Fiat Takes 35 Percent Stake in Chrysler
Italian automaker Fiat will take an initial 35 percent stake in struggling Detroit automaker Chrysler, the companies announced today, suggesting the stake could expand.
Fiat will not give Chrysler cash, but it will give access to its small-car platforms and its more fuel-efficient technology. Chrysler will make Fiats here in the United States.
Chrysler needs help and fast in the passenger car category. Buyers are fleeing from Chrysler cars -- in November, sales of GM cars were down a staggering 59 percent compared with November 2007.
In December, sales of all Chrysler vehicles were down 53 percent compared with December 2007.
It seems Chrysler can't make a car Americans want to buy, so the automaker is turning to Italy for help. The UAW has endorsed the deal, which still has to be approved by federal regulators.
Fiat, which makes the Lancia and Alfa Romeo, has been trying to expand its footprint in the United States, after being little more than a hobbyist's and enthusiast's vehicle for decades.
This is not the first time a struggling U.S. automaker has looked overseas for help.
In the early 1980s, American Motors Corp. partnered with French automaker Renault to create a small four-door sedan called the Alliance. The car was universally panned by the auto press, which derisively termed it a "French Dart," referring to the clunky Dodge Dart.
The bad reviews, however, did not deter The Ticker from owning, as his first car, the follow-up to the Alliance, the hatchback Encore, which looked just like this.
That little beauty ran for 90,000 miles until it committed suicide by throwing a rod through its engine block.
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