Why the 707-Horsepower Dodge Hellcat Is Key to Fiat Chrysler’s Plan – Motley Fool

Posted: Monday, July 21, 2014

Tire smoke has been a recurring theme in Chrysler’s efforts to market the new Dodge Challenger SRT Hellcat — and the remaking of the Dodge brand itself. Source: Fiat Chrysler

Need a break? Here’s a video of a lime-green muscle car doing a smoky burnout.

It’s either harmless fun or a bit obnoxious, depending on your point of view. But what does this have to do with business and investing?

If you’re at all interested in the business of cars, this video is worth some thought. There’s much more going on here than a car smoking its tires in front of a crowd.

In fact, this is almost certainly a carefully planned marketing exercise for Fiat Chrysler‘s (NASDAQOTH: FIATY  ) Dodge brand, part of a surprising campaign that has the automotive world buzzing.

That’s not just some guy in a Challenger, it’s a Chrysler exec
First, some context. 

This video was shot last weekend at the “Carlisle Chrysler Nationals”, a huge gathering of fans of Chrysler-made vehicles new and old that happens every year in Carlisle, Pa. 

As usual, Chrysler had a contingent of its own on hand at the show. The car in this video is a pre-production 2015 Dodge Challenger SRT Hellcat, the new 707-horsepower monster that has had the automotive world abuzz for the last several weeks. 

But what’s interesting to us is that the car is being driven by Chrysler senior vice president Ralph Gilles. Gilles wears a couple of hats at Chrysler: He’s not only the company’s chief designer, he’s also CEO of its motorsports unit.

Chrysler executive Ralph Gilles poses with a Dodge Viper in this official photo. Source: Fiat Chrysler

He’s a big deal, in other words, a key member of Chrysler’s top brass. But here he is at an enthusiast event doing a ridiculous burnout for the crowd and having a lot of silly fun.

Gilles is from all reports a genuine high-performance car enthusiast and a great ambassador to the company’s most passionate fans, so I don’t think this is an example of an executive going off the rails. Whether this was a spontaneous bit of fun on Gilles’ part, or a carefully planned exercise, I think it’s another piece in an interesting campaign to relaunch and revitalize the 100-year-old Dodge brand.

A successful campaign for car and brand
Back in May, in a full-day presentation for analysts and media, Fiat Chrysler revealed its five-year business plan. That plan has a lot of moving parts — essentially, it’s the road map for the integration of newly merged Fiat and Chrysler and its transformation into a thriving global automaker.

One part of that plan involves retooling the old Dodge brand as a high-performance brand aimed (at least in part) at drawing younger buyers into Chrysler showrooms.

How will they go about doing that? Well, some of the plan relies on new products that won’t appear for a few years. But in the short term, Chrysler has been making some very interesting noise with the quasi-viral campaign for its new 707-horsepower Dodge Challenger SRT Hellcat.

Bit by bit, Chrysler has been releasing information. First we got photos, and the basic details on the car. Over the next few weeks, third-party videos featuring the car started to appear on YouTube: Hellcat sightings in traffic around Detroit; Dodge CEO Tim Kuniskis revving a Hellcat for a crowd of journalists; other little snippets that played up the car’s dramatic exhaust note.

Then Chrysler itself got in on the YouTube act, with a short video announcing the car’s horsepower ratings, and another showing it winning a drag race against a classic 1971 Challenger.

And now? Ralph Gilles doing burnouts for a crowd. 

How to make a lot of (marketing) noise with a small budget
There’s surely more to come: At some point soon, Chrysler will reveal the car’s price, and then we’ll have driving impressions from automotive journalists, and perhaps a few other surprises, right up to the moment when the first Hellcats start arriving at dealers this fall.

But as I said the other day, the point of this campaign isn’t just to sell the Hellcat, a car that is unlikely to sell more than five or six thousand copies in a year. 

It’s about selling the new version of the Dodge brand — on what is surely a very tight budget, as cash-strapped Fiat Chrysler hustles to finish development of a slew of new products around the world.

From here, it looks like a smart approach. And while it has a long way to go, Chrysler has to be pleased with how things are going so far.


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