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Thursday, September 06, 2007


The Toyota-ization of Chrysler Group

Ever since Bob Nardelli took over, the auto world has been wondering how he will "fix" Chrysler. The two most visible moves? Hiring Toyota sales and marketing executives seems to be the answer.

Let me be the first to say, I'm not sure that this fully addresses Chrysler's need. I know both Jim Press (new co-President) and Deborah Wahl-Meyer (new CMO) are very talented sales and marketing executives. But is that really Chrysler's problem? My $.02 says Chrysler's biggest issues are in engineering and product planning, not sales and marketing. Here's the situation as I see it:

Given those challenges, it seems that Chrysler should want to hire some Toyota product planners, engineers and manufacturing people to help the sales/marketing execs. I suspect it's a bit harder to lure them away...the NUMMI people (manufacturing JV with Toyota to make Corollas and Geos...remember Geo???) at GM didn't fare well even though they demonstrated that a Big 3 plan could rival Japanese quality/productivity.

The challenges at Chrysler will be much different than at Toyota/Lexus during the go-go 90s. The Lexus product and launch was practically flawless from a product standpoint. Fantastic V8 and fit/finish with industry standard dealer support...the chance to get it all right the first time...with a management team in Japan that said, "do whatever it takes to become the leader." The Toyota Camry is the gold standard for Sedans...and it's not because of its styling or advertising. It runs like a refrigerator. If you can get the product right...everything gets so much easier. Jim Press was quoted as saying he thinks he can strengthen the dealer group...I don't know...but my guess is that Toyota's dealers are strong because they sell more new units/store than any other franchise in the US...and that's because of products like the Camry, Corolla, Tercel, Prius and Sienna. To me at least, Toyota is an engineering and manufacturing company first and a sales/marketing company second. That explains their success.

As a friend of mine from J. Walter Thompson used to say...there's no amount of advertising/marketing creative and media that will save the Ford Tempo.

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