A Bloomberg report from last month said that if Chrysler ends up offering an IPO, it could jeopardize the entire alliance between the Auburn Hills-based automaker and Fiat, but the outlet now says that an IPO could crush the dreams of hopeful Alfa Romeo 4C owners in the US. As the latest Bloomberg report indicates, publically traded shares would prevent Fiat from gaining full control of Chrysler. This would leave Fiat without the full access to Chrysler's cash flow, technology and manufacturing necessary to mass produce the new Alfa Romeo sport coupe inexpensively enough to export to the US.

As CEO of both Chrysler and Fiat, this puts Sergio Marchionne is an awkward position as he tries to purchase the remaining shares from the United Auto Workers union. He is tasked with getting the most money possible for Chrysler shareholders while attempting to spend the least money possible on Fiat's behalf. With Marchionne and the UAW still far apart on the value of the remaining 41.5 percent of Chrysler, the IPO would let the market decide the value of the stake while preventing a full merger between the two automakers and possibly leaving the 4C as a limited-production, Europe-only model.

The video report breaking down the IPO implications – and what it could mean for the 4C – is posted below.


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  • 48 Comments
      rmt_1
      • 1 Year Ago
      As I stated on a previous story on a Chrysler IPO, Sergio Marchionne should just stop this IPO B.S., bite the bullet, and pay the UAW the $5.6-$6 billion dollars they "really" want to get their shares now, before it's too late for Fiat. Every day this situation drags on, Fiat is growing weaker and Chrysler is growing stronger. According to Bloomberg, Fiat's stock value is $10.4 billion dollars and Chrysler's estimated value is $13.5 billion dollars right now and that separation in value will just grow even wider over time and could leave Fiat vulnerable to a costly takeover attempt (perhaps by a Chinese auto company) within 3 years without full access to Chrysler's profits. Car sales in Europe have not bottomed yet and the beginnings of real economic recovery there could be 18-24 months away; Fiat, without Chrysler, would not be able to earn enough profits from the recovering North American market to help cover its European overhead and Fiat doesn't have a significant presence in the Chinese market yet to get help from there either. Time is not on Marchionne's side, because an IPO could easily set Chrysler's value out of reach at over $15 billion dollars and that in turn would hurt Fiat's stock value even more, possibly below $8 billion dollars. Marchionne's hope for paying less than $4.9 billion dollars was as much of a pipe dream as the UAW's hope for getting over $10 billion dollars for their 41.5% of Chrysler was, except the UAW always seemed to understand that from the beginning and Marchionne surprisingly didn't. Any return of the Alfa Romeo brand to the US before a settlement of the UAW's Chrysler shares issue makes no sense, since it could be a huge drain on Fiat's limited cash reserves.
      Street King
      • 1 Year Ago
      Well, the 4C is already going to be coming here - but Alfa needs Chrysler to build the rest of the brand, which includes the Giulia D-segment car, the E-segment sedan, the 6C coupe and a few others. Without Chrysler none of those will happen, but I believe the 4C was built primarily to drive focus to the brand and those very cars.
        AlfaTifoso
        • 1 Year Ago
        @Street King
        Cant wait all-new Alfa Romeos, Giulia will beat 3-series easily in terms of handling and especially in style, then there's a BMW 5-series competitor Alfetta (not official name) and 6C which goes head to head with CLS,6-series.
          Street King
          • 1 Year Ago
          @AlfaTifoso
          IIRC the 6C was going to be a true 2 door coupe, front engine RWD (share with next gen GranTurismo). The E-segment (5-series) competitor would be better if IT was a 4-door coupe to just go against the CLS, A7 and Grand Coupe BMW rather than the 5/E-class/A6.
      groingo
      • 1 Year Ago
      When the Fiat's and Alfa's start doing what they did last time, Chrysler will again spin down the drain to yet another picks them up off the floor again and again and again.
