2014 Ram 1500 Tradesman on 2040-cars

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FCA is setting a five-year strategy: Here's how the last one played out

We're slightly more than four years removed from Sergio Marchionne last five-year plan for FCA, a tell-all where the Italian-American automaker divulged its plans for the 2014 through 2018 model years. It was a grand affair, where Sergio told FCA investors that all was right in Auburn Hills, Alfa Romeo and Maserati were making comebacks, and the fifth-gen Dodge Viper received a mid-cycle refresh. You can read every last one of those past predictions right here. We're on our way to Europe to see Sergio's sequel, coming out Friday straight from FCA's Italian headquarters. (Bloomberg reports a plan to expand Jeep and Ram globally, combine Alfa Romeo and Maserati into a single division for an eventual spinoff, and downsizing Fiat and Chrysler. Also, EVs.) But before we arrive in Italy and find out exactly what Marchionne has planned for 2019 through 2023 as his last act as CEO, let's take a minute to tally up the results of his last term based on the same scoresheet we used in 2014. Now, we're only five months into 2018, so much of this — including vehicles like the Ram HD and Jeep Grand Wagoneer — could still debut this year. For those, we'll mark things TBD. We're not going to draw any conclusions or make any objectionable remarks. We're simply going to let the stats speak for themselves.

Fiat Chrysler dumped 40,000 unordered vehicles on dealers

In a move that echoes recent history, Fiat Chrysler has been making more cars and trucks than dealers in the U.S. are willing to accept, with Bloomberg reporting that at one point the automaker had built up a glut of around 40,000 unordered vehicles. That’s led some dealers to accuse FCA of reviving the dreaded “sales bank” accounting practice of obscuring inventory to improve the balance sheet. The company reportedly began building up its inventory of unordered cars this summer despite an industrywide slowdown in sales and an eagerness by some dealers to thin their inventories because rising interest rates are making it more expensive to hold unsold cars. The inventory build-up also coincided with Fiat ChryslerÂ’s efforts to find a merger partner, first with Renault, which fell through, then last monthÂ’s announcement that it will merge with FranceÂ’s PSA Group. FCA denies any such scheme and tells Bloomberg the rising inventory is down to a new predictive analytics system designed to better square supply with demand from dealers that is helping the company save money and narrow the numbers of unsold vehicles. The company recently agreed to pay a $40 million civil penalty to the U.S. Securities and Exchange Commission to settle a complaint that it paid dealers to report fake sales figures over a span of five years. While no one is suggesting that FCA is in dire financial straits — the company saw higher than expected earnings in the third quarter and record profits in North America — the practice has strong historical precedent by Chrysler, which built up bloated inventories in the run-up to its two federal bailouts, in 1980 and 2009. It was also common at GM and Ford during the 2000s, when all three Detroit automakers struggled with excess manufacturing capacity and plummeting sales in the lead-up to the Great Recession. Back in 2012, CFO Magazine wrote about a report that explained automakersÂ’ rationale for the practice and how it works: Say fixed costs for a given factory are $100, and that the factory can make 50 cars. Consumers, however, demand only 10. Under absorption costing, if the company makes all 50 cars, its cost-per-car is $2. If it makes only up to demand, or 10 cars, the cost-per-car is $10. Although each car adds variable costs for steel and other parts, if those costs are low, the company still has an incentive to make more cars to keep the cost-per-car down.

FCA Drive for Design Ram truck contest winners chosen

Last month, Fiat Chrysler held a 24-hour sketch battle open to anyone in the world willing to design the "wickedest and most outrageous" version of a Ram truck. That flash contest was a sideshow to the main event, FCA's annual Drive for Design competition open to high schoolers in the 10th, 11th, and 12th grades who were this year asked to design a Ram pickup for the future. The automaker's design team judged the entries, led by Ram Truck and Mopar Exterior Design boss Mark Trostle, with outside input from Detroit sculptor Josh Welton. The contest closed on May 1, and the winners have been decided: Job Skandera, a 12th grader from Santa Clara, California took first place with his Ram Magma; Vincent Piaskowski, an 11th grader from Birmingham, Michigan (home of Autoblog's headquarters) earned second place with an electric Ram; third place went to the Ram 1500 Series A by 11th grader Alex David Kirschmann from Auburn Hills, Michigan. Kirschmann clearly has a knack for this since he earned second place in last year's Drive for Design competition. The Ram Magma's name is suggested by the translucent polycarbonate windows that forego traditional tinting for a crystalline red privacy sheen "inspired by volcanic igneous rock." The Magma also showcases multiple light bars stretched across the roof, a UV water purifier system between the cab and bed, and a stove embedded into the tailgate. Thankfully, the feature set includes an adjustable suspension that lowers the cab to mortal levels of ingress. The electric Ram protects its extremities with a lightweight graphene hardcoat, offers side storage outside the bed, more storage under the bed floor, a heavy duty power station tucked into the bed wall, and the sandwiched tailgate can form a two-tier shelf system for organization on the job site. That tailgate gives us some real ideas. The 1500 Series A is Judge Dredd's truck when he leaves his Lawmaster motorcycle at the office. The RamBox storage compartments and retractable tonneau cover would represent sentimental historical touches when he's running errands — and moving everyone out of his way — in Mega-City One. Due to social distancing, the traditional awards ceremony and visit to FCA design HQ to talk with team members had to be canceled.