The Strategy Behind the 2015 Dodge Hellcat's 707-Horsepower Madness

The 2015 Dodge Challenger SRT Hellcat: 707 horsepower and a quarter-mile time under 11 seconds. Price? Still to come, as Dodge's bit-by-big marketing campaign continues. Source: Fiat Chrysler.

The wild numbers keep piling up for Fiat Chrysler's (NASDAQOTH: FIATY  ) latest halo car. 

On Friday, FCA released a video showing the 2015 Dodge Challenger SRT Hellcat on a drag-strip run -- returning a quarter-mile time of 10.8 seconds at 126 miles per hour. 

Those are staggering numbers for a factory-stock mass-market car, notwithstanding that they happened with special drag-race tires. Not long ago, a quarter-mile time of under 11 seconds was the province of the world's most exotic cars and heavily modified dragsters.

But this latest Dodge Challenger is a real car, one that will go on sale this fall at a price well below six figures. 

It's a fascinating product -- but what's really fascinating is the way that the Hellcat's marketing is supporting a major shift in emphasis for FCA's 100-year-old Dodge brand.

This is about selling a lot more than a new muscle car
In May, Fiat Chrysler spent a full day briefing analysts and media on the newly merged company's five-year plan. A key part of the plan: repositioning Dodge as a mass-market brand focused on high performance.

Over the next couple of years, we learned, the Chrysler brand would become FCA's mainstream brand in the United States. Chrysler would get the minivans and mainstream sedans and kid-haulers that were once Dodge's bread and butter. Meanwhile, Dodge's product line will be retooled to focus on speed and power, in a bid to draw younger buyers to FCA's U.S. showrooms.

A Challenger SRT Hellcat prepares for a dragstrip run. Source: Fiat Chrysler.

It's an interesting strategy that looks to Dodge's fabled muscle-car history for inspiration. But Dodge's heirs to that muscle-bound history, the Challenger coupe and Charger sedan, have long been considered so-so entries, too heavy to hang with the high-powered versions of General Motors' (NYSE: GM  ) Chevy Camaro and Ford's (NYSE: F  ) Mustang.

They had their fans, of course. But an aspiring high-performance brand needs a high-performance flagship that can go toe-to-to with anything.

That's where the Hellcat comes in.

YouTube videos, track stunts, and a lively rumor mill
The "Hellcat" is actually an engine, an internal Chrysler code name for a new supercharged version of its mainstay Hemi V8. The new 6.2-liter engine was engineered with robustness and longevity in mind -- a good thing, because that supercharger is pushing it to a whopping 707 horsepower.

The existence of the Hellcat engine has long been an open secret in car-enthusiast circles, but what has not been known is how much power it would make -- or how much a Hellcat-powered car would cost.

Neither of those questions were directly answered when the Hellcat-powered version of the refreshed-for-2015 Dodge Challenger was revealed in May. "Over 600 horsepower" was all Chrysler executives would say. 

That particular cat got let out of the bag on July 1, not coincidentally the 100th anniversary of the founding of the Dodge brand, with a short press release -- and a YouTube video with a Mötley Crue soundtrack:

The Hellcat's 707 horsepower is more than GM's hot new Corvette Z06 (650) and more than the hottest version of the outgoing 2014 Ford Mustang (662). That set car enthusiasts buzzing in a big way.

But in online discussions, Ford and GM fans pushed back: The Challenger is so heavy, they argued, how fast will it really be? 

Dodge answered that question on Friday with another YouTube video that revealed the car's quarter-mile times. "Dodge is racing into the front lines of the horsepower wars," Dodge CEO Tim Kuniskis said in that video -- before cutting away to footage of a drag race between a 1971 Hemi Challenger and a new Hellcat. (Spoiler: The Hellcat won, and it wasn't close.) 

That video will surely spark another week or two of discussion about the car, at which point, presumably, the Dodge marketing mavens will release another tidbit of information to keep the world talking about their new car -- and about their brand.

Even without a single sale, the Hellcat has already been a success for FCA
The brand is the real story here, at least from a business perspective. Kuniskis has hinted that he expects the Hellcat to make up about 5% of Challenger sales, which totaled a bit over 50,000 in 2013.

Even allowing for a rush of first-year buyers, it seems unlikely that sales of the Challenger SRT Hellcat will break into five figures for the 2015 model year. While it will almost certainly be a nicely profitable product for FCA, the Hellcat alone isn't going to make a big contribution to the company's global bottom line.

But it is making a big contribution to the repositioning and marketing of the Dodge brand, even before a single car has been sold. 

Warren Buffett's worst automotive nightmare (Hint: It's not Tesla Motors!)
A major technological shift is happening in the automotive industry. Most people are skeptical about its impact. Warren Buffett isn't one of them. He recently called it a "real threat" to one of his favorite businesses. An executive at Ford called the technology "fantastic." The beauty for investors is that there is an easy way to invest in this megatrend. Click here to access our exclusive report on this stock.


Read/Post Comments (0) | Recommend This Article (7)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 3026385, ~/Articles/ArticleHandler.aspx, 11/21/2014 1:06:42 PM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...


Advertisement