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Chrysler and Fiat have hopes for happy relationship
By Zheng Lifei (Agencies)
Updated: 2009-05-06 23:47 DETROIT — When Daimler-Benz merged with Chrysler in 1998, their leaders told the world to "expect the extraordinary" from the German-American auto giant.
The expectations for Chrysler's newly minted alliance with the Italian automaker Fiat are much less grandiose. And partly because of its more modest promises, the Fiat-Chrysler alliance may ultimately become the success that DaimlerChrysler never was.
Daimler acquired Chrysler to augment its own line of Mercedes-Benz luxury cars, not to integrate their operations and products. That merger ended badly in 2007, when the German parent could no longer tolerate the losses of its American division, and sold Chrysler off to the private equity firm Cerberus Capital Management. By contrast, Fiat and Chrysler both sell into the mass market, though with vehicles of starkly different sizes. They hope to build on their similarities, and save money in the process by sharing purchasing, engineering and distribution. "Our goal since we first entered discussions with Chrysler nearly a year ago is to leverage the strengths of both companies to yield the scale, efficiencies and cost savings necessary to create two stronger automakers," Sergio Marchionne, Fiat's chief executive, said last week. Mr. Marchionne is eager to add the European operations of General Motors to the mix as well. But first, he must avoid the same mistakes that derailed the DaimlerChrysler deal. |
