Fiat buys 35% of Chrysler.....for $0 !!
01-20-2009, 02:27 PM
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Fiat buys 35% of Chrysler.....for $0 !!
anyone else see something wrong with this???
Fiat Buys American, And Gets A Great Price
Fiat Buys American, And Gets A Great Price
Detroit -
Fiat Group Chief Executive Sergio Marchionne has proved himself to be a shrewd negotiator. In 2004, he forced General Motors to pay $2 billion to extricate itself from a failed alliance with the Italian carmaker--money he used as the foundation to begin Fiat's remarkable turnaround.
Now he has managed to obtain free access to the highly competitive U.S. market without laying out a dime. Fiat will acquire a 35% stake in ailing Chrysler from Cerberus Capital Management, but will not pay anything for it and will not commit to funding Chrysler in the future.
Instead, Fiat will provide Chrysler with important small vehicles and fuel-efficient powertrains to be produced at Chrysler factories, as well as distribution opportunities in key growth markets outside the U.S., where Chrysler is weak.
In exchange, Fiat gains U.S. manufacturing capacity for its small cars and access to Chrysler's dealer network. Full details weren't immediately available, however.
Like Chrysler, Fiat is a relatively small automaker that is heavily dependent on its home market. Marchionne, who has been looking for a cost-effective way to bring its small cars and premium Alfa Romeo brand to the U.S. market for some time, has been vocal about Fiat's need to find a strategic partner to survive.
"This initiative represents a key milestone in the rapidly changing landscape of the automotive sector and confirms Fiat and Chrysler's commitment and determination to continue to play a significant role in this global process,” Marchionne said.
For struggling Chrysler, which received a $4 billion emergency loan from the U.S. Treasury Department earlier this month, the alliance with Fiat represents a last-ditch rescue attempt. The company is facing a Feb. 17 deadline to submit a restructuring plan to the Obama administration, outlining how it will become viable by March 31. Chrysler said Fiat management will help it devise the plan. The alliance must be approved by the Treasury Department, among others.
Chrysler Chief Executive Robert Nardelli called the Chrysler-Fiat partnership "a great fit," creating the potential for "a powerful, new global competitor." Nardelli added, "The partnership would also provide a return on investment for the American taxpayer by securing the long-term viability of Chrysler brands in the marketplace, sustaining future product and technology development for our country and building renewed consumer confidence, while preserving American jobs."
The United Auto Workers union, which has lost thousands of jobs amid a drastic downsizing of the U.S. auto industry, was elated by the prospect of extending Chrysler's life. "As the U.S. auto industry undergoes a restructuring process, this alliance has the potential to preserve a wide range of choices for U.S. consumers, as well as good-paying manufacturing jobs for our communities," said UAW President Ronald Gettelfinger.
Fiat Group Chief Executive Sergio Marchionne has proved himself to be a shrewd negotiator. In 2004, he forced General Motors to pay $2 billion to extricate itself from a failed alliance with the Italian carmaker--money he used as the foundation to begin Fiat's remarkable turnaround.
Now he has managed to obtain free access to the highly competitive U.S. market without laying out a dime. Fiat will acquire a 35% stake in ailing Chrysler from Cerberus Capital Management, but will not pay anything for it and will not commit to funding Chrysler in the future.
Instead, Fiat will provide Chrysler with important small vehicles and fuel-efficient powertrains to be produced at Chrysler factories, as well as distribution opportunities in key growth markets outside the U.S., where Chrysler is weak.
In exchange, Fiat gains U.S. manufacturing capacity for its small cars and access to Chrysler's dealer network. Full details weren't immediately available, however.
Like Chrysler, Fiat is a relatively small automaker that is heavily dependent on its home market. Marchionne, who has been looking for a cost-effective way to bring its small cars and premium Alfa Romeo brand to the U.S. market for some time, has been vocal about Fiat's need to find a strategic partner to survive.
"This initiative represents a key milestone in the rapidly changing landscape of the automotive sector and confirms Fiat and Chrysler's commitment and determination to continue to play a significant role in this global process,” Marchionne said.
For struggling Chrysler, which received a $4 billion emergency loan from the U.S. Treasury Department earlier this month, the alliance with Fiat represents a last-ditch rescue attempt. The company is facing a Feb. 17 deadline to submit a restructuring plan to the Obama administration, outlining how it will become viable by March 31. Chrysler said Fiat management will help it devise the plan. The alliance must be approved by the Treasury Department, among others.
Chrysler Chief Executive Robert Nardelli called the Chrysler-Fiat partnership "a great fit," creating the potential for "a powerful, new global competitor." Nardelli added, "The partnership would also provide a return on investment for the American taxpayer by securing the long-term viability of Chrysler brands in the marketplace, sustaining future product and technology development for our country and building renewed consumer confidence, while preserving American jobs."
The United Auto Workers union, which has lost thousands of jobs amid a drastic downsizing of the U.S. auto industry, was elated by the prospect of extending Chrysler's life. "As the U.S. auto industry undergoes a restructuring process, this alliance has the potential to preserve a wide range of choices for U.S. consumers, as well as good-paying manufacturing jobs for our communities," said UAW President Ronald Gettelfinger.
