Chrysler And Nissan Alliance: I Think It's Going To Work
There are hook-ups that work, and hook-ups that don't. In the car business, there are many that fail to live up to their promise. Which has many people wondering if the partnership formed between Chrysler and Nissan will pay off for both companies. I think it will. In fact, it's a smart move for both companies.
The deal is pretty straight forward. Nissan will build a small car that will be badged and sold under the Chrysler name. In exchange, Chrysler will build a full size pick-up that will be badged and sold under the Nissan name. For both companies it could be a double winner, allowing them to use excess capacity while plugging a weak link in their line-ups.
I know, I know. Some of you are gonna look at this and say, "Instead of building these vehicles for each other, why don't these guys invest the money into doing a better job in areas where they are struggling?" In theory, that makes sense. In reality, that could wind up being a costlier move.
Think about it, Nissan's pick-up work continues to lag the competition, despite a major commitment to the titan over the last six years. That's not a knock on Nissan. Doing trucks that can compete with Big 3 ain't easy.
As for Chrysler, the automaker has struggled for some time with small cars. It could make another run at doing it better, but the automaker needs to improve as quickly as possible, and hooking up with Nissan is one way to do that.
It will be a few years until we see these "alliance" models hit showrooms. But when they do, I think it will be a win-win situation for both companies.
Questions? Comments? BehindTheWheel@cnbc.com