August 24, 2012 / 4:07 AM / 5 years ago

Chrysler's Ram 1500 pickup truck relying on fuel economy, price

(Reuters) - Chrysler Group LLC is betting that better fuel economy and a moderate 1 percent increase in price from last year’s models will help its line of 2013 Ram 1500 pickup trucks gain ground on industry leaders from Ford and Chevrolet.

The first redesign since 2009 for the biggest-selling vehicle in the Chrysler lineup has led to a pickup truck with more technology and less weight to go along with the usual pickup truck marketing features of power and towing ability, analysts who have driven the new Ram 1500 said.

The Ram 1500 goes on sale in the United States in October.

The starting price will be $23,585, including destination charges, Chrysler said on Friday. The highest-priced version in the Ram 1500 lineup will be a four-wheel-drive “Laramie Longhorn” crew cab at $48,415, including destination charges.

Chrysler, majority-owned by Italy’s Fiat SpA FIA.MI, won’t be able to topple the top-selling Ford Motor Co (F.N) F-150 or the No. 2 General Motors Co (GM.N) Chevrolet Silverado in U.S. sales, but this improved Ram offering may narrow the gap, said analysts.

Edmunds.com director of vehicle testing, Dan Edmunds, said the Ram 1500, even an improved offering, faces an uphill battle against Ford and GM because pickup truck customers have fierce brand loyalty.

“There’s definitely some technical benefits and there’s some real benefits to the customer,” Edmunds said. “They’ve got a good solid product here. The question is - does it overcome years of brand loyalty? That’s hard to say.”

Sales of the current 2012 versions of the Ram pickup trucks rose 23 percent this year through July in the United States, U.S. market, compared with a 12 percent rise for Ford F-Series pickup sales and a 3.5 percent gain for the Silverado pickups.

Still, Ford’s pickup trucks made up 39.5 percent of the lucrative U.S. full-size pickup truck market, followed by 34.7 percent for GM’s versions including the Silverado and the GMC Sierra, and 18.3 percent for Ram pickup trucks.

The GM total combines a 25.2-percent full-size pickup truck share of the Silverado and the 9.5 percent share of the Sierra.

The Ram 1500 ”is not going to be a class leader in terms of sales volumes and Chrysler knows that,“ said Aaron Bragman, autos analyst with IHS Automotive. ”They don’t even have the capacity to do that. What they are is an alternative.

“Chrysler’s goal is not to have a segment leader. It’s goal is to make quite a bit of money, as all pickups do, and it does that quite well,” said Bragman.

Pickup trucks have wider profit margins than do smaller vehicles, which makes the Ram 1500 an important product for Chrysler. Without Chrysler’s profits, almost all from North America, parent Fiat would have shown a loss in the second quarter.

FUEL ECONOMY

Fuel economy, because of higher gasoline prices, has become a bigger factor for consumers when selecting a pickup truck in the past few years, said Bob Hegbloom, director of Ram Trucks for Chrysler.

So the Ram Truck brand and Chrysler will emphasize the version with a 3.6-liter, V6 engine and 8-speed automatic transmission that can get 17 miles per gallon of gasoline in the city and 25 mpg on the highway, Hegbloom said, citing estimates by the U.S. Environmental Protection Agency.

The primary model of the Ram 1500 lineup, the 4.7-liter with a V8 engine and a 6-speed automatic will get 14 mpg in the city and 20 mpg on the highway.

The 3.6-liter version of the Ram 1500 with the 8-speed transmission will surpass the upcoming 2013 Ford F-150 pickup truck with a 3.7-liter V6 engine, which gets 17 mpg in the city and 23 mpg on the highway, according to Ford.

GM’s 2013 Chevrolet Silverado has a version of that truck with a 5.3-liter, V8 engine that can get 15 mpg in the city and 22 mpg on the highway.

(Corrects market share figures for U.S. full-size truck market in ninth and 10th paragraphs)

Additional reporting by Deepa Seetharman in Detroit and Ian Geoghegan

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