01-20-2009, 03:02 PM
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Well, Fiat's current CEO brought that company back from the edge of collapse a few years ago.... could this situation really be any worse that letting the same incompetent management continue to run Chrysler into the ground using our tax dollars?
01-20-2009, 06:17 PM
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Keep in mind though that they also still get the liability of paying them back (since it was a loan). All in all I think this is great. It will be cool to see Alfa Remaro's competing in the lux catagory here in the states!
01-20-2009, 06:19 PM
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^^^ reminds me of a Top Gear episode I saw recently with Alfas. 
01-21-2009, 01:26 AM
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Congress still has to approve the plans to invest the money. It's not like they're going to use your tax dollars to buy everyone at the factory in Italy a diamond-encrusted back scratcher. Do you honestly think it's a better idea to leave the fate of Chrysler in the hands of the current incompetents who have all but mismanaged the company out of existence?
01-21-2009, 03:43 AM
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01-21-2009, 03:50 AM
#11
Marchionne is not a stupid manager. In the last 4 years the number of Fiat cars we meet in the streets increased by a good amount and the overall quality of the vehicles is "good" while before the change they were crappy to say the least.
Having a new series of city cars that don't waste as much fuel as other bigger models and that can be bought for cheap could really save the american company by expanding it's model range.
That is, by far, a smart move. Now we have to see how they keep it on!
Having a new series of city cars that don't waste as much fuel as other bigger models and that can be bought for cheap could really save the american company by expanding it's model range.
That is, by far, a smart move. Now we have to see how they keep it on!
01-21-2009, 06:46 AM
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Fiat has some very very good small car engines, both in diesel and in gasoline. I think Chrysler will look to putting Fiat's engines into the their vehicles to begin with - though I doubt if that will help improve Chrysler's build quality.. I think this is a good deal, however. The money that is being put into Chrysler is hardly going to Fiat - I am sure there will be riders that the cash has to be invested in retooling American factories etc.
If this deal survives the coming year, perhaps Chrysler-Fiat might actually be a significant player in the international market. Or, sadly and more likely, it will end the way of the Daimler-Chrysler merger..
If this deal survives the coming year, perhaps Chrysler-Fiat might actually be a significant player in the international market. Or, sadly and more likely, it will end the way of the Daimler-Chrysler merger..
01-21-2009, 03:56 PM
#15
i think this is a good fit.
chrysler gets the R&D for small cars without paying for it. fiat gets access to the usa. chrysler gets to live. the americans get access to alfa romeos.
its like win win win. and how did fiat get any of our taxpayer money? chrysler didnt pay them to do this.
chrysler gets the R&D for small cars without paying for it. fiat gets access to the usa. chrysler gets to live. the americans get access to alfa romeos.
its like win win win. and how did fiat get any of our taxpayer money? chrysler didnt pay them to do this.
01-29-2009, 11:27 PM
#16
LOL, where they try to find the location but can't because 1. torn down or 2. bought by another car manufacturer.
I don't know why our Govt wants so much to have the "Big 3" ?
This cannot be an easy time for our president.
<------WHEEEEEEEEEEE
I don't know why our Govt wants so much to have the "Big 3" ?
This cannot be an easy time for our president.
<------WHEEEEEEEEEEE
01-30-2009, 12:35 AM
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Fiat is quite large...and very diverse...
http://en.wikipedia.org/wiki/Fiat
Impressive.
Sergio Marchionne is also a Canadian citizen (dual with Italian citizenship)!
http://en.wikipedia.org/wiki/Fiat
Impressive.
Sergio Marchionne is also a Canadian citizen (dual with Italian citizenship)!
Last edited by Daemos; 01-30-2009 at 12:38 AM.
01-30-2009, 03:49 AM
#19
So, talking seriously and without any intention to offend you this could really save Chrysler.
I'm not putting the problems that fiat is having with bad sales due to the economy in now but consider this:
You are a big country with big roads, hence the cars are bigger, in any way (chassis and engine). You also don't know how to make good engines, for bigger is not better for pollution\emissions etc.
Now you may reply that your ford focus has only got a 2.0l duratec engine. Well, we also have 1.6l engines Focus here
On the other side, here in europe we don't have big roads and big open spaces, that's why we built our automotive industry around this.
Small cars with engines as small as 1l that easily do 25 km\l . Fiat has got the cleanest vehicle lineup in europe too, so i really think that this will help a bit.
Chevrolet bought daewoo years ago to enter our market actively!
I hope this makes sense because i understand that i put it in a horrible way.
01-30-2009, 09:23 AM
#20
01-30-2009, 10:09 PM
#21
Very true
Your president already said that will cut down emissions, taking back a law created but never presented under Bush, i think.
So, talking seriously and without any intention to offend you this could really save Chrysler.
