Chrysler, Fiat discuss partnership
01-19-2009, 03:44 PM
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Chrysler, Fiat discuss partnership
AUBURN HILLS, Mich. – Fiat SpA is holding discussions with Chrysler LLC about taking a stake in the U.S. car maker and creating a partnership that would allow the Italian auto maker to build and sell its small cars in the United States, two publications reported Monday.
Unnamed officials familiar with the discussions told The Wall Street Journal and Automotive News that Chrysler would have access to the Turin-based automaker's engine and transmission technology as part of a potential deal.
Chrysler spokeswoman Lori McTavish said in a statement Monday that "in today's economic environment, talks are going on between companies in all industries — ours is no different." McTavish said Chrysler as a policy "does not confirm or disclose the nature of its private business meetings."
A Fiat official did not immediately comment on the reports.
Fiat Group SpA, which makes Fiat, Lancia and Alfa Romeo vehicles, has been trying to re-enter the United States for the first time since 1983. The company has expressed interest in bringing its Fiat 500 compact car and the Alfa Romeo brand to the U.S. market.
Chrysler, which is 80.1 percent owned by Cerberus Capital Management LLP, has been hurt by its reliance upon slow-selling trucks and sport utility vehicles and analysts have said it probably won't survive the year as an independent company despite receiving a $4 billion government loan.
The Treasury Department said Friday it will provide a $1.5 billion loan to Chrysler's financing arm, Chrysler Financial, and the automaker plans to offer zero-percent financing on several models and expand lending to car buyers with less than ideal credit.
Unnamed officials familiar with the discussions told The Wall Street Journal and Automotive News that Chrysler would have access to the Turin-based automaker's engine and transmission technology as part of a potential deal.
Chrysler spokeswoman Lori McTavish said in a statement Monday that "in today's economic environment, talks are going on between companies in all industries — ours is no different." McTavish said Chrysler as a policy "does not confirm or disclose the nature of its private business meetings."
A Fiat official did not immediately comment on the reports.
Fiat Group SpA, which makes Fiat, Lancia and Alfa Romeo vehicles, has been trying to re-enter the United States for the first time since 1983. The company has expressed interest in bringing its Fiat 500 compact car and the Alfa Romeo brand to the U.S. market.
Chrysler, which is 80.1 percent owned by Cerberus Capital Management LLP, has been hurt by its reliance upon slow-selling trucks and sport utility vehicles and analysts have said it probably won't survive the year as an independent company despite receiving a $4 billion government loan.
The Treasury Department said Friday it will provide a $1.5 billion loan to Chrysler's financing arm, Chrysler Financial, and the automaker plans to offer zero-percent financing on several models and expand lending to car buyers with less than ideal credit.
01-20-2009, 08:28 AM
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AP
Fiat and Chrysler sign alliance plan
Tuesday January 20, 7:52 am ET
By Ariel David, Associated Press Writer
Fiat to take 35 percent stake in struggling Chrysler under nonbinding strategic alliance plan
ROME (AP) -- Fiat and Chrysler said Tuesday they have signed a nonbinding agreement for a strategic alliance that would give the Italian auto empire a 35-percent stake in the troubled U.S. carmaker.
The two companies said in a joint statement they would share technologies and vehicle platforms. Under the proposed alliance, Fiat would not invest cash in Chrysler but would provide access to its successful small-car platforms, as well as to its more environmentally friendly and fuel-efficient engines.
The statement said Fiat would take an "initial" 35-percent stake, suggesting the deal may be broadened. It stressed that under the agreement the company is not committing to funding Chrysler in the future.
For Chrysler, based in Auburn Hills, Michigan, the deal would mean breaking out of the North American market and gaining access to more competitive products.
"A Chrysler-Fiat partnership is a great fit as it creates the potential for a powerful, new global competitor, offering Chrysler a number of strategic benefits, including access to products that complement our current portfolio (and) a distribution network outside North America," said Bob Nardelli, Chairman and CEO of Chrysler LLC.
Fiat Group SpA, which makes Fiat, Lancia and Alfa Romeo vehicles, is trying to re-enter the United States market. The company has expressed interest in bringing its Fiat 500 compact car and the Alfa Romeo brand to the U.S.
The alliance is subject to a review of company finances and regulatory approvals, including by the U.S. Treasury Department, which last week announced an emergency bridge loan for Chrysler, which analysts say will have difficulty surviving as an independent company.
