George S. May Business Blog

Chrysler reveals its new Jeep Grand Cherokee despite White House “recommendations”

Despite the tongue-lashing that Chrysler received from the White House for having a product line-up with too many trucks and SUVs, the car make unveiled its only new product at the New York auto show, a redesigned Jeep Grand Cherokee.

Chrysler insists the SUV, which clocks in at 20 mpg in its two-wheel-drive version and 19 in four-wheel-drive, is a crowd favorite and a crucial part of its lineup.

“This is a very important vehicle for us. It’s one of the primary legs of the Chrysler stool,” Chrysler spokesman Rick Deneau said. “Customers have told us they want this vehicle and that it’s the right size.”

In Chrysler’s defense, their 2011 model is said to be 11 percent more fuel efficient. It is also powered by a cleaner and more powerful engine

I can understand, when looking at the statistics, why Chrysler would stand by the Grand Cherokee. It’s the number two seller in their entire lineup! But, nonetheless, timing is everything. A week after getting all but a direct order to discontinue the development of new trucks, Chrysler decides to do the opposite. Some of the gentlemen on Capitol Hill may not take this too lightly.

Chrysler is currently on the clock, so to speak, as the Obama administration rejected the carmakers proposed survival plan and, in short, told Chrysler that in order for them to receive any more federal aid they would have merge with the Italian carmaker, Fiat, in 30 days. Chrysler absolutely needs the government funding to stay afloat, so a merger between the two is likely. Chrysler Jim Press asserted that Chrysler was working “24 hours a day” to reach a deal, and “at this point in time with Fiat, we don’t see anything that would be an impasse or a deal breaker.”

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