I'm not putting the problems that fiat is having with bad sales due to the economy in now but consider this:
You are a big country with big roads, hence the cars are bigger, in any way (chassis and engine). You also don't know how to make good engines, for bigger is not better for pollution\emissions etc.
Now you may reply that your ford focus has only got a 2.0l duratec engine. Well, we also have 1.6l engines Focus here
On the other side, here in europe we don't have big roads and big open spaces, that's why we built our automotive industry around this.
Small cars with engines as small as 1l that easily do 25 km\l . Fiat has got the cleanest vehicle lineup in europe too, so i really think that this will help a bit.
Chevrolet bought daewoo years ago to enter our market actively!
I hope this makes sense because i understand that i put it in a horrible way.
So, talking seriously and without any intention to offend you this could really save Chrysler.
I'm not putting the problems that fiat is having with bad sales due to the economy in now but consider this:
You are a big country with big roads, hence the cars are bigger, in any way (chassis and engine). You also don't know how to make good engines, for bigger is not better for pollution\emissions etc.
Now you may reply that your ford focus has only got a 2.0l duratec engine. Well, we also have 1.6l engines Focus here
On the other side, here in europe we don't have big roads and big open spaces, that's why we built our automotive industry around this.
Small cars with engines as small as 1l that easily do 25 km\l . Fiat has got the cleanest vehicle lineup in europe too, so i really think that this will help a bit.
Chevrolet bought daewoo years ago to enter our market actively!
I hope this makes sense because i understand that i put it in a horrible way.
Makes perfect sense and no I am not offended or would be with the exception of motors made in the USA. While I can agree partially, US made motor reputation is relevant to the application and abuse upon said vehicles. That is where the engineering is different. I see this. Going toward green utopia will take many years of trial and error, starting from "scratch" and realizing what we NEED versus WANT. Yes I want to smoke tires, but can I do it with an electric motor, hydrogen powered Rotary RE, or turbocharged 1L diesel? These are the questions that possibly Fiat can complete for Dodge, the puzzle if you wish.
It should also tell us what direction Chrysler plans to travel, in it's current state of desperation. Besides 3 choices are better than 2, hang in there Chrysler!
01-30-2009, 11:46 PM
#22
This is the best thing possible, next to just letting Crapsyler die outright. Let's face it, Chrysler's cars are crap and there's no way they can survive the current economy. I give them props for the hemi, but that was back in the stone age, and things have moved on.
And, yeah, bring on the Alfas. They make a sports car enthusiast's heart skip a beat. Oh the history, if only the damn dealerships would come back here!
And, yeah, bring on the Alfas. They make a sports car enthusiast's heart skip a beat. Oh the history, if only the damn dealerships would come back here!
01-31-2009, 01:04 AM
#23
Super Moderator
Yeah, the two will fit together perfectly....
Fiat's Beautiful styling , but terrible reliability...long term.
And Chrysler's, Ugly styling, poor reliabilty...short term.
Yup, the perfect fit for another Automotive disaster....
Mercedes/Daimler failed to make it work, so I guess Fiat likes black eyes too.
Why would you invest (so called "freely" or Not) in a company (Chrysler) which has fundamental Cash Flow issues and a Labor Force Union policy that bleeds all that cash.
Until the US Auto makers address their workforce liabilities and put in place a permanent fix, all this taxpayer money is just Band-Aid treatment.
They are all hoping this financial gloom will turn around in less than 18 months, I believe more like 120 months.
Fiat's Beautiful styling , but terrible reliability...long term.
And Chrysler's, Ugly styling, poor reliabilty...short term.
Yup, the perfect fit for another Automotive disaster....
Mercedes/Daimler failed to make it work, so I guess Fiat likes black eyes too.
Why would you invest (so called "freely" or Not) in a company (Chrysler) which has fundamental Cash Flow issues and a Labor Force Union policy that bleeds all that cash.
Until the US Auto makers address their workforce liabilities and put in place a permanent fix, all this taxpayer money is just Band-Aid treatment.
They are all hoping this financial gloom will turn around in less than 18 months, I believe more like 120 months.
01-31-2009, 04:03 AM
#24
On the second sentence i agree with you.
01-31-2009, 04:57 PM
#25
Super Moderator
The first complete quote phrase is totally wrong now. I agree that in the past there were reliability issues but the new vehichle range (as well as the older one, lasted 'till the 90s) is really reliable! Trust me, who has problem simply doesn't follow correct maintenance
On the second sentence i agree with you.
On the second sentence i agree with you.
Do you want me to start quoting...
This in one example, 159 with no brakes!, January this year in Australia.
"I would just like to let everyone know about an incident which happened to me yesterday.
I own an Alfa 159 2.2 petrol. It was bought brand new in April last year. It has had 2 services one less than a month ago. I have done about 15000 kms.
Yesterday morning first thing i was driving my car and went to brake and nothing happened (my foot went to the floor), i pumped the brakes and had full brakes again. I thought this might be a bit of a glitch so drive to work with the problem not recurring on my 25km drive to work."
Yes Alfa's are much better.,,, they would want to be, but they are no where near Japanese or even Korean standards.