Chrysler To Offer Some Diesel SUV And Hybrid Pickup In 2003-04 – Chrysler Corp

Chrysler To Offer Some Diesel SUV And Hybrid Pickup In 2003-04 – Chrysler Corp – Brief Article

Chrysler said it will offer a gasoline-electric hybrid pickup truck next year and a diesel-powered sport utility vehicle in 2004, in a bid to test consumers’ willingness to pay for better fuel economy. But Chrysler said it had canceled another hybrid vehicle that had been planned for 2003 because it could not build a business case for it.

Chrysler executives warned that hybrid- and diesel-powered models would not be built in significant volume unless U.S. customers accept their higher costs.

Chrysler President Dieter Zetsche said Chrysler would sell a Jeep Liberty SUV powered by a Mercedes diesel engine in the second half of 2004 that will have up to 30 percent better fuel economy than a gasoline-powered model. Zetsche said

Chrysler said it will build about 5,000 diesel Liberty models to see how well American consumers accept diesels. Chrysler already sells diesel-powered Jeeps in Europe, but has to tweak the Liberty slightly to meet U.S. standards.

“This diesel Liberty is an opportunity to test customer acceptance of modern, clean-burning diesel technology,” Zetsche said during a conference in New York.

In Europe, diesels account for roughly 40 percent of all new vehicle sales, thanks to tax incentives and low-sulfur diesel fuel, which allows automakers to better control emissions. The U.S. Environmental Protection Agency has ordered U.S. oil refiners to begin producing low-sulfur diesel fuel in 2006, a regulation oil companies have been fighting.

Chrysler research found that only about 6 percent of buyers were interested in diesels. Zetsche also said Chrysler would not be able to raise the Liberty’s prices to cover all the extra cost of the diesel. “Obviously, to change the image of diesels in the customer’s mind is a heroic challenge, and we don’t know what is possible,” Zetsche said. “We hope we’ll have a positive surprise about the demand.”

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