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Chrysler to Decide Soon on PT Cruiser Expansion

by Staff
January 17, 2001
2 min to read


Chrysler will make a final decision in two weeks whether to expand production of its g PT Cruiser combination car-truck vehicle to a third plant, Chrysler President Dieter Zetsche said. Chrysler builds the Chrysler PT Cruiser at its Toluca, Mexico, plant and is adding a small level of production at its Graz, Austria, facility. There have been reports the automaker has looked at Graz, as well as plants in Belvidere, IL, and Toledo, OH, to expand production of the vehicle. The PT Cruiser, with its 1930s gangster getaway car styling, has been a hit for Chrysler with con-sumers. It has helped buoy financial results at the U.S. automaker, which is expected to lose about $1.25 billion in the fourth quarter after a $512 million third-quarter loss. Zetsche said Chrysler officials have been studying the question of expanding PT Cruiser for the last 10 weeks, and four or five alternatives are being studied. He declined to provide further details. Chrysler’s annual capacity for the vehicle will hit 230,000 this summer after Graz is fully up and running, but demand worldwide is higher. Zetsche said that Chrysler officials have decided how they would change the vehicle over the next several years to maintain its popularity, taking an approach much like Germany’s Volkswagen AG has taken with its New Beetle. He declined to provide details. Analysts expect a turbocharged ver-sion of the PT Cruiser, as well as a panel van model. Zetsche said he is not concerned about shutting down North American assembly plants because of a lack of parts from suppliers upset over the cost cuts that have been demanded from them. Chrys-ler’s suppliers were expected to cut prices by 5 percent on Jan. 1. However, some suppliers, through their industry trade group, have expressed reservations and there have been reports of some threat-ening to cut off supplies of parts. That could lead to shortages at Chrysler plants that don’t keep sup-plies stored for such possibilities. He also dismissed reports DaimlerChrysler’s two largest shareholders – Germany’s Deutsche Bank and the state of Kuwait – were losing patience and had given DaimlerChrysler Chairman Juer-gen Schrempp six months to turn around Chrysler or break up the company.

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