lower-priced C-Class). But this is a hard one to pre-judge. The market may have to decide if they did those things right, especially styling. I personally think Chrysler design chief Trevor Creed has turned Jeep into a silly, ugly parody of itself (Does every Jeep have to look a Wrangler trying to be a Hummer? What’s with the garbage-man handles on the back of the Commander?), and the rest of the line, barring the 300 and Magnum (truck face and all) don’t have nearly the lust factor, IMHO, that Tom Gale and Bob Eaton brought us in the 90s (both the production models like the LHS, PT Cruiser and 99-05 Grand Cherokee to all those incredible concepts like the Chronos and Atlantic). So if it looks like the Imperial concept, Mark’s prophecy might come true. 

Then again, people bought an awful lot of Lincoln Navigators and gen-1 and -2 Escalades. Bombast sometimes sells, for a while.

Then again, gas wasn’t approaching $4/gallon then, and maybe someone figured out that Maybachs wouldn’t look any better at one third the price?

Who knows... But it will be interesting to see if they can pull it off. If not, remember that the ‘81-83 Imperial and ‘90-93 were not exactly loved by all, either, as much as we enjoy them, and yet the Imperial name apparently hasn’t been sullied beyond resurrection yet. Its time could come yet again.

As for me, I really liked what I saw on the Chrysler stand in Detroit this January. Right next to the Imperial, that is, in metallic orange... And the new Challenger will cost a fraction of what the originals go for! Doubt the Imperial will be able to pull that off, but maybe we’ll all feel super-smart if the value of ours starts to finally reflect their magnificence!

OK, enough for one night for me. It’ll be interesting to see where the new Imperial goes between now and production, if it reaches production... If not, $50k would buy me a very nice older one and maybe a garage to put it in! Or I could just do a Pebble Beach quality restoration of mine and wait for it to be invited there in another 30 years.

Chris in LA
67 Crown
78 NYB Salon


On 5/22/06 7:57 PM, Mark McDonald at tomswift@xxxxxxxxxxxxx wrote:

