19 February 2014

The New FCA (Fiat Chrysler Automobiles)

Hopefully this union isn't going to go downhill

Years ago Daimler Benz bought Chrysler and it was a failure. Italian FIAT has now bought US Chrysler and the merged company will be FCA, based in the Netherlands. It will however be considered a UK company for tax purposes. Confused? Sounds like an arrangement devised by accountants. So is everyone happy?

Italy: I visit focus2move, an Italian automotive website and the author of an article there felt FIAT was quitting Italy. You can read it here. I must say that FIAT will still make cars in Italy, but in terms of ownership and taxes paid, it could be seen as quitting.

USA: I guess it has to be said Chrysler is no longer a US company, although the US HQ will remain in Auburn Hills, Michigan. Many US citizens feel it's another bit of US industry gone to foreign ownership.

Too much may be resting on the Serbian built 500L.  

Good outcome: This would mean savings between FIAT and Chrysler sharing much of the car making costs. All existing factories will gain increased work as sales increase and profits generate news and improved vehicles.

Bad outcome: That FIAT continues to lose money in Europe, draining much needed capital away from R & D. This would stall any benefits of the union.

The new Jeep Cherokee. A strong brand within FCA

My take: The FCA is now the 7th largest car maker in the world. It can be a success but is by no means a sure bet. The FIAT range of cars is badly in need of new, exciting cars. It has to sort out the problem of its underutilised factories in Italy. Chrysler's product quality needs to be better and that seems to be happening already. Then in the longer term, pushing the company into the many world markets that they are poorly represented. There is plenty of work to be done.

2014 Dodge Durango. It needs to get out and see more of the world

2 comments:

  1. The key is Alfa-Romeo. FIAT have criminally wasted one of the greatest brands in automotive history. Alfa should be on a par with BMW instead of scratching round in the weeds.

    You can see that TATA have great plans for Jaguar to be the brand that everyone turns to when they want a sporty family car with some beauty and brand history behind it that isn't German. Alfa could fill the same niche, and be a big money-spinner for the group. FIAT's bosses have talked a big game for Alfa but haven't delivered so far. If they don't get it right, it will be curtains for FIAT in Europe. Chrysler will be sold off, and Alfa will be swallowed by VW or maybe Ford if they want to rebuild their premium options in Europe after the Jaguar disaster.

    Chris G

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  2. Alfa will take a lot of work, but it has to be done. VW wanted to buy the marque not long ago but FIAT said no.

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