• May 1st 2009 at 10:59AM
  • 30
We all know by now that Fiat will take an initial 20% stake in Chrysler in exchange for supplying the bankrupt automaker small-car platforms and fuel efficient drivetrains. Further down the road, Fiat will have the opportunity to purchase a large stake in Chrysler, upping its ownership to 35% and between 2013 and 2016, the Italian automaker can take an additional 16% share of Chrysler, bringing its total to 51% and gaining majority control. However, until Chrysler repays its loans to the U.S. Treasury, Fiat's share must be kept at 49%. For Fiat to take control of Chrysler, the crew from Auburn Hills will need to pay back over $10 billion in loans, and we remain suitable skeptical that Chrysler will be able to return the cash – particularly with new products from Fiat still 18 months away, at least.

[Source: SMH | Image Source: Vittorio Zunino Celotto/Getty]


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  • 30 Comments
      • 6 Years Ago
      isn't this the fiat that had no money itself only a few years ago, where is it all coming from
        • 6 Years Ago
        FIAT SpA is a huge Italian industrial conglomerate of which automobile manufacturing is only a small portion of the entire company. The conglomerate, itself, is doing remarkably well, thank you very much and not it need of any financial support whatsoever.

        True, GM gave FIAT a $2 billion dowry "to get lost" a few years ago. FIAT parlayed that loot into a sizeable enterprise that is now thriving, but is also on as shaky ground as everybody else nowadays.

        Sergio Marchionne is from the same school of ideas that I believe in. "Expand your business during a downturn, so that when recovery returns you are in a position to grab onto a much bigger of piece of the pie." Just watching this guy work unbelievable deals is an education in itself. Just think...nothing down; no investment, plus you get $6 billion from the government to take over a failing company. How can you lose?
      • 6 Years Ago
      The best thing Fiat could do would be to kill the Chrysler brand...keep Dodge for Trucks and Jeep for SUVs...

      Kill Chrysler...
      • 6 Years Ago
      Does anybody in North America want a fuel efficient car? Fiat maybe great overseas but I am not aware of anybody who wants small efficient cars. This could wipe out both companies.
        • 6 Years Ago
        Nah if Fiat doesnt meet their expected sales they simply leave Chrysler to it's destiny and exit the market.
        • 6 Years Ago
        @Bakka

        '...not aware of anybody who wants small efficient cars.'

        Famous last words. Wait until the next gas price spike. Once again, the sales of smaller cars will peak. And I would be willing to bet that this (next) time, the lesson may just stick with consumers.
        • 6 Years Ago
        There's one possible bit of technology that may be a game changer in the interests of mileage, emissions, etc. While FIAT sold common rail technology rights to Bosch, they still retain the new MultiAir tech. If you think diesel is viable now, wait until MultiAir comes into full swing.

        For info: www.gizmag.com/fiat-releases-multiair-engine-technology--is-this-a-fundamental-breakthrough-in-internal-combustion-engine-design/11184/
      • 6 Years Ago
      These are interesting times.
      • 6 Years Ago
      You know, I think Fiat ownership could actually work pretty well. Chrysler has always been a decent bunch of engineers, they just have had bad direction/management. If Fiat was in charge, management could be gutted, and a lot of investment could be put toward revitalizing the brand image.

      Not to mention the US would get access to a lot of cool platforms from the Fiat bin. Grande Punto based sedan with the Sebring name? Yes please.
        • 6 Years Ago
        Sebring has no equity whatsoever. Even the reviewers that liked it admitted there was a stigma surrounding the name.
      • 6 Years Ago
      If Chrysler is even around in 2013.

      Bankruptcy, paying billions in US taxmoney to Fiat to take it over and giving another big stake to the UAW does nothing to address the fact that Chrysler has a product lineup that doesn't sell at all.

        • 6 Years Ago
        Just bring over the 500, unchanged. :)
        • 6 Years Ago
        I agree, that's why I think Chrysler will be in bankruptcy at least until 2012. They have to first get some new models to market before we see any substantial increase in sales and profits.
      • 6 Years Ago
      I heard the UAW will be taking 55% stake in Chrysler which puts them in charge of their own results. It will be interesting to see how the inmates run the prison so to speak.
        • 6 Years Ago
        The first thing they will do is double their wages and benefits; then cut all salaried employee wages in half.
        After the first year, they will be trying to figure out what went wrong with their plan as they scramble to stay out of bankruptcy court.
      • 6 Years Ago
      I just hope no one pronounces Lancia as "lan-see-aa". It's "laan-chya".

        • 6 Years Ago
        I'm not gonna lie, I was in this camp until the last time I watched Herbie Goes to Monte Carlo a few weeks ago and heard Don Knotts saying it right. What a way to find out, eh?
        • 6 Years Ago
        They will, They couldn't pronounce Renault when it was here. They will mess Lancia up totally.
        • 6 Years Ago
        ROFL, I don't mind Fiat doing that as long as they won't do what Daimler did,
      • 6 Years Ago
      jamie@

      Do you have any info on gas tax ?
      I can see it rising,but to EU levels?!
      • 6 Years Ago
      "Fiat could take majority control of Chrysler as early as 2013"

      What makes you think Fiat will be around in 2013?
      They're not exactly swimming in cash either...!
      • 6 Years Ago
      I still don't see much that can be sold here in the US. Most of their lineup looks like crap. I hope the 18 months is factoring in new bodywork.
        • 6 Years Ago
        Plain wrap is what sells for everyday, pedestrian commuter cars. And the whole reason they're in this mess is about sales, isn't it?

        @ Steve S:

        If the Abarth 500 doesn't stir your soul, I'm afraid you don't have a pulse.
        • 6 Years Ago
        Every single car in the Alfa Romeo and Fiat line up looks miles better than what Chrysler or Dodge has to offer today.
        • 6 Years Ago
        sk - Give me a break. I'm a Italophile but I give credit where it's due and I'd rather have a Charger SRT, Magnum or Challanger R/T or Viper than any FIAT. Heck, many Italians will agree with me.
        • 6 Years Ago
        While I still have a few vintage Italian cars in my collection, I can say most of FIAT's modern offerings are very consumerish (is that a word?) and practical. But maybe that's what Chrysler needs. Good selling everyday cars. If you want something with more 'soul' as a previous poster said, get a more sportier Alfa. Now as for the Abarth 500S someone mentioned, that looks like a car that would get me back into autocrossing and time trials.
        • 6 Years Ago
        Mazda, you do realize that dodge (challenger) is a brand owned by chrysler. If it comes to italians choosing between a Challenger SRT (or Viper or whatever) and a F430 or a 599 or a quattroporte (coz you know, fiat owns Ferrari and Maserati), i would be really surprised if you found anyone going for the dodge... Surprised is actually an understatement, i would be laughung out loud.
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