> This article came from the May 1st issue of "Automotive News:' 
>
>
> CHRYSLER LOOKS TO IMPERIAL TO GO UPSCALE 
>  
> Rick Kranz 
> rkranz@xxxxxxxxx 
>
> NEW YORK--  Chrysler executives believe Cadillac and Lincoln buyers are available for the taking.  Ditto for some buyers of the BMW 5 series. 
>
> And the car to woo them?  A premium sedan such as the luxurious Chrysler Imperial concept.  The Imperial would be positioned above the 300C, an upscale trim level of the 300 with a Hemi V-8. 
>
> Although the Imperial is a concept, the Chrysler group's Joe Eberhardt believes the automaker has enhanced the Chrysler brand to the point that it can credibly add a higher priced sedan such as the Imperial. 
>
> Eberhardt says it could be priced several notches above the 300C, whose sticker price starts at $34,400, including shipping.  "I do think a brand news to evolve, needs to be developed," says Ebergardt, Chrysler's executive vice president of global sales and marketing.  "It does take time.  With each successive product success, you get to notch it up a little more." 
>
> Eberhardt is mum on potential pricing for a premium sedan but says the brand is not ready for a car that starts at $50,000. 
>
> The automaker sold 144,068 Chrysler 300 sedans last year, about a third of which were 300C models.  First quarter sales of the 300 this year totaled 39,332 units, up 8.5 percent from the first quarter of 2005.  Sales were helped by modest customer or dealer incentives of up to $1,000 during 2005 and 2006.  But Eberhardt points to the 300's average transaction price as a measure of the car's and of the brand's real; success. 
>
> The average transaction price of all Chrysler 300 models, after rebates, in the first quarter of 2006 was $30,927, according to Power Information Network. The success of the car shows there is not necessarily a price ceiling" for the 300 or the Chrysler brand, says Eberhardt, interviewed at the New York Auto Show. 
>
> "We are selling it from $23,000 up to $43,000, $44,000 (and beyond), which shows we can very successfully spread a vehicle like the the 300 across $20,000 or so." 
>
> Jack Trout, president of Trout & Partners, a marketing strategy firm in Old Greenwich, Conn., says the 300's success gives the the automaker the opportunity to move the Chrysler brand upmarket.  "They have generated some excitement for the Chrysler line with the styling and the Hemi, so i think they have enough there to nudge it up," trout says.  But "I would be very nervous about getting too far into prestige land."  
>
> How much space could be placed between the base 300C and, say, the Imperial?  "I would say $5,000," says Jeff Schuster, executive director of global forecasting at J.D. Power and Associates.  He adds "$7,000 would be kind of capping it."  Such a sedan, Schuster says, would need to be a :unique Chrysler product and not get into Mercedes Benx territory." 
>
> Jim Sanfilippo, executive vice president of the consulting firm AMCI in Bloomfield Hills, Mich., says the automaker's plans to add a strecthed 300 model this fall show that Chrysler is already moving the brand a bit upmarket.  "Basically, they have confirmed their idea of going premium," Sanfilippo says. 
>
> Chrysler's Eberhardt says baby boomers would be the target for the Imperial. 
>
>
> MY THOUGHTS: 
>
> I see 3 things wrong in the new Imperial concept as presented above.   
>
> First, the seeds of the new Imperial's failure are contained in the very first paragraph, in which Chrysler executives are said to believe that a new Imperial can steal away Cadillac and Lincoln buyers-- and BMW buyers. 
>
> Nonsense!  I just spent a year selling Cadillacs (and Pontiacs and Nissans) and I can tell you that not once in that entire time did anyone in my dealership ever take a BMW in trade on a new Cadillac.  Not one.  New BMW buyers are simply not interested in Cadillacs or Lincolns-- period-- and they won't be interested in a new Imperial, either. 
>
> If Chrysler seriously believes this, that they can make a car that competes with BMW and Lincoln and Cadillac, then the new Imperial will be another in a long series of bastardized stepchildren like the Cadillac Catera-ble or the Lincoln LS-- cars whose schizophrenic natures are neither European enough to please a European nor American enough to please an American.  Folks, please decide what you want the Imperial to be before you make it.  It can either compete against the Cadillac and the Lincoln, OR the BMW, but not both. 
>
> 2.  If you step back and look at this article what you see is a perfect illustration of what is wrong with the American car industry right now, and a clear indicator of why we may not even have an American car industry in the next few years. 
>
> The reason is simple: American car makers are MARKETING DRIVEN. 
>
> The most successful carmakers in the world right now (Toyota, Honda, etc.) are ENGINEERING DRIVEN. 
>
> Doubt my word?  There are 4, count 'em, FOUR marketing executives quoted in this article.  There is not a single engineer quoted or even interviewed.  In other words, the very things that made Chrysler the brand it was in its heyday-- and the very thing that makes us remember the Imperial 50 years later-- engineering greatness-- is not even playing a role in the decison making process to build the Imperial.  It is all based on market based calculations and mumbo-jumbo. 
>
> Let me give you an example.  When Honda first came to this country they built only motorcycles.  Then they only built small, 2 door cars.  When, in the 1970's, they decided to venture out into the big world of 4 door sedans, their primary concern was not "How can we position this vehicle?" or "How much more can we ask for it?"  Their primary concern was "Can we build a good 4 door sedan?"  Because to the Japanese mentality to fail to build a good car is a far greater loss of face than to build a car and not see it sell well.  So they made damn sure from an engineering point of view that the car they built would be a great 4 door sedan. 
>
> By the way, the car they came out with was the Accord.  The rest is history. 
>
> Folks, American car buyers are drawn to and motivated by QUALITY.  When American car makers figure this out and stop worrying about which celebrity they can sign up to do their commercials, that is the day the American car industry will turn around. 
>
> 3.  Last, but not least, they say that the new Imperial will be targeted at Baby Boomers.  Well, I'm a Baby Boomer and I think it stinks.  If they want to sell it to Baby Boomers, they need to GET A BABY BOOMER TO DESIGN IT.  Right now, this car looks as if it was designed by a 28 year old for a 22 year old. 
>
> Just my opinion, 
> Mark McDonald