        • 1 Year Ago
        @groingo
        [blocked]
      Semislicks
      • 1 Year Ago
      Americans don\'t need Alfa. In fact, no one needs 4C and that comes from true enthusiast. Overrated and overhyped, overpriced and overstyled. Seems a lot of people forget Opel/Vauxhall Speedster Turbo with faster 0-60 time and 1/3 to almost a half of a price. Same goes with Lotus Elise/Exige. Interior of this car is sub 30 grand teritory, and even with carbon backbone the price can\'t be justified. As for the Giulia, IT WON\'T outgun the 3-series like some clowns here predict, but it could be first alfas performance car since old 75/Milan. One major flaw dough will be its size. It will be larger than 3 series, and it should have been no larger than 156. Other dissapointment is alfas decision to discontinue MiTo and Giulietta. It will be heavy blow to europian Alfa Market, since Giulia won\'t be seller here. Reason will be high prices. A car that will be just under the price of equivalent BMW won\'t turn many premium buyers from their Germans. If you doubt, look at Jaguar and its continuous and infinite battle to get to BMW level. Its like trying to iceskate uphill. No matter how good you are, the peak (BMW, Merc, Audi) will always be miles ahead. If you don\'t believe me, look at sales of EVERY big Alfa sedan. Major flop regardeless how good the car was.
        Shiftright
        • 1 Year Ago
        @Semislicks
        No one 'needs' an Alfa, like no one needs a car with more than 60 hp, but I welcome an alternative to the default German trio which every one and their sister drives. If you really like and get cars, you'll want an Alfa in your life at some point. Then again, some people just will never get it. That's why there's yet another silver or black 'me-too' German sedan waiting for tehm
          Semislicks
          • 1 Year Ago
          @Shiftright
          I would buy Giulietta. I would. 140 HP 2 L JTD. But then, I would drive next to BMW dealership and see brand new 118d M Sport, and trade it in. Reason? RWD, almost PERFECT weight distribution, muuuuch better steering feel. Oh, and I would go for LSD as an investment and have fun on slippery roads. Tell me, what Alfa offers that??? You say everybody drives german. Have you ever asked yourself why is that??? Cause they offer the best in the buisness. Every model is produced to be as perfect as it gets. Comfor, handling, power, economy, interior quality, space and durability. The best for every class the wehicle compete in. The best sedan, the best sportscar, the best MPV, the best SUV. You name it, there's no car that beats the class and isn't german. Thats why german brands made huuuuge profit in last 10 years (and dispite economy), and are continue to do so. Just look at motorsports. Which brand has the most successfull racing history??? PORSCHE. Second one??? BMW. Which brand dominates Le Mans for almost full decade now??? AUDI. Look at VW and Rally!!! They entered competition for the 1. time in MANY, MANY years and as constructor team dominated. Which brand put the most inovation and cartech in history??? MERCEDES. Which company builds the most efficient and best auto-transmissions currently available??? ZF. Which company builds the most precise manual transmissions??? GETRAG. Who owns the fastest car available??? VW. Who saved Lamborghini, Ducati, Bentley from bankrupcy??? VW. Who gave money and tech to Rolls Roys so they can actualy build the cars worthy of Rolls badge??? BMW. Who was behind the curtanis when last gen Land Rover was relaunched??? BMW. Who builds engines for Aston Martin??? GERMANS in Ford DE. Who gave major components/the heart to Pagani Zonda and Huayra??? AMG. Who designes EcoTech engines for GM, EcoBoost for Ford??? GERMANS. And in the end, WHO designed the car in the first place??? GERMANS. So naturaly, the german car is the car everybody wants.
      Mr.K
      • 1 Year Ago
      Very low journalistic standards. "Chrysler's cash flow, technology and manufacturing necessary to mass produce the new Alfa Romeo sport coupe inexpensively enough to export to the US". Wrong. Fiat needs Chrysler’s dealerships . Not: Chryslers cashflow to introduce an already invested Alfa 4c Not: Chrysler’s technology to produce the already designed 4c Not: Chrysler’s manufacturing knowhow to produce a carbon fiber car that is already being manufactured.
      Mr.K
      • 1 Year Ago
      Very low journalistic standards. Report not fact based. "Fiat needs: Chrysler's cash flow, technology and manufacturing necessary to mass produce the new Alfa Romeo sport coupe inexpensively enough to export to the US". Wrong. Fact is Fiat needs Chrysler’s dealerships. (Maserati dealers? maybe not). Fiat doesn't need 1.Chryslers cashflow to introduce an already invested Alfa 4c 2.Chrysler’s technology to produce the already designed 4c 3.Chrysler’s manufacturing knowhow to produce a carbon fiber car that is already being manufactured.
