Sunday, May 3, 2009

Fiat+Chrysler+GM=Fiat/Opel by end of May

From Financial Times: Fiat plans European car supergroup

Fiat is thinking big and moving fast. The tripartite deal by the end of May, and list shares of the new company by the end of the summer.

"Sergio Marchionne, Fiat chief executive, is on Monday due to outline plans to transform the global automotive landscape by spinning off Fiat’s core cars division, joining it with Chrysler and General Motors Europe, and creating a new publicly traded European car company.

"Mr Marchionne wants Italy’s largest industrial group to separate Fiat Auto from its other divisions, join them with Opel / Vauxhall, Saab, and GM’s other European operations, and Fiat’s stake in Chrysler to create a company with about €80bn ($106bn) of revenues and sales of 6m-7m vehicles a year – second to Toyota, more than Renault / Nissan or Ford Motor, or GM itself, and roughly as many as Volkswagen."

Fiat is taking full advantage of this worsening global resession and government intervention and subsidy that has grown with it. If he can pull it off, Mr. Marchionne's company will be a big force in three continents: Europe, North America, and Latin America.

It sure seems to me that the US government is selling Chrysler and GM short in the long run.


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