FIAT SpA Wins EU Approval For 20% Chrysler Stake

Turin, Italy

FIAT SpA won EU regulatory approval Friday to take a 20-percent stake in the U.S. troubled automaker Chrysler, according to Associated Press.

The European Commission said it did not see competition concerns with the deal which it said would give Italy's Fiat the ability "to exercise sole control" at Chrysler.

FIAT took the stake in return for engine and small car technology that Chrysler lacked. It can increase its holding at a later date. The U.S.government favors the deal and made new loans to Chrysler contingent on the FIAT tie-up.

EU antitrust regulators said the deal would not alter the markets for making and selling cars because the two companies have only limited rivalry. Chrysler does not make any cars in Europe, FIAT's main base, and sells few cars there.

They also saw no problems with FIAT acting as a supplier to car makers for lighting and transmissions systems because the deal would not allow the company restrict rivals' access to products that they need.

FIAT 500C Convertible to Take America by Storm!

This car is surely an out-of-the-park home run for FIAT/Chrysler in about 18 mos time from now. Rumored to be slated for assembly at Chrysler's Belvedere, Illinois assembly plant, beating the Mini's price by thousands by assembling in The States looks to be a master-stroke that the imported Mini will have difficulty competing with (and FWIW, to my eyes, the 500 is a far better-looking car... superior in equipment for the money, too).

Having made its international public debut at the 2009 Geneva Motor Show in March, the new FIAT 500 C is a convertible version of the iconic FIAT 500. The car pays homage to the original 1957 fabric roof version, but today's thoroughly modern interpretation offers customers innovative solutions in terms of mechanical design, engines and comfort.

It's hard to imagine this thing missing in the US... real nice product here,

and small cars are suddenly in-fashion, too.

Check it out, America- coming your way for 2011...

FIAT 500 Abarth Esse Esse

FIAT has been considering the sale of an Abarth-tuned FIAT 500 in the US. This rumor has now been confirmed in statements made by FIAT CEO Sergio Marchionne last week regarding four different 500 models coming to the US under the FIAT marque. Abarth is an in-house tuner along the lines of BMW's M or Mercedes' AMG... and has a fifty-year history modifying FIAT cars for racing and street performance.

Marchionne says he'll sell an Abarth 500 in the US in head-to-head competition with BMW's Mini Cooper and Volvo's C30. With the 500 representing the FIAT brand's return to the US, the 160 hp Abarth FIAT 500 Esse Esse (SS in Italian- for Super Sport) version shall be the marque's top-of-the-line performance offering in the United States- and what an impressively effective device it is...

Chrysler to Bring Four(!) FIAT 500 Models Stateside

Bloomberg reports that Chrysler Group LLC, the U.S. automaker run by FIAT SpA, will sell four models of the Italian carmaker’s 500 subcompact in the U.S.- this according to FIAT CEO Sergio Marchionne.

Chrysler, which emerged from bankruptcy on June 10, will eventually sell a convertible, wagon and sporty version called the “Abarth” in addition to the four-seat subcompact in the U.S., Marchionne said in an interview on June 30. While the base 500 will go on sale next year, he didn’t say when the other models will be available.

“All of those cars will be coming to the U.S.,” Marchionne said. “FIAT will be known in the U.S. purely in terms of its 500 car.”

FIAT, based in Turin, Italy, owns 20 percent of Chrysler Group, and is sharing vehicles and technology with the U.S. car company in exchange for ownership. FIAT said it sold 190,000 of the small cars, which are comparible to BMW AG's Mini.

In Europe, the FIAT 500 can be equipped with a 1.2- liter or 1.4-liter four-cylinder engine or a 1.3-liter turbo diesel. The 1.4-liter engine variant gets a combined, city- highway average of 36 miles per gallon under European regulatory standards.

“Its biggest impact will be to spark interest in bringing people back into the dealerships,” Aaron Bragman, a Troy, Michigan-based analyst with IHS Global Insight Inc., said in an interview. “Given the fact that it is an unusual car and quirky and cute, it is a good car for them.”

Chrysler’s most efficient model today is the Dodge Caliber, which gets 24 to 30 miles per gallon.

Chrysler, based in Auburn Hills, Michigan, filed for bankruptcy on April 30 because of plunging car sales.

Chrysler and Fiat Finalize Global Strategic Alliance

AUBURN HILLS, Mich., and TURIN, Italy, June 10 /Press Release -- Chrysler Group LLC and Fiat Group announced today that they have finalized their previously announced global strategic alliance, forming a "new" Chrysler that has the resources, technology and worldwide distribution network required to compete effectively on a global scale. The new Chrysler will begin operations immediately.

