Fiat is seriously commited to rebuilding Chrysler, and to that end it's increased its stake in the Michigan-based automaker by an additional five percent.
The reshuffled ownership breakdown still leaves the United Auto Workers as the largest shareholder at 63.5%, with Fiat's stake now up to 25%, the U.S. Treasury Department retaining 9.2% and the Canadian government 2.3%.
The increased stake came with government approval as Chrysler meets certain performance parameters, in this case the production of the Fully Integrated Robotized Engine (FIRE) at its plant in Dundee, Michigan.
Fiat will have the opportunity to increase its stake by another five percent when it demonstrates growth in overseas markets, and again with the production of a 40 mpg vehicle in the United States. At that point Fiat will have had the opportunity to increase its stake to a maximum of 35%. Details in the press release after the jump.
Chrysler Group LLC Meets First of Three Performance Events; Fiat Increases Ownership to 25 Percent
January 10, 2011 , Auburn Hills, Mich. - Chrysler Group today announced that Fiat's ownership interest in the Company has increased from 20 percent to 25 percent upon the Company's achievement of the first of three performance-related milestones.
As outlined in its June 10, 2009 Operating Agreement, Chrysler Group issued an irrevocable commitment letter to the U.S. Treasury stating that the Company has received the appropriate governmental approvals and will begin commercial production of the Fully Integrated Robotized Engine (FIRE) in its Dundee, Mich., facility. As a result, Fiat's ownership interest increased automatically under the terms of the Operating Agreement.
The ownership interests of Chrysler Group's members are now:
UAW VEBA: 63.5 percent
Fiat: 25.0 percent
U.S. Treasury: 9.2 percent
Canadian Governments: 2.3 percent
The first North American application of the 1.4-liter FIRE engine with MultiAir Technology will be in the new Fiat 500, which Chrysler Group will begin to distribute soon through newly appointed dealers.
Fiat has the opportunity to further increase its ownership in Chrysler to 35 percent, in 5 percent increments, through two additional performance-related milestones. The first milestone relates to revenue and sales growth outside of the NAFTA region. The second milestone relates to commercial production in the United States of a 40-mile-per-gallon vehicle based on Fiat platform technology.