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Why Chrysler made the Pacifica Hybrid

There were a number of important details missing from Chrysler's debut of the Pacifica Hybrid yesterday. Pricing and availability, for example. We still don't know those specifics – Chrysler just says it will all be announced closer to launch – but we spent some time with Kevin Mets, the chief engineer for the Pacifica Hybrid, to learn more about the powertrain and why Chrysler decided to offer this vehicle at this time. "This could be a primary electric vehicle for someone." We started with the big question: why build a plug-in minivan at all? "It brings the ability that if you want an electric vehicle, a hybrid, you don't have to compromise size to get there," Mets said. "For instance just a few minutes ago I was talking to someone from Canada and they were saying in the US it's two vehicles per household is kind of the norm. In Canada it's not that way, it's more like a vehicle or even less than a vehicle. There's a lot of people that want an electrical vehicle in Canada but they can't make it their primary vehicle. This is a vehicle that could be a primary electric vehicle for someone in Canada, or anybody else for that matter, who wants a plug-in vehicle, an electric vehicle that doesn't have to compromise in size." So, was the development of the Pacifica PHEV influenced more by customers saying they wanted a plug-in hybrid minivan or was it driven more by green vehicle regulations? "That's a tough one to answer," Mets said. "Certainly you have to meet all the requirements. There's a little bit of everything there. You also can pick what vehicles you want to do it on. You pick which vehicle is the best opportunity and this is the one we chose. It's a little bit of both." As for when the Pacifica Hybrid will reach dealerships, all we know is, "late 2016." But Mets said that the minivan will at some point be available in all 50 states. Initial availability might be limited to places like California, but, "The idea is to sell it nationwide," he said. Chrysler decided on the "Pacifica Hybrid" name instead of the more-accurate "Pacifica Plug-In Hybrid" for simplicity. Anyone who might care that the minivan plugs in will find out that it, indeed, has a plug, the reasoning goes, but when Chrysler talks to the average mass market shopper, "hybrid" tells them everything they need to know. Under the hood (and the floorboards, where the batteries are) there are a lot of new bits.

Analysts wary over FCA lawsuit but say emissions not as bad as VW

MILAN - Any potential fines Fiat Chrysler (FCA) may need to pay to settle a US civil lawsuit over diesel emissions will unlikely top $1 billion, analysts said, adding the case appeared less serious than at larger rival Volkswagen. The US government filed a civil lawsuit on Tuesday accusing FCA of illegally using software to bypass emission controls in 104,000 vehicles sold since 2014, which it said led to higher than allowable levels of nitrogen oxide (NOx) that are blamed for respiratory illnesses. FCA's shares dropped 16 percent in January when the U.S. Environmental Protection Agency (EPA) first raised the accusations, adding the carmaker could face a maximum fine of about $4.6 billion. The stock has been under pressure since. Volkswagen agreed to spend up to $25 billion in the United States to address claims from owners, environmental regulators, U.S. states and dealers. FCA, which sits on net debt of 5.1 billion euros ($5.70 billion), lacks VW's cash pile but analysts said its case looked much less severe. While VW admitted to intentionally cheating, Fiat Chrysler denies any wrongdoing. Authorities will have to prove that FCA's software constitutes a so-called "defeat device" and that it was fitted in the vehicles purposefully to bypass emission controls. Even if found guilty, the number of FCA vehicles targeted by the lawsuit is less than a fifth of those in the VW case. Applying calculations used in the German settlement, analysts estimate potential civil and criminal charges for Fiat Chrysler of around $800 million at most. Barclays has already cut its target price on the stock to take such a figure into account. Analysts also noted that FCA's vehicles are equipped with selective catalytic reduction (SCR) systems for cutting NOx emissions, so it is likely that any problem could be fixed through a software update. "Should this be the case, we estimate a total cost per vehicle of not more than around $100, i.e. around $10 million in aggregate," Evercore ISI analyst George Galliers said in a note. The estimates exclude any additional investments FCA may be asked to make in zero emissions vehicles infrastructure and awareness as was the case with VW. FCA said last week it would update the software in the vehicles in question, hoping it would alleviate the regulators' concern, but analysts said it may have been too little too late. The carmaker is also facing accusations over its diesel emissions in Europe.

FCA chairman confirms Marchionne email to Barra

FCA CEO Sergio Marchionne is apparently backing up his talk about the need for consolidation in the auto industry with quite a bit of action. One recent report claimed that he even emailed General Motors CEO Mary Barra to make a deal. FCA chairman John Elkann has now confirmed that the correspondence actually happened, and that it wasn't a one-off occurrence. "It was not the only email, it was not the only conversation," Elkann (pictured above with Marchionne) said, according to Reuters. He is a member of the Agnelli family that has a controlling stake in FCA's stock and is supporting the idea of a merger. The automaker is willing to "act with determination if there are the prerequisites to do something that makes sense," Elkann said. Marchionne has been pushing for industry consolidation for months. While GM has been the main target of late, Ford was also rumored as a partner under consideration. In the past, there have also been reports of FCA negotiating with Volkswagen Group and PSA Peugeot Citroen for mergers, as well. According to Reuters, part of the reason for all of this effort might be as a way for Marchionne to ensure his legacy, though he's denied that. He's reportedly considering retiring after 2018. In his opinion, consolidation is needed because automakers are investing too much money to achieve the same goals. The situation would be better after mergers, and he predicts something to happen before 2018. Related Video: News Source: ReutersImage Credit: Massimo Pinca / AP Photo Earnings/Financials Chrysler Fiat Sergio Marchionne FCA merger John Elkann