by Jeff Gilbert
WWJ AutoBeat Reporter
Interview: Jeff Gilbert talks about Fiat and Chrysler with IHS Automotive Analyst Mike Robinet
Fiat could take a fifty one per cent ownership in Chrysler by the end of this year.
“I think it is possible, I don’t know whether it is likely, but it is possible that we go over the 50 percent if Chrysler decides to go to the market in 2011,” Fiat and Chrysler CEO Sergio Marchionne told reporters in Milan. “There will be an advantage if that happens.”
Fiat took a controlling 20-percent share in Chrysler in 2009 in exchange for small-car and clean-engine technology, as well as management know-how. It expects to meet three milestones, each yielding another 5-percent share, to raise its total share to 35 percent this year.
In order to raise its share to 51 percent, Fiat would have to repay Chrysler loans from the U.S. government.
“This is a very important moment for Fiat, because it represents at the same time a point of arrival and a point of departure,” said Marchionne. “Faced with the great transformations in place in the market, we could no longer continue to hold together sectors that had no economic or industrial characteristic in common.”
Marchionne speaking at the Milan Stock Exchange, as Fiat Monday split its industrial vehicle business from its automaking unit.
Marchionne’s next corporate milestone will be to quote Chrysler on the U.S. stock exchange, a move expected later this year. Analysts expect the companies to eventually merge, although Marchionne repeated Monday he has no immediate plans to do so.
“A legal merger is not going to change our life,” Marchionne said.
Analysts feel that, so far, Chrysler and Fiat have been a good fit.
“There’s no doubt that the commitment from the Fiat leadership to Chrysler is certainly much more apparent than the Daimler commitment was to Chrysler,” said analyst Mike Robinet of IHS Automotive.
Robinet telling WWJ AutoBeat Reporter Jeff Gilbert that, while Fiat has helped Chrysler add new products to its lineup quickly, the addition of Chrysler has also been a help to the Fiat side of the business.
“It added scale and volume to their enterprise, so they were’nt really just focused on the European market and the South American market where they were strong.”
The Associated Press contributed to this report and provided the photo from the Milan Stock Exchange.