      Bill Burke
      • 1 Year Ago
      I'm for the IPO and some US control of Chrysler. This is the best way to assure that Chrysler Group gets all it needs from Fiat and keeps the relationship fluid enough to insure mutual dependence and respect. My answer to the 4C is to build a Chrysler bodied version that will spread development costs and give the Chrysler brand a halo sports car. Of course certain economies will have to be made to the Chrysler version to make it less costly, but Chrysler buyers will demand all the Chrysler styling cues and other traditional Chrysler parts that will make for a reasonable claim to this car being a Chrysler. That will get the Alfa Romeo 4C here, which I'm told will be sold in Maserati/Ferrari dealerships, and give Chrysler the sports car to replace the Crossfire it really needs more than most realize.
        Semislicks
        • 1 Year Ago
        @Bill Burke
        yeah burkey boy, chrysler need an italian based 2 seater MR sports car as a halo car. Nice going. What Crysler need is MUSCLE car. Like Barracuda SRT. Something AMERICAN and NOT italian!
        Jonathan Woodall
        • 1 Year Ago
        @Bill Burke
        Fiat already gave Chrysler a nice Alfa for them to ruin (Giulietta -> Dart), why do it to an even more amazing 4C??? Chrysler dealers and customers have zero interest in European (or European adapted) cars and the 4C is already being built in Italy, why invest all the money to move production to the US for a car that would be completely and utterly doomed from the start?? And why does Chrysler need another Crossfire? Nobody bought the first one, they didn't make very many and still couldn't sell them. The ones that did sell mostly just did so because people knew they were getting an SLK for less money than an SLK costs. IIRC they wound up dumping most of the 2006 models on overstock.com.... Chrysler customers don't want small 2-seater sports cars, they want big heavy, not that innovative American cars like the Charger, Challenger, 300, etc... Keep cars like the Alfa at Fiat dealers, who need the nicer Alfas that are coming to bring their line-up up a little. They would help customers at Fiat dealers see that the Fiats aren't just small, cheap cars, they're Italian and interesting. People passing by that don't know anything about Fiat aren't aware that they are anything special, they just see a small car that costs more than some crappy Kia. The Alfas would provide some legitimacy to the Fiats.
        LW
        • 1 Year Ago
        @Bill Burke
        If you can't stuff a 700 cubic inch V8 with 200 gross hp in that glove compartment they call the engine bay, then there is way that would be called a halo car. And that door looks way too short for it to sag 2 inches when open.
        Teleny411
        • 1 Year Ago
        @Bill Burke
        I wish Chrysler would build a 300 coupe. You can't tell me that and a 300 Vert wouldn't fly off the lots.
      RGT881
      • 1 Year Ago
      I also wonder if GM and Ford are secretly trying to influence this situation, or at least, drag it out as long it is possible. It makes sense for them to do so because that means that FIAT/Chrysler are in limbo, and they can't come up with a solid product strategy while this debacle is ongoing.
        • 1 Year Ago
        @RGT881
        [blocked]
      Man of men!
      • 1 Year Ago
      Even in Europe; Alfa Romeo is considered an ugly look car! I not impress with the brand nor the car itself. I don't know why Fiat want to bring this brand to the U.S.; since it not selling well in the EU!
      Jeff Dance
      • 1 Year Ago
      Fiat is dead broke without Chryslers cash flow, Chrysler has old tech and needs a partner. Chrysler does not have the financial resources to compete with product that the dominate players in the north American market offer . If fiat can not access capital to purchase the veba shares both will die, one a very slow death while the other will implode.
        gtv4rudy
        • 1 Year Ago
        @Jeff Dance
        Fiat has plants in China, Poland, Serbia, India, Argentina, Italy, Mexico and Russia and they're going broke if chrysler won't sell the stock?
          Jeff Dance
          • 1 Year Ago
          @gtv4rudy
          gtvrudy Fiat may have the production plants but none are anywhere near capacity, most are running 20% to 30%.capacity. If you are not running at 80%+ capacity you are losing money!
        Teleny411
        • 1 Year Ago
        @Jeff Dance
        You are right: they need to find a middle ground or both are in trouble. Fiat needs to get some Alfas into Fiat dealers lots. I'm afraid Fiat is botching things and I want them to be a success-ditto Chrysler.
          Jeff Dance
          • 1 Year Ago
          @Teleny411
          The smartest play would involve a sugardaddy from the east that needs production,engineering,styling,marketing, dealer networks and heritage from the west to become a legitimate world class player.
      • 1 Year Ago
      [blocked]
      Arturo Rios Jr.
      • 1 Year Ago
      I would be sold if it was 45k or less.
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