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Tuesday, July 20, 2010

The Meteoric Rise and Catastrophic Fall of the PT Cruiser


2005 Chrysler PT Cruiser

2005 Chrysler PT Cruiser

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On Friday, the very last Chrysler PT Cruiser rolled off the assembly line in Mexico. To say that the last PT Cruiser marked the end of an icon would be a total understatement. The retro model’s life began a decade ago and was an instant hit, helping Chrysler rack up sales as high as 144,717 units in 2001 alone. A decade later, the PT Cruiser is very much a like a time capsule; having undergone only minor changes since its introduction, it has become a relic of everything that went wrong with Chrysler.

In the beginning…

Amid the bland Honda Civics and the conservative Toyota Camrys that dominated the compact and midsize sedan segments, Chrysler became a trendsetter with the launch of the PT Cruiser. The Cruiser’s flared fenders, sloping hood, and five-door body style mimicked the old sedans and panel trucks of the 1930s and 1940s. Its distinctive look even inspired a slew of other "retro" styled creations. But the eye-catching PT Cruiser and its immediate success didn’t just lead to imitators such as the Chevrolet HHR, instead it arguably spawned an entire movement of retro vehicles, like the latest generation Ford Mustang and Chevrolet Camaro.

Although the Chrysler PT Cruiser did appeal to an older demographic that remembered the vehicles from which the Cruiser’s styling was essentially borrowing from, its success was attributed to the fact that consumers of every demographic, young and old, seemed to be mesmerized by the car. Aside from its looks, the PT Cruiser was also roomy, versatile, and affordable, which helped make this car a great all-around value.

Then things went wrong

The initial success of the PT Cruiser was staggering, and many dealers were perpetually running out inventory. Over the years Chrysler decided to offer consumers more choices, eventually adding a convertible, with some new paint colors to choose from. Concepts of two-door and panel van versions were also built, but never reached production.

Unfortunately for the PT Cruiser, few other significant changes were introduced as the years went on. No major redesign or styling update was done, which caused the once trendsetting Cruiser to become dated and tired. Sales began to reflect that it was simply falling behind the times. From its high of 144,717 in 2001, the PT Cruiser sold just over 50,000 in 2008, and only 17,941 last year.

As the car withered away from abandonment, Chrysler was also struggling with larger problems. Resources began to dry up and product life-cycles lengthened. Eventually, the automaker’s troubled nine-year partnership with Daimler AG ended and in 2007 Chrysler was sold to private equity firm Cerberus Capital Management. With new ownership, the outlook at Chrysler didn’t improve much and the company fell into bankruptcy last year.

The chopping block

After Chrysler emerged from bankruptcy, Italian automaker Fiat Group SpA took the helm of the company and vowed to revamp Chrysler aging lineup; much of which had been criticized for dismal quality and poor efficiency.

It didn’t take long for Fiat to axe the PT Cruiser from the lineup, in part to make room for the U.S. launch of the Fiat 500. Slated to be built on the same assembly line as the PT Cruiser, the 500 is small, ultra fuel-efficient, and boasts fresh European styling. Despite being a very different car than the PT Cruiser, it’s also hoped that the 500 will make the same splash that the Cruiser did. Only this time, the automaker is no doubt hoping to sustain its popularity a little longer

Compounding problems

Because the PT Cruiser was so quintessentially American, it never stood a chance for substantial sales outside of the U.S. These days, due to economic constraints, automakers like Ford are building more global products, such as the Fiesta, which are designed to appeal to as many markets possible, and not just a select few.

With Chrysler producing so many PT Cruisers over the years - without any major redesign - the car became old just as quickly as it became a sensation. As it aged rather ungracefully sales steadily dwindled to a low of just 4,917 units this year through the end of June.

Despite the ill-fated position the PT Cruiser found itself in, it did prove to be a sales powerhouse for Chrysler - at least for a while. For those that still have an affinity for the beleaguered Detroit automaker, let’s hope that the meteoric rise and catastrophic fall of the PT Cruiser serves as a valuable lesson for Chrysler and for the upcoming 500.

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