Fiat to gradually build equity in Chrysler; European products to come stateside
03/31/2009, 6:25 PM
By Andrew Ganz
Following the Obama administration’s virtual green light approval of the proposed Chrysler-Fiat merger, the Italian automaker’s top executives headed for Detroit to finalize the deal. Early reports indicate that the Italian automaker will begin with a 20 percent stake in Chrysler that could grow as high as 55 percent as certain milestones are reached.
A source familiar with the discussions between Chrysler and Fiat told the Detroit News that the milestones could include such points as the first Fiat engine being engineered for use in a Chrysler and the completion of the first shared platform.
Initially, Chrysler and Fiat had said that the Italian automaker would take a 35 percent share in Chrysler as part of a no-cash exchange of equity. Chrysler would also provide a North American distribution network for Fiat and Alfa Romeo products, while Fiat would supply Chrysler with small-displacement engines, small car platforms and an improved European distribution network.
The insider source said that it was not Fiat or Chrysler who forced the change, but rather the Obama administration’s automotive task force.
“We believe we will arrive at a result that will establish a credible future for this crucial industrial sector,” Fiat CEO Sergio Marchionne said in a statement.
European product arrival
Though it’s too early for either party to confirm which Fiat and Alfa Romeo-badged products will arrive in North America, Fiat President Luca Cordero di Montezemolo did issue a statement that should be encouraging to enthusiasts anxiously awaiting the return of the Italian automaker’s products.
“If an agreement is concluded, as we hope, in the next few weeks, it will present an extraordinary opportunity,” he said.
“Having access to a major network such as Chrysler’s, we will be able to enter the U.S. market with automobiles, which we are sure will be appreciated for their innovative content, style and advanced technology. Despite the difficult period it is currently experiencing, the U.S. market still remains the greatest opportunity and challenge.”



03/31, 6:40 PM
posted by:
JakeK66
I just took a look at the Fiats on their website. Their is nothing on there to get excited about. They all look rather dated and not built that well. Kind of look like old Kias to be honest. My mom owned a Fiat back when they used to be here and said that her dad ripped the door handle off simply trying to open the door.
I like the Alfa brand though, they have some nice product, very pricey though.
What happens to the Ferrari brand? Will they make Ferrari edition Calibers?
03/31, 6:56 PM
posted by:
johnnycanuck
I don’t give a sh*t what they bring over just get the deal signed, sealed and delivered so that Chrysler can move forward without that dark cloud hanging overhead. And if Cerberus does flock off as promised that’s just a bonus.
03/31, 7:03 PM
posted by:
SomeGreek
So, Jake you’ve tried Fiat’s models through the net… Weren’t that good huh?
03/31, 7:17 PM
posted by:
A4
all i want to see here is:
BRERA, MITO, 159
03/31, 7:43 PM
posted by:
save saab
Don’t forget the Milano (147 replacement). They really need to get Alfa and Fiat back here.
03/31, 7:47 PM
posted by:
Lariat Luxury Locomotive Liner No.3
If they come back, they had better be a thousand times better than when they left. Because they s-u-c-k-e-d!
03/31, 7:54 PM
posted by:
05Z88Path
I wouldn’t mind having an Alfa 8C Competizione in my garage. Much better then any Chrysler car currently on the market with exception to the Viper…
03/31, 7:59 PM
posted by:
TomF
I worked with a guy who owned an orange ‘79 Strada. Ah-HA-hah-ha-ha-ha.
03/31, 8:43 PM
posted by:
ootlink
The car in that picture, AFAIK is going to be sold here as the Sebring’s replacement
03/31, 9:04 PM
posted by:
RaineMan
So they’re gonna throw a Fiat front end on the Sebring and try to sell it as something new? Come on… please. You just know they’re gonna try some of that.
03/31, 9:39 PM
posted by:
parts guy
Agreed 100% Johnny!
03/31, 9:45 PM
posted by:
Borat
Those who drove FIAT 500 (circa 2008) can tell that it a great little car. Alfa Romeo great (European) family car to drive (at least the one I drove with diesel motor and torque of a V6). FIAT made huge strides in small engine development. Ford sources small engines for its European cars, but they are too small for US. Maserati and Ferrari nothing to cry about, if you can afford one. Of course if you can afford one, the cost of maintenance is least of your concerns and most of us on this blog probably can’t understand this (I feel your pain people).
The bottom line Johnny is right: if it saves the company and few jobs that still left on N.A. continent great (including call center that moved back from India and will go right back if FIAT takes over: Tata is on the board of directors of FIAT).
03/31, 11:12 PM
posted by:
Blakkarr
Borat,
FIAT is an insane car company that might scare some Japanese import fans. But more over we’ll have to see what shakes out of all this. But the 500 would be an interesting foil to the almost ubiquitous Mini Cooper.
I would have been surprised is PEUGEOT jumped in on this. Maybe not if it happens later and they ultimately take CHRYSLER to be their manufacturing provider int he US. Add to this the CHRYSLER will be building the next Nissan TITAN, and that CHRYSLER really is making really good cars now, if it is bigger than a Sebring/ Avenger, and I think CHRYSLER stands so kind of a chance.
I still wouldn’t place money on in until after APRIL.
03/31, 11:20 PM
posted by:
Get Real
A repair shop orgasim is coming when Fiat docks that first ship at a US port.