As part of the alliance, Fiat will contribute to Chrysler its world-class technology, platforms and powertrains for small- and medium-sized cars, allowing the company to offer an expanded product line including environmentally friendly vehicles increasingly in demand by consumers. Chrysler will also benefit from Fiat's management expertise in business turnaround and access to Fiat's international distribution network with particular focus on Latin America and Russia.

"This is a very significant day, not only for Chrysler and its dedicated employees, who have persevered through a great deal of uncertainty during the past year, but for the global automotive industry as a whole," said Sergio Marchionne, who today was named Chief Executive Officer of Chrysler Group LLC. "From the very beginning, we have been adamant that this alliance must be a constructive and important step towards solving the problems impacting our industry. We now look forward to establishing a new paradigm for how automotive companies can operate profitably going forward."

Mr. Marchionne continued: "We intend to build on Chrysler's culture of innovation and Fiat's complementary technology and expertise to expand Chrysler's product portfolio both in North America and overseas. Those Chrysler operations assumed by the new company that were idled during this process will soon be back up and running, and work is already underway on developing new environmentally friendly, fuel-efficient, high-quality vehicles that we intend to become Chrysler's hallmark going forward.

"The same attributes that first attracted us to this alliance -- a global automotive company with first-class technology, a devoted workforce, improved efficiency, a strong, global distribution network and an unyielding passion for building great cars that consumers want -- are even more true today. While it does not solve every issue faced by the automotive industry today, this alliance, established with the full support of President Obama's Administration, is a very significant step toward positioning Fiat and Chrysler to be leaders among the next breed of global automakers. This has, I know, been a difficult process for everyone involved, but we are ready to prove to the American consumer that Chrysler can once again be a strong, competitive company that produces a full portfolio of reliable vehicles that capture the imagination and inspire loyalty," Mr. Marchionne said.

Under the terms approved by the U.S. Bankruptcy Court in New York and various regulatory and antitrust regulators, the company formerly known as Chrysler LLC today formally sold substantially all of its assets, without certain debts and liabilities, to a new company that will operate as Chrysler Group LLC.

Chrysler Group in turn issued to a subsidiary of Fiat a 20 percent equity interest on a fully diluted basis in the new company. Fiat has also entered into a series of agreements necessary to transfer certain technology, platforms and powertrains to the new Chrysler. Fiat's equity interest will increase in increments by up to a total of 35 percent in the event that certain milestones mandated by the agreement are achieved, but Fiat cannot obtain a majority stake in Chrysler until all taxpayer funds are repaid.

Similarly, the United Auto Workers' Retiree Medical Benefits Trust, a voluntary employees' beneficiary association trust (VEBA) has been issued an equity interest in Chrysler Group equal to 55 percent on a fully diluted basis. The U.S. Treasury and the Canadian Government have been issued an equity interest equal to 8 percent and 2 percent on a fully diluted basis, respectively. These interests reflect the anticipated share dilution as a result of Fiat's incremental equity assumption once the milestones outlined in the strategic alliance agreement are achieved.

In addition to Mr. Marchionne, currently the Chief Executive Officer of Fiat S.p.A. serving as CEO, the new Chrysler will be managed by a nine-member Board of Directors, consisting of three directors to be appointed by Fiat, four directors to be appointed by the U.S. Government, one director to be appointed by the Canadian Government and one director to be appointed by the United Auto Workers' Retiree Medical Benefits Trust. The Board is expected to name C. Robert Kidder as Chairman. The process of determining additional board members is continuing and updates will be announced as appropriate.

As previously announced, Chrysler has entered into an agreement with GMAC Financial Services to provide automotive financing products and services to the Company's North American (NAFTA) dealers and customers. GMAC Financial Services will be the preferred lender in North America for Chrysler, Jeep® and Dodge dealer and consumer business, including wholesale of new and used vehicles as well as retail.

About Chrysler Group LLC

Chrysler Group LLC, formed in 2009 from a global strategic alliance with Fiat Group, produces Chrysler, Jeep®, Dodge and Mopar® brand vehicles and products. With the resources, technology and worldwide distribution network required to compete effectively on a global scale, the alliance builds on Chrysler's culture of innovation -- first established by Walter P. Chrysler in 1925 -- and Fiat's complementary technology.

Headquartered in Auburn Hills, Mich., Chrysler Group LLC's product lineup features some of the world's most recognizable vehicles, including the Chrysler Town & Country, Jeep Wrangler and Dodge Ram. Fiat will contribute world-class technology, platforms and powertrains for small- and medium-sized cars, allowing Chrysler Group LLC to offer an expanded product line including environmentally friendly vehicles.