"This initiative represents a key milestone in the rapidly changing landscape of the automotive sector," said Fiat CEO Sergio Marchionne.
"The agreement will offer both companies opportunities to gain access to most relevant automotive markets with innovative and environmentally friendly product offering, a field in which Fiat is a recognized world leader, while benefiting from additional cost synergies," he said.
Chrysler, which is 80.1 percent owned by Cerberus Capital Management LLP, has been hurt by its reliance upon slow-selling trucks and sport utility vehicles and analysts have said it may not survive the year as an independent company despite receiving the $4 billion government loan.
The Treasury Department said Friday it will provide a $1.5 billion loan to Chrysler's financing arm, Chrysler Financial, and the automaker plans to offer zero-percent financing on several models and expand lending to car buyers with less than ideal credit.
Nardelli said the partnership would provide a return for taxpayers on the loan, "securing long-term viability of Chrysler brands," boosting consumer confidence and "preserving American jobs."
Fiat and Chrysler sign alliance plan
Tuesday January 20, 7:52 am ET
By Ariel David, Associated Press Writer
Fiat to take 35 percent stake in struggling Chrysler under nonbinding strategic alliance plan
ROME (AP) -- Fiat and Chrysler said Tuesday they have signed a nonbinding agreement for a strategic alliance that would give the Italian auto empire a 35-percent stake in the troubled U.S. carmaker.
The two companies said in a joint statement they would share technologies and vehicle platforms. Under the proposed alliance, Fiat would not invest cash in Chrysler but would provide access to its successful small-car platforms, as well as to its more environmentally friendly and fuel-efficient engines.
The statement said Fiat would take an "initial" 35-percent stake, suggesting the deal may be broadened. It stressed that under the agreement the company is not committing to funding Chrysler in the future.
For Chrysler, based in Auburn Hills, Michigan, the deal would mean breaking out of the North American market and gaining access to more competitive products.
"A Chrysler-Fiat partnership is a great fit as it creates the potential for a powerful, new global competitor, offering Chrysler a number of strategic benefits, including access to products that complement our current portfolio (and) a distribution network outside North America," said Bob Nardelli, Chairman and CEO of Chrysler LLC.
Fiat Group SpA, which makes Fiat, Lancia and Alfa Romeo vehicles, is trying to re-enter the United States market. The company has expressed interest in bringing its Fiat 500 compact car and the Alfa Romeo brand to the U.S.
The alliance is subject to a review of company finances and regulatory approvals, including by the U.S. Treasury Department, which last week announced an emergency bridge loan for Chrysler, which analysts say will have difficulty surviving as an independent company.
"This initiative represents a key milestone in the rapidly changing landscape of the automotive sector," said Fiat CEO Sergio Marchionne.
"The agreement will offer both companies opportunities to gain access to most relevant automotive markets with innovative and environmentally friendly product offering, a field in which Fiat is a recognized world leader, while benefiting from additional cost synergies," he said.
Chrysler, which is 80.1 percent owned by Cerberus Capital Management LLP, has been hurt by its reliance upon slow-selling trucks and sport utility vehicles and analysts have said it may not survive the year as an independent company despite receiving the $4 billion government loan.
The Treasury Department said Friday it will provide a $1.5 billion loan to Chrysler's financing arm, Chrysler Financial, and the automaker plans to offer zero-percent financing on several models and expand lending to car buyers with less than ideal credit.
Nardelli said the partnership would provide a return for taxpayers on the loan, "securing long-term viability of Chrysler brands," boosting consumer confidence and "preserving American jobs."
01-20-2009, 11:48 AM
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that was funny... I can see it on Top Gear now 
01-20-2009, 05:04 PM
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La Grande Bugia
By Robert Farago
January 20, 2009
Breaking news: Fiat has just signed a “non-binding term sheet” with ChryCo. The Italian automaker will acquire a 35 percent interest in Chrysler for… nothing. No cash. No assets. Niente. And yet the Chrysler - Fiat deal comes complete with the United Auto Workers’ (UAW) blessing. It’s a nice thought: a global alliance to pull Chrysler’s fat from the fire, save the taxpayer’s bacon and uncook the UAW’s golden goose. But there’s zero chance of Fiat riding to the rescue of Chrysler. It’s just another part of Chrysler’s Big Lie.
