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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.

[Source: Chrysler]
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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.

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    • 1 Second Ago
      • 4 Years Ago
      Looks like the alliance is doing well.
      • 4 Years Ago
      i still really don't understand how an autoworkers union can own an auto manufacturing company and employ their own members. isn't this a massive conflict of interest?
        • 4 Years Ago
        No -- it would only be a conflict of interest if the UAW leadership actually cared about taking care of its membership.
      • 4 Years Ago
      63% owned by the UAW??? I'm never buying another Chrysler product as long as I live. I lived in Detroit, I've been in the plants and see how hardworking the UAQW is.... NO THANKS!!!
      • 4 Years Ago
      Are you interested in the Fiat 500?

      Join our new forums for North American Fiat 500 enthusiasts at http://www.FiatScene.com

      • 4 Years Ago
      Fiat is good at small cars, Chrysler is good at big ones - this seems like a happy marriage.
        • 4 Years Ago
        The thing is Fiat's problem has never been producing larger cars, it's really all about their brand and markets. Fiat's core markets, Southern Europe, are not centered around larger cars.

        In Western/Northern Europe we have different needs and expectations. We don't live in small Italian villages or ancient cities with tiny streets. I need more winter grip than air conditioning. The cars have to be designed for my local conditions.

        My past experiences with Fiat's quality and design makes me avoid them at all costs. I would not buy *any* car from Fiat, unless I lived in Italy where it would work.

        Fiat won't be able to move large numbers of their larger vehicles in Europe under either brand. Fiat's huge in Italy,
        • 4 Years Ago
        Its already proven to be happy, potentially the happiest of all alliances. Even the "bridge" vehicles until the real ones in 2013 are spectacular.

        This is one company to watch.
        • 4 Years Ago
        @andrewh12, interesting comment. I want to know if you live in Norway and if Fiat is a popular car there, especially the 500? North America is waiting for their arrival with anticipation by long ago Fiat enthusiasts. How do the newer Fiats perform in the frozen open spaces of Norway these days?
        • 4 Years Ago

        Yes, I live in Norway. Fiat's have never been great on snow and ice, or indeed in [Arctic] cold temperatures. When it's -30 C outside I still need my car to start and take me to work :)

        People bought Fiat 500's here as well, mostly for the "charming" design, however Fiat created a Nordic version especially for our climate. It comes with an extra pre-heater for the engine etc. The standard European version obviously does not have this.

        While we have vast, open landscapes, it's more mountainous than not :)
      • 4 Years Ago
      When Marchionne bankrupt Chrysler again, I sincerely hope that Fiat goes together, with its crap products. The only problem if Fiat bankrupt, the "entire" Italy will be unemployed.

      Fiat products don't fit even in Europe today. Punto is the only strong seller Fiat in Europe, but not that good like mid 90's. The 500 had its hype (it was the Italian Beetle for sure), but seriosly, is only a kild entry-level car with average quality and high price tag. The Panda is extremely cheap, you can imagine the build quality looking at the pictures at Fiat website. If you think about larger cars than superminis/subcompacts, after Fiat Tipo, wich was the first sucessfuly compact Fiat, they tried 3 times to repeat the success, but without reaching it because they are only average cars even when you compare with japs in this class.

      If you can buy a good Jap or a French car, why in the hell do you want to buy a fiat? If you wnt to go even cheaper go for a Korean, not for a Fiat.

      Today Fiat sells a lot in development countries, a.k.a. Third World, like Brazil, Argentina, Turkey, Romania, China, India and others (even north korea "Pyonghwa Motors " produce Fiats). The profit in this countries are a way lot better that they do in Europe, this places we can call the sponsors of Fiat Europe, with this money they do this madness and outrageous things like keep two brands (Alfa Romeo and Lancia) that together didnt sell 500.000 cars in 2010 in Europe. (FWD Opel platform Alfas and Badge engineered Fiats called Lancias). The only good cars for these brands are the 8c and the new Stratos, but they are only a image products based on Maserati and Ferrari.

      How in this today aggressive market, Fiat can keep three brands in Europe (Alfa, Lancia and Maserati) and two in USA (Chrysler and Dodge) that only produces money losses.

      This thing isn’t right, let’s see what happens
      • 4 Years Ago
      Does Anyone else think that they shouldn't name the engine just "FIRE"?
        • 4 Years Ago
        the name fire to me, sounds like it's fast a furious, not that it will actually catch on fire... so i don't see why not...
        • 4 Years Ago
        But it's such an awesome pun! Too bad it's not used in any fire engines...
      • 4 Years Ago
      Thanks for the insight...not!
      • 4 Years Ago
      I hope it works out for them, hope it doesn't turn out to be another marriage like AMC/Renault back in the 80s - Renault was supposed to be AMC's savior and everything was supposed to be hunky-dory, and remember how that turned out? AMC ended up getting swallowed up by Chrysler and Renault was sent packing back to France. Hopefully not a case of poetic justice.
        • 4 Years Ago
        Why do people mention AMC/Renault or Chrysler/Mercedes as if it had any relevance? There's nothing predetermined, it doesn't even involve the same people, companies or market conditions. Where the connection? A "scary" foreign company?

        AMC did not fail due to the French, they needed French financial and technological help. They were on the brink of collapse. The takeover did happen during an economic downturn, soaring energy prices, rising American unemployment, automobile plants shutting down, and an American market trend towards imported cars...

        AMC had the oldest facilities in the world, and even older technology in their models. Renault infused new life, but it was too late, in a rapidly changing market, AMC was just not viable. You can't blame the French when the patient was terminal to begin with.
      • 4 Years Ago
      Fiat diesels for the USA! The sooner the better.
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