Lots of kids on the way
First the marriage, now the family, writes KARLA PINCOTT
THE last-ditch liaison between cashstrapped Chrysler and Fiat of Italy will spark a new model splurge. The two companies are planning a major push as they look to maximise a marriage that was a necessity for Chrysler and a perfect opportunity for Fiat to move into the US.
Details of the two companies’ tie-up — which follows Chrysler’s divorce from Daimler of Germany— are being finalised, but they are talking about new opportunities.
The first is a plan for at least seven new vehicles to be built at Chrysler’s US factories.
Four of the vehicles will be branded as Chryslers. The other three are expected to be sold as Fiats or Alfa Romeos.
Fiat will reportedly supply the mechanical platforms for four of the products, but there has been no information about their design, vehicle segments or estimated launch.
However, industry insiders suggest the Fiat 500 will be produced at Chrysler’s Toluca factory after the PT Cruiser now built there is phased out late this year.
The Italian company, which has taken a 35 per cent stake in Chrysler, is expected to donate other small-car expertise.
Chrysler Australia head Gerry Jenkins admits he knows little yet of what is happening at head office.
‘‘All we know is our top executives are in talks with Fiat executives,’’ Jenkins says. ‘‘We are having correspondence with head office, but there is nothing concrete I can say at this stage.
all very excited. The Fiat agreement is a tremendous opportunity. It’s a perfect marriage and I think the prospects are absolutely outstanding.’’
Fiat’s stake in Chrysler does not involve money being handed over. The Italian involvement is being repaid by more doors being opened to international markets and shared technology.
Chrysler got a $US4 billion bailout in US Government loans this year, but was still expected to collapse without some sort of partnership or alliance, which was once rumoured to be with General Motors.
It pulled off the Fiat deal at exactly the right time, even though the Italian company is now in trouble of its own at home.
The head of Fiat warns that Italy’s automotive industry could lose 60,000 jobs — about 20 per cent of the workforce — unless the Government implements a rescue package similar to the one in the US, which has already been copied in Britain.
‘‘If the Government doesn’t intervene, the risk that 60,000 workers in the automotive sector will have to stay at home is real,’’ Fiat chief executive Sergio Marchionne told Italy’s Ansa news agency.
‘‘We are expecting measures for the entire automotive sector, which is currently selling 60 per cent less than last year. It’s not a case of helping Fiat, but of restarting an entire production sector and the whole economy.’’
Fiat has slashed production and cut its forecasts because of the global slump, and announced in January it would not pay a 2008 dividend to shareholders.