Adolph Hitler said The Big Lie was effective because most people “would not believe that others could have the impudence to distort the truth so infamously. Even though the facts which prove this to be so may be brought clearly to their minds, they will still doubt and waver and will continue to think that there may be some other explanation.” In this case, the lie is the idea that Chrysler is a viable automaker.
The fact that the company is utterly bankrupt without any chance of recovery is, obviously, besides the point. As long as there is hope that Chrysler has a future, the general public and their fear-mongering elected representatives will cling to the fiction that Chrysler can– indeed should– continue to exist.
To perpetuate that myth, to protect its federal lifeline, Chrysler must generate plausible possibility. Hence the stream of “news” coming out of Auburn Hills in recent weeks. Canada’s Magna Corporation may purchase Chrysler’s minivan plant. Nissan may produce a small car for Chrysler, and rebadge Dodge Ram pick-up trucks as Titans. A Chinese carmaker may buy unwanted (not to say unused) tooling for the soon-to-dead PT Cruiser. And now… Fiat buys into Chrysler.
In reality, Magna may want Chrysler’s Windsor minivan plant, but the company isn’t stupid enough to pay anything for it. Not when they can pick it up for pennies on the dollar after ChryCo’s collapse. In reality, Nissan is in deep trouble; it’s not going to build anything for Chrysler without [non-existent] cash on the nail. It’s also in no position to remount an attack on a market segment that’s both crowded and cratered (just ask Toyota).
In reality, China doesn’t need the PT Cruiser. And in reality, the Fiat deal has nothing to offer. Without any cash investment by the Italian automaker, without a single production-ready Italian vehicle on the horizon to lure Americans into empty, abandoned Chrysler showrooms, this non-deal does nothing whatsoever to ensure Chrysler’s long term viability.
The underlying causation for this non-news is simple enough. Lipstick. Pig. Apply.
On February 17, Chrysler will present their term paper to Congress: “How I Spent Uncle Sam’s $4b” (a.k.a. “The Three Headed Dog Ate my Automaker”). Chrysler’s representatives will attempt to prove that the company can [now] be restructured and resurrected to live a long, happy life. See? Things are happening! We’re building for the future!
Of course, Chrysler’s “business plan” was, is and will be complete BS.
CEO Bob Nardelli knew Chrysler was doomed to the dole back in December, back when he told Congress his employer could turnaround Chrysler’s fortunes with “just” $7b worth of federal loans. As is the way of such things, that was then. This is now. By mid-February, Boot ‘em Bob’s boys will unveil phase II of their grand plan for Chrysler’s renaissance: get out of the manufacturing business.
The new plan is the same as the original plan: keep the brands and distribution network. Sell vehicles made by others rebadged as Chryslers. Limited capital and engineering required.
Meanwhile and in any case, Chrysler needs the same lifeblood as any other going enterprise: cash. Badge engineering and branding be damned; new car sales aren’t going to provide Chrysler with the funds it needs to sustain its operations and pay for its ongoing liabilities. Not now. Not later. Most likely, never. Asset sales won’t do the job, either. And Fiat’s sure as Hell not providing operational liquidity.
Blow away the smoke, pack away the mirrors, allow owner Cerberus to insulate themselves from accountability for their actions, and it’s clear that Chrysler has one source– and one source only– of cash: the U.S. taxpayer.
As any good politician knows, to fool some of the people all of the time, you need to change your story frequently. In other words, The Big Lie must be sustained by a steady diet of big ideas.
When it comes to Chrysler’s ongoing call on the public purse, the biggest of these is the Chrysler - GM merger. The concept: forget Chrysler and GM. We need to save American manufacturing! This American Leyland strategy is a stupendously bad plan which would make The General like Citibank: a company too big to fail with operating divisions that can never be properly integrated.
Which is exactly why it’ll happen.
http://www.thetruthaboutcars.com/edi...-grande-bugia/
By Robert Farago
January 20, 2009
Breaking news: Fiat has just signed a “non-binding term sheet” with ChryCo. The Italian automaker will acquire a 35 percent interest in Chrysler for… nothing. No cash. No assets. Niente. And yet the Chrysler - Fiat deal comes complete with the United Auto Workers’ (UAW) blessing. It’s a nice thought: a global alliance to pull Chrysler’s fat from the fire, save the taxpayer’s bacon and uncook the UAW’s golden goose. But there’s zero chance of Fiat riding to the rescue of Chrysler. It’s just another part of Chrysler’s Big Lie.