03/31, 11:53 PM
posted by:
johnnycanuck
Get Real, you never know, I think North America would appreciate anything that came right now without shooting blanks.
04/01, 12:55 AM
posted by:
tripleonefive
This is GREAT! …..for repair shops They are going to be making a lot of money Two ****ty car companies get together and make even ****tier cars I love america
04/01, 4:49 AM
posted by:
Tony UK
As Borat says, Ratan Tata is on the board of FIAT, and as i’m sure you’ll know Tata own Jaguar Land Rover. If this deal expands to its fullest point, FIAT/Alfa could well have access to Jaguar platforms, Jeep to Land Rover technology (and vice versa I guess, though why they’d need to learn from Jeep I dont know). Fiat are even providing finance to JLR!
~~~~
In July 2008, Fiat Group Automobiles Financial Services (FGAFS) signed an agreement with Jaguar Land Rover for the provision of a full range of retail and wholesale auto financial services to Jaguar Land Rovers’ (JLR’s) dealers and customers in its main European markets. Formal integration is due to take place on 1st April 2009, and the need for a smooth transition is paramount. Any delays in meeting the deadline for integration would present significant operational, financial and reputational risks for both organisations.
~~~~
Now how do you make a catchy name out of JLRFALFCJD (initials of all those brands) ?
04/01, 5:09 AM
posted by:
SomeGreek
Sharing platforms and engines is not as simple as you present it. Fiat has nothing to give to Chrysler at the moment apart from mechanical parts for city cars. This means two things:
1. They won’t have any help at renewing their basic range of models which is the most immediate need
2. It will take much time until they make use of those parts to build city cars that at the botom end will have to compete Fiat’s! At the same time Fiat will be selling some cars and maybe even working on their replacements…
I don’t see how Chrysler will get profit out of this deal any time soon.
04/01, 5:15 AM
posted by:
Veda
Alfa Romeo offerings do look better than Chrysler’s. Plus there’s always a need to buy Italians. So it’s all for the better really. Well except for Chrysler in which they’ll exist in name only.
04/01, 9:11 AM
posted by:
Poisnonous Cinquecento
Love idiots like Jake who judge Fiat on their 70s cars.Dont understand the world have moved 30 years in future and sure technology does too.
PPL who love cars love italian cars..nuff said…even Clarkson said it.
04/01, 9:55 AM
posted by:
Payton Byrd
@PC
I want to agree, but I cannot. If we still judged cars by their 70’s equivalent then we’d expect all Toyotas to be small, bland and efficient. All Hondas would be small, quirky and efficient. All Datsuns (I mean Nissans) to be small, poorly built and efficient, and finally all Mazdas to be small, sporty and not quite so efficient.
We’d expect all Mercedes to be large, luxurious and thirsty (except the diesels), We’d expect all BMW’s to be small (for their segment), sporty and inefficient. We’d expect all Ferrari’s to be exotic, sporting and expensive. We’d expect all Porches to resemble a Beetle, just faster and more expensive.
We’d expect all Chryslers to be huge bits of rolling junk with quirky styling. We’d expect all Chevy’s to be a blend of not-quite-small enough for its segment, powerful for its segment, but not the best quality in its segment. We’d expect all Fords to be provided with weird noses, too much chrome and a penchant to be underpowered compared to competitors.
Now, let’s look at today:
1) Toyota – Same, except now has some people-sized cars and trucks.
Porsche – Is as it ever was.
2) Honda – Same, except now has some people-sized cars.
3) Datsun (Nissan) – Is as it ever was.
4) Mazda – Is as it ever was.
5) Mercedes – Is as it ever was.
6) BMW – Same, except now has some larger cars.
7) Ferrari – Is as it ever was.
10) Chrysler – Same, but with slightly better quality.
11) Chevy – Is as it ever was.
12) Ford – Holy crap! A car company changed everything. Ford’s are now stylish, reliable, inexpensive to operate and powerful. Who’da thunk it?
So, out of 12 brands we have one true convert, seven that haven’t changed a bit, and four that have evolved… slightly.
Unless Fiat has pulled a Ford out of its hat, we expect roughly the same as we got in the 1970’s.
04/01, 9:56 AM
posted by:
terk184
I was in Europe (Sweden, Denmark) July of 08 and rented a 500. Small by our standards but well screwed together, high content and interior quality, and fun to drive. If it is an example of Fiat/Alfa quality/technology this will bode well for Chrysler and their products should find a welcome audience.
04/01, 10:12 AM
posted by:
Thunder Chicken
..and the really funny thing is that this is the company that a few years ago GM paid $2 billion to, just to get out of buying it…
04/01, 10:52 AM
posted by:
DCG3
when alfa is back ill be first in line for the 159Q4V6
04/01, 12:54 PM
posted by:
Impulsive
Dear Lord, do NOT let them bring that pathetic beak.
04/01, 1:05 PM
posted by:
yarddog82abn
Well they don’t have a chose do they?
04/01, 6:22 PM
posted by:
zoomzoomer
Here’s the first one..
http://www.geocities.com/aut0nutt/Chrysler159.jpg
04/01, 10:43 PM
posted by:
benroethig
The more I see of this plan, the less it makes sense. As far as I can can tell, neither want to put up much money to develop new products, so the current plan is to save Chrysler by letting them rebadge Fiat’s hatches and sell them in the U.S. market which despises hatchbacks. Huh? This is sort of akin to Chrysler helping out some European carmaker by letting them sell the Ram in Europe.