Fiat Acquires 35% Stake in Chrysler

[mangxema]

And the plot thickens... From NYT

DETROIT — The Italian automaker Fiat agreed on Tuesday to take a 35 percent stake in the struggling American auto company Chrysler, which was forced last month to seek a federal bailout amid fears it might not survive.
...
The agreement will allow Chrysler to use Fiat’s technology and vehicle platforms to build more fuel-efficient, small and midsize cars at its factories and sell them in North America. Fiat will give Chrysler access to distribution networks in other parts of the world, particularly Europe. The companies said they expected “substantial cost savings opportunities” but did not specify an amount.

Apparently, the union loves it.

“This is great news for the U.A.W.-Chrysler team, and we look forward to supporting and working with them to ensure Chrysler’s long-term viability,” the U.A.W.’s president, Ron Gettelfinger, said in the companies’ statement.

 

[Irish Caesar]

Because being owned by the Germans worked out so well for them.

Apparently, the union loves it.

And who could blame them? They lose the most if Chrysler goes bankrupt.

 

[Mowque]

damn, i feel stupid...

 

[Luckymoose]

Fiat is Italian, not German and Daimler still owns like a 12% stake.

 

[Irish Caesar]

Fiat is Italian, not German and Daimler still owns like a 12% stake.

It's 19.9%, according to Chrysler's website.



Edit: Was the first part of that statement for me, too?

It would have made more sense spoken. Something like "because being owned by the Germans worked out so well for them, why not try the Italians?"

 

[mangxema]

Because being owned by the Germans worked out so well for them.

True, but they really don't have much of a choice at this point.

 

[Alpine Trooper]

NO ONE at Chrysler wanted to be acquired by the Germans in the first place. Mercedes quality is horrible and while Chrysler produced profitable numbers, Daimler ate it away to cover the horrible slide Mercedes was in.

As for Fiat, the company that devours Jeep will in turn be devoured.

No company has ever survived owning Jeep but Chrysler on its own.

 

[Cutlass]

Bailout aside, I'm somewhat doubtful Chrysler will still exist in 5 years. That said, Fiat and the French automakers failed in the US market in the 70s and 80s. You can't even get their cars here since. Back then they sucked even more than the American cars. But from the reports I've seen, they have since equaled or surpassed most American cars. This may well be Fiat's bid to reenter the US market.

 

[Ramius75]

Well, will the American buy smaller car in the future ???

 

[Godwynn]

I support Western Europe taking over America.

 

[Alpine Trooper]

Well, will the American buy smaller car in the future ???

There are many small cars for sale already in North America and Chrysler makes or is involved in a decent percentage of them already.

 

[Alpine Trooper]

Bailout aside, I'm somewhat doubtful Chrysler will still exist in 5 years.

Well they just installed brand new robotics and cooling towers at the Chrysler plant here and their lifespan is between 10-15 years so I think they'll be around.

 

[Cutlass]

Well, will the American buy smaller car in the future ???

Oil prices are down now. But no one expects that to last long past the end of the recession. Gas at $4/gallon means the average size of the American car will go down quite a bit.

 

[Cutlass]

Well they just installed brand new robotics and cooling towers at the Chrysler plant here and their lifespan is between 10-15 years so I think they'll be around.

That means nothing. If a company can't pay it's bills, then it doesn't matter what it's capital stock looks like. It'll get auctioned off.

 

[silver 2039]

I think all American car companies should be sold to foreginers. Japanese, Germans, Indians, Italians etc...

 

[warpus]

Well, Daimler-Chrysler-Fiat has a certain ring to it, I guess.

 

[innonimatu]

How much was Fiat paid for it?

 

[Mise]

How much was Fiat paid for it?

Yeah, I don't really understand what Fiat has to gain from this. Car manufacturers are in a hell of a bind all around the world, not just in America. It doesn't make sense for me that Fiat would take on Chrysler's headache when they have their own headaches to deal with.

The deal at least shows that Chrysler is worthless. I just wonder how much less than nothing it's worth now.

 

[JerichoHill]

Congrats to Fiat for buying the worst of the three car companies. I have no idea why they'd want to. Their press release is full of bs generalities.

 

[Shekwan]

There are many small cars for sale already in North America and Chrysler makes or is involved in a decent percentage of them already.

That doesn't mean Americans buy them.