Chrysler Forms Alliance with Fiat (No, Really!)
Date 2009/1/20 7:47:08 | Topic: Miscellaneous
|In the way-out-of-left-field departments, Chrysler LLC and Fiat Group announced this morning a "global strategic alliance" - aimed at keeping Chrysler viable and giving Fiat a toe-hold in the American auto market (or what's left of it). |
The deal gives Chrysler access to Fiat's technology (pizza-powered cars? [since I'm of Italian decent, I'm allowed to say this]) as well as Fiat's management services. In exchange, Fiat gets easy access to the North American market. The most interesting part of the deal is that Fiat gets 35% of Chrysler for nothing. Nada. Zip. Zilch.
From the Chrysler blog:
The alliance, to be a key element of Chryslerís viability plan, would provide Chrysler with access to competitive, fuel-efficient vehicle platforms, powertrain, and components to be produced at Chrysler manufacturing sites. Fiat would also provide distribution capabilities in key growth markets, as well as substantial cost savings opportunities. In addition, Fiat would provide management services supporting Chryslerís submission of a viability plan to the U.S. Treasury as required. Fiat has been very successful in executing its own restructuring over the past several years. The alliance would also allow Fiat Group and Chrysler to take advantage of each other's distribution networks and to optimize fully their respective manufacturing footprint and global supplier base.
Forbes is also covering this news - perhaps with the best headline: "Chrysler's Italian Savior" (reminds me of a cheap romance novel title - not that I ever read them).