Once a fading third-place nameplate that lacked the features and technology to compete effectively with larger truck brands, the Ram division of Fiat Chrysler Automobiles is making a run at rivals Ford and General Motors.
Ram quietly snagged 6 full percentage points of share in the pickup truck market between 2010 and last year, eating into Ford’s dominance of the market but also taking slices from Nissan, Toyota and GM.
It now controls 21 percent of the full-size pickup business, according to Autodata Corp., an industry research firm.
“Ram has carved out a unique place in the pickup segment by breaking the mold of what a truck should offer,” said Dave Sullivan, manager of product analysis at consulting firm AutoPacific Inc. “That has resonated with consumers.”
It is a dramatic recovery from stumbles made during a series of ownership and management changes that ended in the Chapter 11 bankruptcy of Ram owner Chrysler in 2009 and its subsequent merger with Italy’s Fiat to form FCA Group, the seventh-largest global automaker.
Much of the gain comes from paying better attention to what consumers want, Robert Hegbloom, president of the Ram truck brand, told Trucks.com.
The first move was to separate the truck division from Chrylser’s Dodge nameplate in 2009.
“That allowed us to focus on our product and marketing more directly to customers,” Hegbloom said.
Tailwinds from the resurgent auto market — Americans purchased a record 17.5 million vehicles last year — and falling fuel prices also have powered Ram’s gains.
“There has been a huge resurgence in pickup trucks,” said Stephanie Brinley, an analyst with IHS Automotive. “The low fuel price situation has given people more money to put into their vehicles.”
Armed with the resources to become competitive, Ram next took steps to keep up with the market, Hegbloom said.
“About 75 percent of the light-duty pickups sold today are crew cabs,” Hegbloom said. “Back in 2009 we didn’t even have a crew cab. We were just introducing it.”
The old Chrysler considered trucks to be work tools and missed the message that they were becoming both family and luxury vehicles. You couldn’t attack those market slices without a crew cab, better interiors and a more comfortable ride, Hegbloom said.
With each upgrade and redesign, Ram introduced new features. It made a link coil suspension system — like what is found in passenger cars — standard equipment to provide a better ride and handling. Rivals use an older leaf spring design that results in a harsher ride. The automaker worked on its styling and improved both the design and materials of the interiors.
“The truck doesn’t look like it came out of a cookie cutter,” analyst Sullivan said.
New and upgraded engines and a smoother, eight-speed transmission improved fuel efficiency.
Those changes have paid off in both greater and more profitable sales.
Among the thousands of trucks the company sold back in 2009, there was only one transaction that topped $50,000, Hegbloom said.
“Just six years later, we have some configurations that are over $80,000 and we are selling more than just one vehicle at that price,” he said.
The sticker prices for at least 50 percent of Ram’s heavy-duty truck offerings are now above $50,000.
But at the same time, Ram has remained something of a value play in the truck segment. Depending on configuration, its average transaction prices are generally several thousand dollars below those of Ford and GMC trucks, and bounce around the sales price of similar Chevrolet pickups, according to digital auto shopping portal TrueCar.com.
Despite Ram’s recent success, challenges remain.
The brand still has inroads to make in the commercial and small-business markets. About 20 percent of the light-duty trucks Ram sells are used for work daily, Hegbloom said. That climbs to about 35 percent for heavy-duty pickups.
Rivals such as Ford, with driver-assist features such as one that makes it easier to back up while towing, will keep turning out the technology that truck drivers want, said Brinley, the IHS Automotive analyst. Will Ram keep up?
“They don’t have to be first with every technology as long as they are the value play in that segment,” Brinley said. “They don’t have to offer cheap trucks — just the right equipment at the right price.”
That’s largely the approach the automaker has taken.
One of its most popular innovations is the Ram box, a lockable storage compartment that sits outside the bed on the side of the truck. It has introduced important technology, such as an optional air suspension with five settings, including one that lowers the vehicle to make it easier to load the bed. Ram also is the only manufacturer of a light-duty pickup to offer an optional V-6 diesel engine — it gets 29 miles per gallon in highway driving. That compares to 20 mpg in highway driving for the basic Ram V-8 mated to a 6-speed transmission.
“They have pushed the envelope in thoughtful engineering without hurting reliability,” said Eric Lyman, TrueCar’s vice president of industry insights.
Until recently, Ram’s gains have come without FCA Group having to pile on big discounts and sales and incentives. Over the last year its discounts have ticked up as rivals launched newer models, Lyman said.
Although discounts will rise and fall with the product cycle, he said, Ram will remain a strong player in the pickup market.
“Ram is in a unique position,” Lyman said. “They have the best opportunity to get the defectors from Ford and GM. You don’t see people go from Ford to GM or vice versa.”
The brand also is developing a demographic profile that is improved from a decade ago and is starting to diverge from the other brands.
“Look at who is coming in to buy us now,” said Hegbloom, Ram’s president. “We are younger; we are more educated. We are getting to the point where our buyers are more affluent.”
Ram buyers are, indeed, different, said Alexander Edwards, president of Strategic Vision, a consulting firm.
They are more interested than GM and Ford customers in having a comfortable interior and making a statement about who they are, according to Strategic Vision’s research. They also are more likely to want a truck to use for their family life as well as work.
Although most truck owners are conservative Republicans, Ram pickup buyers are less conservative than Ford and Chevrolet truck drivers, Edwards said.
Now Ram’s hurdle is to hold on to its share without huge discounting while it readies a redesigned pickup that keeps pace with the recent improvements in the offerings from GM and Ford. Coming up on Ram’s heels are the new Toyota Tundra and new versions of Nissan’s Titan.
The last complete Ram redesign came out in 2013, so the current version still has years to run.
But Hegbloom knows that Ram can’t rest.
“This is a highly competitive segment,” he said. “No one wants to give up anything.”
Editor’s note: This article was prepared by Trucks.com but appeared first on Forbes.com as part of a content distribution agreement.
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