Back to the Future With two big arrivals, Chrysler gambles on rear-wheel drive
By Lawrence Ulrich

(MONEY Magazine) – Big sedans. Big wagons. And above all, V-8 engines sending big power to the rear wheels--never, ever the front. Sounds like America, circa 1974. But for the Chrysler 300 and Dodge Magnum, it's no nostalgia trip. Chrysler is convinced that Americans want affordable alternatives to the luxury liners of Mercedes, BMW and Lexus, brands that gain an edge in handling and refinement by using rear-wheel drive.

Chrysler calls it "the return of the great American car." Hyperbole aside, the 300 sedan and its Dodge wagon offshoot are pleasingly modern takes on the traditional cars that Detroit once did best. Driven in a mercurial mix of sun, rain and high-country snow in and around Palm Springs, Calif., the duo shone as stretch-your-legs cruisers--as big and roomy as a Lexus LS 430 and as hushed inside. (Credit in part Chrysler's new $36 million acoustic wind tunnel.)

These replacements for Chrysler's aging front-drive sedans--including the Dodge Intrepid and Chrysler 300M--also start at a friendly price: $22,495 for the Magnum, $23,595 for the 300.

THREE POWER PLANTS Those base models, however, make do with just 190 horsepower from a 2.7-liter V-6. Aim instead for the mid-grade engine, a 250-horsepower, 3.5-liter V-6. That larger V-6 is standard in the better-equipped Magnum SXT ($25,995), 300 Touring ($27,395) and 300 Limited ($29,980).

Power users will lust after the luxurious Hemi-powered 300C ($32,995) and Magnum RT ($29,995) versions. (Hemi refers to the pistons' power-boosting, hemispherical combustion chamber.) But while I'm an admitted horsepower addict, I can't help feeling that the Chryslers play less convincingly above $30,000--a Darwinian land already teeming with predators like the Infiniti G35, Acura TL, Audi A4 and BMW 3-Series. Smaller creatures, sure, but also nimbler, more richly attired and, in some cases, even faster than Chrysler's two-ton beasts.

Clearly, Chrysler's high-end fortunes rest heavily on the 5.7-liter Hemi V-8 first uncorked in the Ram pickup. This terrific engine produces 340 horsepower and a vast 390 pound-feet of torque. It's good for zero-to-60 mph sprints in 6.3 seconds.

While the name harkens back to Chrysler's muscle-car past, this modern slab of Detroit iron has been re-educated: A sophisticated "multidisplacement" system shuts down four of the eight cylinders to save fuel when you're cruising along. (General Motors and Honda will offer similar technology on upcoming models, but score Chrysler a first.) That means EPA economy of 17 miles per gallon city and 24 highway, identical to the Mercedes S430, although the Benz's smaller V-8 produces 65 less horsepower. Chrysler insists that drivers will see even better results in real-world driving.

NEW LAYOUT, NEW LOOK The switch to rear-wheel drive may dismay people who are sold on front drive, but it's clearly the right move. "For a performance sedan, dynamically [front drive] just doesn't work," said Eric Ridenour, Chrysler's executive vice president for product development. (See the box at right.)

Hemi-powered versions also get a sport-tuned steering and suspension, plus a rear anti-sway bar to reduce body roll in turns. Throw in larger 18-inch wheels and tires, and the V-8 models steered and handled with more assurance on the snaking mountain roads.

Burly styling seems guaranteed to grab attention, if not universal praise. The 300 is all shoulders and haunches, with a grille the size of a manhole cover. I was more taken with the Magnum: The sinister, low-roofed wagon looks like what Bonnie and Clyde would have driven if they'd added "parent" to "hood."

Chrysler, of course, is in the corporate clutches of Mercedes. And if that has been disastrous for shareholders, it's been a boon for the cars themselves: Both models incorporate proven Mercedes parts and designs, including Chrysler's first-ever five-speed automatic transmission (for now only in V-8 versions, later in V-6 and V-8 all-wheel-drive models that debut in the fall). The rear independent-suspension design comes from the E-Class, along with the stability-control system and antilock brakes that are standard on up-level models.

BOTTOM LINE With limolike space inside, Chrysler's new pair blow away dowdy domestics like the Buick Park Avenue; they're fresher and friskier than a Toyota Avalon. Both feel solid and well engineered. But I'm troubled by a price near $40,000 for loaded AWD models. Will people pay over $35,000 for a Chrysler? For its Pacifica and Crossfire, the answer has largely been no.

Honda, Toyota and Nissan have each invested years and billions to establish respected luxury brands--Acura, Infiniti, Lexus--with classier models to do the dirty work above $30,000. Fair or not, it's how the game is played. But Chrysler and Dodge are each counting on a single model to start low enough for family buyers yet dress up enough to win dates with the luxury crowd. That's a tall order for any automaker, let alone blue-collar brands with no designer cachet.

Maybe the answer for Chrysler is to create its own luxury brand, a kind of Motown Mercedes: It can always hit up the original for money and advice.