Chrysler Relies On Fleet Sales To Post Impressive 2012 Figures
Chrysler's sales success story in Canada has been a headline-maker for the past three months, with the brand dominating overall vehicles sales across the country in 2013. A recent report from Desrosiers Automotive Consultants sheds a little bit of light on how Chrysler has been able to post such impressive numbers.
The report reveals that for the 2012 model year almost half of all Dodge vehicle sales - and close to 45% of Chrysler sales - were made to fleet buyers, That means that for every one Chrysler or Dodge that went out the door to a private party, another was shipped off to a rental fleet or a corporate customer. For comparison, roughly 3% of Honda sales in 2012 were made to fleet buyers.
Why, exactly, does it matter who Chrysler is selling its cars to? Isn't a fleet customer as good as a retail customer? Yes, and no. Margins on fleet cars are typically lower than those sold in dealerships due to the fact that they often come with fewer options or even stripped-down feature sets to make them more affordable when purchased in great volumes. Furthermore, fleet sales offer companies the chance to shift unpopular models - such as the Dodge Caliber - to rental operations that aren't concerned with long-term value. General Motors was for many years notorious for dumping unpopular, low-spec sedans onto the fleet market in order to bolster its sales numbers - a strategy that has evolved in 2013 to offering last year's Chevrolet Impala to rental companies even while it offers an all-new 2014 Chevrolet Impala to private customers.
Ultimately, Chrysler would love for its retail figures to take up a larger slice of its overall sales pie. Reversing the current trend will require the brand to continue with its strategy of introducing new, more advanced passenger cars to keep up with its enticing array of trucks and SUVs.
