Chrysler to Re-enter Van Market

The rebounding commercial van market will have to make room for a new/old player. Chrysler Group LLC announced it plans to import the Fiat Ducato and the smaller Fiat Doblo. The vans will be put under the Ram brand and given new names. Chrysler has been out of the commercial van market since it's divorce with German car maker Daimler. The former Chrysler Sprinter was picked up by Mercedes, leaving Chrysler empty handed.

March 5, The Detroit News

The automaker will use its partnership with Fiat SpA to bring a pair of Italian commercial vans, the Ducato and the smaller Doblo, to North America next year to compete in a segment that is rebounding as businesses start spending again.

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The plan is to introduce the two vans under the Ram brand next year as 2013 models, said Fred Diaz, Ram president.

The question is: why now? The commercial van is slowly rebounding with 218,170 sales in 2010. However, the numbers are still far below the average of 325,000 annually until 2007. Currently, the market is dominated by General Motors and Ford. The two sell 95% of the commercial vans in North America. Perhaps Chrysler actually recognizes the elephant in the room the rest of the Auto Industry and most of the American public ignores: gas prices will go up. Believe it or not, Michigan Senator Carl Levin recently argued for reducing fuel efficiency standards.

The civil unrest in oil producing Arab states has already spiked fuel prices. Libya produces only 2% of the world's oil supply. Imagine what might happen if Saudi Arabia, another autocratic regime supported by the United States, experiences political upheaval. It's possible $5 a gallon gas will become the standard.

Even if nothing happens in these oil producing states, the future is inevitable. Oil prices will steadily increase over the next decades. The growing populations, and the emerging new middle class of India and China will drastically increase the demand. There's a reason why GM and Ford are investing heavily in China.


The most fuel efficient vehicles and the automakers who produce them will be the winners. Perhaps, Chrysler with it's partnership Fiat realizes this. Fiat has a history of producing smaller, less thirsty vehicles. Maybe these commercial vans will get slightly better gas mileage. And for a business purchasing a commercial van in a volatile oil market, fuel efficiency in the long term will become the deciding factor.