Adolph Hitler said The Big Lie was effective because most people “would not believe that others could have the impudence to distort the truth so infamously. Even though the facts which prove this to be so may be brought clearly to their minds, they will still doubt and waver and will continue to think that there may be some other explanation.” In this case, the lie is the idea that Chrysler is a viable automaker.
The fact that the company is utterly bankrupt without any chance of recovery is, obviously, besides the point. As long as there is hope that Chrysler has a future, the general public and their fear-mongering elected representatives will cling to the fiction that Chrysler can– indeed should– continue to exist.
To perpetuate that myth, to protect its federal lifeline, Chrysler must generate plausible possibility. Hence the stream of “news” coming out of Auburn Hills in recent weeks. Canada’s Magna Corporation may purchase Chrysler’s minivan plant. Nissan may produce a small car for Chrysler, and rebadge Dodge Ram pick-up trucks as Titans. A Chinese carmaker may buy unwanted (not to say unused) tooling for the soon-to-dead PT Cruiser. And now… Fiat buys into Chrysler.
In reality, Magna may want Chrysler’s Windsor minivan plant, but the company isn’t stupid enough to pay anything for it. Not when they can pick it up for pennies on the dollar after ChryCo’s collapse. In reality, Nissan is in deep trouble; it’s not going to build anything for Chrysler without [non-existent] cash on the nail. It’s also in no position to remount an attack on a market segment that’s both crowded and cratered (just ask Toyota).
In reality, China doesn’t need the PT Cruiser. And in reality, the Fiat deal has nothing to offer. Without any cash investment by the Italian automaker, without a single production-ready Italian vehicle on the horizon to lure Americans into empty, abandoned Chrysler showrooms, this non-deal does nothing whatsoever to ensure Chrysler’s long term viability.
The underlying causation for this non-news is simple enough. Lipstick. Pig. Apply.
On February 17, Chrysler will present their term paper to Congress: “How I Spent Uncle Sam’s $4b” (a.k.a. “The Three Headed Dog Ate my Automaker”). Chrysler’s representatives will attempt to prove that the company can [now] be restructured and resurrected to live a long, happy life. See? Things are happening! We’re building for the future!
Of course, Chrysler’s “business plan” was, is and will be complete BS.
CEO Bob Nardelli knew Chrysler was doomed to the dole back in December, back when he told Congress his employer could turnaround Chrysler’s fortunes with “just” $7b worth of federal loans. As is the way of such things, that was then. This is now. By mid-February, Boot ‘em Bob’s boys will unveil phase II of their grand plan for Chrysler’s renaissance: get out of the manufacturing business.
The new plan is the same as the original plan: keep the brands and distribution network. Sell vehicles made by others rebadged as Chryslers. Limited capital and engineering required.
Meanwhile and in any case, Chrysler needs the same lifeblood as any other going enterprise: cash. Badge engineering and branding be damned; new car sales aren’t going to provide Chrysler with the funds it needs to sustain its operations and pay for its ongoing liabilities. Not now. Not later. Most likely, never. Asset sales won’t do the job, either. And Fiat’s sure as Hell not providing operational liquidity.
Blow away the smoke, pack away the mirrors, allow owner Cerberus to insulate themselves from accountability for their actions, and it’s clear that Chrysler has one source– and one source only– of cash: the U.S. taxpayer.
As any good politician knows, to fool some of the people all of the time, you need to change your story frequently. In other words, The Big Lie must be sustained by a steady diet of big ideas.
When it comes to Chrysler’s ongoing call on the public purse, the biggest of these is the Chrysler - GM merger. The concept: forget Chrysler and GM. We need to save American manufacturing! This American Leyland strategy is a stupendously bad plan which would make The General like Citibank: a company too big to fail with operating divisions that can never be properly integrated.
Which is exactly why it’ll happen.
http://www.thetruthaboutcars.com/edi...-grande-bugia/
01-20-2009, 11:55 PM
#14
Chrysler saved itself before with a government loan and rebadging another company's cars (Mitsubishi). It looks like they are going to try it again. The first guy that did it now complains that the Japanese have taken over the US auto market. In another decade are we going to hear that the Italians are taking over the US car market too? Good job doing the same thing you did last time Chrysler.