How FCA Plans to Shape the Future of the Minivan Segment
Rumor has it that Fiat Chrysler Automobiles (FCA) is reconsidering its two-minivan strategy as the Chrysler Pacifica leaves the Dodge Caravan in the dust in terms of sales figures. Whatever the automaker decides, it’ll be a big impact for the Windsor, Ontario assembly plant that currently employs over 6,000 employees on three different shifts. Canada’s Unifor Union is reporting that FCA plans to invest at least $350 million into the Windsor plant, retooling it for “future product,” but the automaker itself has yet to confirm what that product will be.
In March of 2019, Automotive News Canada reported that the retooling will take place over the Summer, prepping the assembly plant for the rumored all-wheel-drive Chrysler Pacifica minivan. Industry analyst Joe McCabe stated that FCA is not only going to assemble the all-wheel-drive Pacifica at the Windsor Plant, but the automaker is also planning to replace the existing Grand Caravan with an entry-level minivan – specifically one that’ll sport the Voyager nameplate. McCabe said that the new product will not be a crossover because FCA will not want to cede leadership in the minivan segment – a segment the automaker invented 35 years ago.
“One of the biggest risks for any manufacturer getting out of a segment is this idea of ‘lost to someone else.’ And right now, Chrysler being the leader in the segment, can’t risk to dilute themselves enough to the point where minivan buyers will look elsewhere,” said McCabe, the CEO of AutoForecast Solutions when speaking to Automotive News Canada.
Staying within the same segment would allow FCA to appeal to the same cost-conscious buyers that are interested in the Grand Caravan now. “They just can’t afford to risk that foothold that they have in the minivan space. I think there’s more of a risk in killing the Caravan and having only one Pacifica and having too many trim levels where they lose the high-end Caravan buyer to a higher-sized Pacifica. That’s where we see the risk. They have to make sure they backfill the more cost-conscientious Caravan buyer,” McCabe added. As is customary anFCA spokesperson declined to comment as the automaker does not frivolously unveil future plans unless at a specific event or vehicle unveiling.
Other industry insiders agree with McCabe’s assessment that a dual-minivan strategy is the right direction for FCA should the Grand Caravan finally be phased out. A lower-priced van would be important for dealers as Chrysler is likely to introduce rebates and other packages to attract prior Caravan customers. Should the Dodge Voyager replace the Grand Caravan, the Pacifica will be responsible for filling in the gaps as the market warms up to the entry-level minivan. Current trends indicate a decline in overall market interest in the minivan segment, but other rumors have circulated before that the ever-popular crossover segment is sure to play an integral part into the automaker’s success eventually.
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