Autoblog

Fiat increases Chrysler stake to 58.5%

Jeff Sabatini — Thu, 05 Jan 2012 16:29:00 EST

Filed under: Government/Legal, Chrysler, Earnings/Financials, UAW/Unions

How important is the forthcoming 2013 Dodge Dart to the future of Chrysler? Well, it allowed Fiat to boost its stake in Chrysler for the fifth time in the past year today, adding five percent to bring Fiat's total ownership to 58.5 percent.

That's because the new Dodge sedan scored a combined 40 miles per gallon in CAFE fuel economy testing, triggering the increase in ownership under the operating agreement reached following the Chrysler bankruptcy proceedings. (Note that the 40 mpg number is unadjusted, meaning that the actual EPA combined fuel economy, the one published on the window sticker, will be lower.) Chrysler sent the United States Treasury a letter stating that it was "irrevocably committed to begin assembly" of the Dart at its Belvidere plant in Illinois. Chrysler will take the wraps off the Dart on January 9 at the Detroit Auto Show.

Fiat's stake in Chrysler has grown considerably since it received its initial 20-percent share in the immediate aftermath of the automaker's bankruptcy. The Italian automaker has now met all the "performance events" of its agreement with the Treasury, and could buy out the United Auto Workers healthcare trust that owns the remaining 41.5 percent of the company, according to a report in Automotive News. However, that report indicates that Fiat's financial situation may not be solid enough to do so - at least not right away.

To read Chrysler's full press release, click through to the jump.

Continue reading Fiat increases Chrysler stake to 58.5%

Fiat increases Chrysler stake to 58.5% originally appeared on Autoblog on Thu, 05 Jan 2012 16:29:00 EST. Please see our terms for use of feeds.

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Chrysler split over which CAD software to use

Sam Abuelsamid — Tue, 04 May 2010 08:01:00 EST

Filed under: Technology, Chrysler, Fiat

Anyone that's ever tried to get divergent computer systems to play nice knows that it's not a trivial matter. And when two automakers come together, getting everyone on the same page is both enormously difficult and critically important if the enterprise is to succeed. Chrysler is all too familiar with lackluster enterprises thanks to failed marriage to Daimler, and with it's recent Italian tie-up, the (software) language barrier could cause some problems.

Now that Chrysler has hooked up with Fiat, the two engineering teams need to consolidate the design software that they use to develop new products. As we learned in the Chevy Cruze safety story, computer aided design and simulation is the foundation to being able to develop products that meet regulations around the world.

Chrysler's engineers have been using Catia from Dassault Systems for more than two decades while Fiat uses the other major brand Siemens PLM's NX software. CEO Sergio Marchionne wants everyone in his domain to use the Siemens software for new projects. Unfortunately, the problem goes well beyond just switching out the software at the Chrysler tech center. Suppliers will also have to buy new software because they share design models with the automaker and they need compatibility. Chrysler has begun using the Siemens software for the modifications to the North American version of the Fiat 500, but it could be some time before the issue is resolved completely.

[Source: Automotive News - Sub Req'd]

Chrysler split over which CAD software to use originally appeared on Autoblog on Tue, 04 May 2010 08:01:00 EST. Please see our terms for use of feeds.

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Obama announces Chrysler bankruptcy, deal with Fiat; Nardelli out soon *UPDATED

Frank Filipponio — Thu, 30 Apr 2009 12:36:00 EST

Filed under: Government/Legal, Chrysler, Earnings/Financials

President Obama has just concluded a televised press conference where he announced that Chrysler will indeed head into Chapter 11 bankruptcy proceedings almost immediately. As part of the same announcement, he noted that the Auburn Hills automaker has reached terms with Fiat and will be headed into a partnership agreement that will include a cash infusion and technology transfers. By some estimates, the restructuring is expected to take 30-to-60 days.

The announcement came after late-night talks with a small group of creditors broke off before a restructuring plan could be reached. During the conference, Obama took pains to note the sacrifice of many players, including some in the financial sector, but he openly chastized other hedge fund operators and speculators for holding out for more debt compensation, arguing that they were looking to make money on the taxpayer dollars.

Keeping an upbeat tone in his announcement, Obama also reassured Americans that they will be repaid in full before Fiat gets any stake in the automaker, and that GMAC has agreed to step in to provide loans for Chrysler vehicles. Canada is also pitching in to make it work, but the U.S. taxpayers will be on the hook for an additional $8 billion in aid. Obama also reiterated that the government will stand behind Chrysler and General Motors vehicle warranties, and he extolled Americans to purchase new vehicles from domestic automakers.

Finally, in related news, it is being reported that Chrysler CEO Bob Nardelli (whom Obama praised during the press conference) will exit the company after the bankruptcy filing is complete.

*UPDATE: A new Chrysler press release (posted after the jump) confirms that Nardelli will leave Chrysler after it emerges from bankruptcy:

He will return to Cerberus Capital Management LP as an advisor. "Now is an appropriate time to let others take the lead in the transformation of Chrysler with Fiat," said Nardelli. "I will work closely with all of our stakeholders to see that this new company swiftly emerges with a successful closing of the alliance."

The Detroit Bureau's Ken Zino has excellent analysis of the announcement here.

More details and analysis on the way...

[Image: Bill Pugliano/Getty]

Continue reading Obama announces Chrysler bankruptcy, deal with Fiat; Nardelli out soon *UPDATED

Obama announces Chrysler bankruptcy, deal with Fiat; Nardelli out soon *UPDATED originally appeared on Autoblog on Thu, 30 Apr 2009 12:36:00 EST. Please see our terms for use of feeds.

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BREAKING: Chrysler and Fiat announce partnership

Dan Roth — Tue, 20 Jan 2009 07:31:00 EST

Filed under: Europe, Plants/Manufacturing, Chrysler, Fiat

Chrysler announced this morning that the beleaguered automaker has entered into a global strategic alliance with Fiat SpA, giving both companies access to each others' products and markets. Fiat will also lend a hand in developing a business plan to present to the US Treasury; bringing to bear experience gained through the Italian auto giant's own restructuring. Overnight, Chrysler gets access to a range of small, fuel-efficient cars that are nothing like what is currently offered in Pentastar showrooms. Fiat's engineering will be ported over to some Chrysler manufacturing sites, keeping the plants busy and offering both brands ample capacity for the parts they will need to build cars.

For its efforts, Fiat will get a 35 percent equity interest in Chrysler and a way for the Italian automaker to re-enter the American market incognito by lending Chrysler the small, efficient cars it's sorely lacking. The partnership will go the other way, as well, with Chrysler vehicles gaining access to other markets through Fiat's distribution muscle. The UAW is on board, as are CEOs Marchionne and Nardelli. It's far more exciting to think of the vehicles that might come this way from Fiat, but who knows, maybe some market, somewhere, will discover it can't get enough of the Sebring. Press release after the jump.

[Source: Chrysler]

Continue reading BREAKING: Chrysler and Fiat announce partnership

BREAKING: Chrysler and Fiat announce partnership originally appeared on Autoblog on Tue, 20 Jan 2009 07:31:00 EST. Please see our terms for use of feeds.

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