Sergio Marchionne, CEO of both Chrysler and Fiat, has stated that the planned unification of both companies will have to wait a little longer as the Italian automaker grapples with the European financial crisis. Marchionne has previously stated that the goal was to achieve unification as early as 2014, but that has temporarily been put on the back burner while Fiat aims to strengthen its finances.

In a Reuters report, Marchionne said, "The objective has always been to try and bring unification by 2014 or 2015... I'd still like to see that done." Marchionne went on to say that Fiat would not have the capital to make that move as early as 2014, unless "something extraordinary happens and we find liquidity through other means." According to the report, Marchionne's top priority is fixing its European situation.

This is all in relation to Fiat's plan to purchase the remaining 41.5 percent stake in Chrysler currently held by the United Auto Workers healthcare trust. The trust was created as a move to unburden Chrysler from retired workers' healthcare costs.

Fiat tried to purchase 3.3 percent of the American automaker this July for $139.7 million. The healthcare trust claimed that figure was not enough and refused to sell the portion, resulting in a lawsuit brought by Fiat against the healthcare trust. No update was given on the lawsuit, though Fiat stated that it plans on making another 3.3 percent purchase in January.


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  • 17 Comments
      MF
      • 2 Years Ago
      not sure why VEBA would turn down that offer.. at that evaluation, the entire company would be worth ~$4.6 - 5.0 billion, which is more than most industry watchers predict.. its a great deal considering Fiat got 20% of Chrysler for just showing up ;)
      Dump
      • 2 Years Ago
      Purchasing the remaining shares/stakes in Chrysler will become a financial fiasco in the coming years. The Trust managing the ownership stake will, no doubt, want a lot more for their shares...especially when Fiat believes the merged corporation will continue to do better in the coming years.
      Mike Lee
      • 2 Years Ago
      That ends it for me; Chrysler merged fully with (of all things) Fiat? No way on earth I'll ever buy/own a Chrysler again (and I've had more than one). Fiat's reputation for marketing JUNK has killed any interest I might have otherwise had in ANY Chrysler vehicle(!).
      guyverfanboy
      • 2 Years Ago
      Sergio Marchionne has done a great job with Chrysler so the sooner the companies unify, the better!
      lasertekk
      • 2 Years Ago
      He's done well. I think he's the right man for the job, unlike those earlier guys (Daimler, Cerberus)
      icemilkcoffee
      • 2 Years Ago
      On what grounds are they suing the Healthcare Trust for not selling their stake? I mean- it's a frigging free market. You can make an offer, but the other party is under no obligation to sell to you.
        1guyin10
        • 2 Years Ago
        @icemilkcoffee
        In this case there is a contractual obligation to sell. The contract that established the current Chrysler allows Fiat to buy out VEBA in 3% increments. The issue is that the contract set the purchase price at Chrysler's 2009 valuation and now VEBA is trying to get more. The lawsuit is not over whether VEBA has to sell - that is already established and agreed by both parties - it is only over what the price will be.
      caddy-v
      • 2 Years Ago
      Hey Sergio, that Yassir Arofat look isn't cool.
      Yang Xi Gua
      • 2 Years Ago
      I wonder if FIAT would kick out the union once it completes its takeover of Chrysler?
        sinistro79
        • 2 Years Ago
        @Yang Xi Gua
        Mussolini kicked out the unions too...and ultimately that choice of leadership style didn't turn out too well for Italy. I hope Marchionne takes a softer approach to the unions even though the general opinion of the day is that they make things more inefficient for the most part. The truth of the matter is that happy workers produce better products.
      Judyz
      • 2 Years Ago
      There is tremendous irony here. This hookup started with Fiat being "gifted" 20% of Chrysler. At the time that was considered to be 20% of nothing based on the prospects of bankrupt Chrysler. Fiat was seen as the big brother with a helping hand. Fiat's ability to purchase the rest of Chrysler looked like a formality. Fast Forward a bit a Fiat is struggling. The european market they depend on is tanking. Chrysler's sales are rebounding and their balance sheet is looking pretty good. Fiat is going to find the cost of buying Chrysler will keep going up and in the current european market Fiat isn't likely to have any extra cash any time soon. What was a shotgun wedding is slowly turning into a marriage into a more equal partnership.
      viperbono
      • 2 Years Ago
      Hoping for Fiat/Chrysler Based in Detroit, but if not I think I would rather unfortunately support Italy over Japan!
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