Follow Chrysler news and video on:

Chrysler Connect blog: http://blog.chryslerllc.com

Twitter: http://www.twitter.com/chryslercom and www.twitter.com/chrysler

YouTube: http://www.youtube.com/pentastarvideo

Streetfire: http://members.streetfire.net/profile/ChryslerVideo.htm

About FIAT SpA:

Founded in 1899, FIAT is an automotive-focused industrial group, serving customers in more than 190 countries around the world. With some 185,000 employees, 114 R&D centers and 178 plants worldwide, the FIAT Group designs, manufactures and sells passenger cars (FIAT, Lancia, Alfa Romeo, Abarth, Maserati and Ferrari), agricultural and construction equipment (CNH Case New Holland), trucks and industrial vehicles (Iveco), and automotive components (FPT Powertrain Technologies, Magneti Marelli and Teksid). More information available at www.fiatgroup.com or www.fiatgroupautomobilespress.com.

Fiat CEO in Berlin to secure Opel takeover

Fiat CEO Sergio Marchionne has held talks with German Chancellor Angela Merkel and Economy Minister Karl-Theodor zu Guttenberg in an eleventh-hour attempt to win support for Fiat's bid to take over General Motors' Opel unit.

Mr Marchionne,  who is widely credited with FIAT Auto's dramatic comeback over the last five years, feels Fiat and Opel would be a well-fitted match and with signs that Berlin and General Motors (GM) are leaning towards a Russian-backed bid from Canada's Magna, the Italians wanted to put forward a strong case before the final decision is announced later this week. The Fiat CEO wants to combine GM's European and Latin American operations with Chrysler, in which it has secured a 20 percent stake, to create the world's second largest auto manufacturer. 

Meanwhile in Italy, FIAT labor unions are resistant to the takeover, fearing job losses. There is likewise unrest amongst Opel workers and German regional councils. Mr Marchionne has said there would be no plant closures were Fiat to be the successful bidder.

Impressive FIAT Bravo to Grace US Shores?

The compact, 5-door hatchback FIAT Bravo is comparable in size to the VW Golf, and has been on the European market for about 18 mos. now.  The car is very roomy inside, gets outstanding milage, and is a real Italian beauty- and an incredible amount of fun to drive.  And it seems an obvious choice for FIAT's new line-up in the US market.

Designed by the Fiat Style Centre, the model features tastefully uncluttered, smooth lines, which  reinvent the stylistic elements of the great Italian car-making tradition, without exaggeration or stylistic excesses.  The Bravo aims to make the difference in terms of quality, comfort, practicality and the versatility of the interior.  The refinement of the materials and the color combinations, the solidity, attention to detail and painstaking assembly, all represent a new standard for Fiat and a benchmark for the market.

The new Fiat Bravo features a new family of turbocharged T-JET petrol engines (120 and 150 bhp 1.4 Turbo), which combine fuel economy, low emissions and exceptional performance, and now join the popular range of Multijet common rail turbodiesels (1.9 litres delivering 120 and 150 bhp) and the 90 bhp 1.4 16v gasoline engine.  The fuel economy with these new engines is truly incredible, mid 30s on gasoline, and 40-50 mpg on diesel.

The Bravo was designed to score maximum points in passive and active safety tests, thanks to several airbags (as many as 7), three-point seat-belts with pre-tensioners and load limiters, and five head-restraints. Another aspect of safety regards the ‘Pedestrian impact’, which was taken into account during the design of the chassis, designed to maximise the absorption of this type of impact. The new model also features the most sophisticated electronic systems to monitor the vehicle’s dynamic behaviour, such as ABS complete with EBD, the sophisticated ESP system with a Hill Holder, and ASR anti-slip regulation.

The Bravo embodies new technologies, not only where engineering is concerned, but also in the use of electronics at the service of comfort and well-being on board. The best example of this is the new generation of the ‘Blue&Me’ system, known as ‘Blue&Me Nav’. This technology, which is a Fiat Group exclusive, developed with Microsoft, combines the functions of the first generation with a highly efficient pictogram navigation system, and access to a series of telematic services, that convey the true spirit of Fiat: simple, useful and at the right price.

Bravo was initially developed to be the new benchmark for what is the most important segment of the European market, which accounted for over 3,400,000 cars sold in 2006, or little more than one fifth of the total market.

In America, it is just the sort of premium compact the market largely lacks- and the type of product needed badly in the Chrysler dealer network.  It's style, feel, rock-solid quality, technology, safety, fuel economy, and refinement are indeed impressive... and it's unique Italian character will be a welcome reprieve from the monotonous same-ness of the Japanese products that dominate this segment.

I have had the pleasure of driving the 1.4L turbo (gas) version in Europe, and for such a small displacement, it's 120hp really gets moving with the standard 6-speed transmission... a lot of fun in a practical, attractive package.  There is also a 150hp version available... incredible for such an economical vehicle.