Chinese automaker reportedly bids for Fiat Chrysler
A Chinese automaker reportedly made a quiet bid to acquire Fiat Chrysler Automobiles, raising the distinct possibility that the traditional member of the Detroit Three that was bailed out by U.S. taxpayers could wind up with Chinese ownership.
After years of pursuing a deal to gain greater global scale, the automaker recently rejected an acquisition bid by an unidentified Chinese company, according to Automotive News. Fiat Chrysler is based in London, with its major operations in Italy and the U.S.
The publication also reported that multiple Chinese automakers are weighing a similar bid for the maker of the Jeep, Ram, Chrysler and Dodge brands.
A Fiat Chrysler spokeswoman declined to comment Monday morning.
But investors were heartened by the prospect of a deal. Fiat Chrysler shares closed up nearly 8.5% at $12.60, up 99 cents.
Any Chinese deal to acquire Fiat Chrysler would likely be predicated on a global growth plan, including access to the company’s established network of dealerships.
The Jeep brand, in particular, is popular in China and highly lucrative because of its popular sport-utility vehicles and crossovers. The Ram brand’s pickup trucks and vans are also popular.
“The Chinese make a lot of sense” as a prospective buyer, said Kristin Dziczek, director of labor, industry and economics at Center for Automotive Research. “Chinese automakers have made no secret that they’ve got their mark set on the U.S.”
Still, the political implications of such a deal could prove thorny.
A deal would almost certainly raise political hackles in the U.S. over the possibility that a company rescued by taxpayers could yield to Chinese ownership.
The U.S. government bailed out Chrysler in late 2008 and 2009, funding the company’s bankruptcy and helping to negotiate Italian automaker Fiat’s deal to gain control of the brand. Several years later, Fiat gained full ownership of Chrysler.