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Is it looking to get taxpayer backed government funds to get into the US market?
I understand using each others distribution network worldwide, but other than that, it seems like another Diamler mess.
It would take at least two years or more to gain benefits of Fiats small car engineering.
Why wouldn't they just wait until Chrysler goes bankrupt then pick up the pieces it wants for a song.
I am wondering about that myself. I asked that question of a few people and the best someone could come up with was that Fiat would gain technology for making bigger vehicles.
They would get access to Canada & the US markets [[they are already in Mexico). They would also have access to Chrysler larger vehicles [[vans and larger cars) for the European market.
That's one of the keys, a distribution system. Setting up an entirely new dealer orgination would be a pain in the pocket book, and by alighning with Chrysler, that's what they'd get. In return, Chrysler would get an in place distribution stream overseas, and a presence in off shore markets, something they pretty much lost in the 1979 bailout when they were forced to sell [[the money losing) Simca/Roots operations in France and England. If Fiat waited for Chrysler to go under, it could get the manufacturing plants, but I'd be willing to bet that the dealer network would be a shambles by the time Fiat had cars to sell in the U.S.Also, unlike the Daimler deal, the two companies lines compliment each other. Fiat makes and sells small cars, Chrysler large ones, and trucks.There's one other thing to look at. Both companies are about the same size when it comes to volume, somewhere in the 1.1 to 1.5 million vheicles a year each. As the world automotive business concentrates more in the hands of larger volume producers, both companies were beginning to run the risk of being too small to survive on the world stage.
Why would Europeans want bigger cars?
Occasionally there is a demand for Minivan type vehicles.
Chrysler vans can be found all over England. Other than that, most of the continental market is open.
Chrysler's largest assets are the minivans and the Jeep brand. Jeep could see modest success in Europe, especially with the smaller models like the Wrangler and the Compass/Patriot.
People wonder why off shores invest here while Americans don't.
It's simple.
Look at central bank rates in consideration to trade.
Even though the fed has lowered the prime to near zero, what American corporations have access to that rate?
Very few if any that are in direct competition with off shore growth corporations.
Of course Fiat would like to use an American corporation as a beard, just like Mercedes did.
And when other nations use the debt our politicians have run up to fund their growth, it gets even worse.
And what does the public do in reaction?
They blame the victims.
Of course every politicians will give speeches about the evils of protectionism and trade wars. They just don't want you to know how badly they've been getting their ass handed to them in the trade wars they are losing right now.