Chrysler to Cut Models and Dealerships

Washington Post reports automaker Chrysler LLC is planning to cut its product lineup and reduce its number of dealerships as part of a plan to cut costs.

Chrysler currently has a product line-up of 30 different models of cars, trucks, and sport utility vehicles between the Chrysler, Dodge and Jeep brands, which it will be reducing to 15.

John Casesa, a former Wall Street analyst said, "This company needs to eliminate waste that goes with having duplicate products in each (brand) channel and smaller stores with low profitability."

According to the Washington Post, the automaker may face difficulties in its plans to downsize its dealership network due to laws from the states that are designed to protect those businesses. Analysts say that Chrysler will most likely have to offer financial incentives to really make progress decreasing its current 3,600 dealerships.

"A smaller dealer base will translate into more attention for Chrysler's cars and stronger advertising," Casesa added.

Chrysler Vice Chairman Jim Press said, "In the end, we will have a more viable dealer body focused on the customer."