Fiat/Chrysler Chief Sergio Marchionne Gives up on Merger Attempts
12-06-15, 08:14 PM
#1
Lexus Fanatic
Thread Starter
Fiat/Chrysler Chief Sergio Marchionne Gives up on Merger Attempts
Fiat/Chrysler CEO Sergio Marchionne has been trying for some time now to link his already-large corporation with another one.....mainly GM or VW (although I'd bet he's glad he didn't link up with VW and inherit this diesel-emission mess). Looks like he's going back to the dugout, though, for at least a couple of years.
I LOL'ed at the part where he insinuated a possible hostile takeover to Marry Barra....like, yeah, she's just going to sit right back in her nice leather chair and let that happen.
http://www.thecarconnection.com/news...for-now-anyway
For months, Sergio Marchionne has spoken very publicly about wanting to merge Fiat Chrysler Automobiles with General Motors. Some have worried that FCA's CEO might resort to drastic measures to achieve his dream, but it appears he's finally given up -- at least for the next five years.
GM wasn't Marchionne's first pick, of course. In 2014, it appeared he'd set his sights on Volkswagen, but such a deal never materialized. (In retrospect, Marchionne dodged a bullet, didn't he?)
Then, early in 2015, Marchionne sent an email to GM's Mary Barra, whom he'd never met. He made his case for a merger, and Barra debated the proposal with others at GM, but ultimately, she declined his offer.
In June, Marchionne began discussing the matter in the media. He insisted that merging FCA and GM would benefit both companies, and he made it abundantly clear that he was exploring a range of options to make the marriage happen, including a hostile takeover.
Now, however, the CEO has changed his tune. Speaking to journalists yesterday, he said that he had no intention of pursuing the union -- at least not at the moment. Acknowledging GM's unwillingness to partner up, Marchionne said, "This is not an indiscriminate dating game. I'm not willing to go with anybody to get it done".
In contrast to the decidedly anxious, urgent tone he's stuck before, Marchionne appeared more confident this week. He said that FCA is in "relatively decent shape", and that it would invest the next five years and $52 billion in making Alfa Romeo, Jeep, and Maserati global brands. When the process is complete, FCA will reevaluate how -- and if -- it needs to merge with another automaker.
In the meantime, Marchionne suggested that FCA may align with less-likely companies to streamline production and boost revenue. He didn't name names, but PSA Peugeot Citroen is one possibility that's been floated before.
OUR TAKE
Marchionne isn't a grandstander. By all accounts, he's a fairly straight-shooter who's not afraid to assess matters honestly, even when the microphones are on.
So, unlike other CEOs and division heads, Marchionne probably didn't make this "Oh, we didn't want to merge with them anyway" statement to save face. More likely, he simply realized that it's not going to happen -- at least not without a lot of blood, sweat, and tears -- and he's going to focus instead on other things.
We agree that consolidation is an important trend -- one that we're seeing in many industries, not just the auto world. So we wouldn't be surprised if FCA wound up joining forces with some other company down the line, just as Chrysler once did with Daimler.
Will FCA's partner be GM? We can't say.
Perhaps a bigger question is whether Marchionne & Co. will be able to broaden the appeal of Alfa Romeo and Maserati from their current niche markets and make them larger, more globally respected brands. Jeep is essentially a no-brainer, but the other two? That's a subject for a different article -- though given FCA's debt of $8.5 billion, analysts aren't convinced. You can share your own thoughts in the comments below.
I LOL'ed at the part where he insinuated a possible hostile takeover to Marry Barra....like, yeah, she's just going to sit right back in her nice leather chair and let that happen.
http://www.thecarconnection.com/news...for-now-anyway
For months, Sergio Marchionne has spoken very publicly about wanting to merge Fiat Chrysler Automobiles with General Motors. Some have worried that FCA's CEO might resort to drastic measures to achieve his dream, but it appears he's finally given up -- at least for the next five years.
GM wasn't Marchionne's first pick, of course. In 2014, it appeared he'd set his sights on Volkswagen, but such a deal never materialized. (In retrospect, Marchionne dodged a bullet, didn't he?)
Then, early in 2015, Marchionne sent an email to GM's Mary Barra, whom he'd never met. He made his case for a merger, and Barra debated the proposal with others at GM, but ultimately, she declined his offer.
In June, Marchionne began discussing the matter in the media. He insisted that merging FCA and GM would benefit both companies, and he made it abundantly clear that he was exploring a range of options to make the marriage happen, including a hostile takeover.
Now, however, the CEO has changed his tune. Speaking to journalists yesterday, he said that he had no intention of pursuing the union -- at least not at the moment. Acknowledging GM's unwillingness to partner up, Marchionne said, "This is not an indiscriminate dating game. I'm not willing to go with anybody to get it done".
In contrast to the decidedly anxious, urgent tone he's stuck before, Marchionne appeared more confident this week. He said that FCA is in "relatively decent shape", and that it would invest the next five years and $52 billion in making Alfa Romeo, Jeep, and Maserati global brands. When the process is complete, FCA will reevaluate how -- and if -- it needs to merge with another automaker.
In the meantime, Marchionne suggested that FCA may align with less-likely companies to streamline production and boost revenue. He didn't name names, but PSA Peugeot Citroen is one possibility that's been floated before.
OUR TAKE
Marchionne isn't a grandstander. By all accounts, he's a fairly straight-shooter who's not afraid to assess matters honestly, even when the microphones are on.
So, unlike other CEOs and division heads, Marchionne probably didn't make this "Oh, we didn't want to merge with them anyway" statement to save face. More likely, he simply realized that it's not going to happen -- at least not without a lot of blood, sweat, and tears -- and he's going to focus instead on other things.
We agree that consolidation is an important trend -- one that we're seeing in many industries, not just the auto world. So we wouldn't be surprised if FCA wound up joining forces with some other company down the line, just as Chrysler once did with Daimler.
Will FCA's partner be GM? We can't say.
Perhaps a bigger question is whether Marchionne & Co. will be able to broaden the appeal of Alfa Romeo and Maserati from their current niche markets and make them larger, more globally respected brands. Jeep is essentially a no-brainer, but the other two? That's a subject for a different article -- though given FCA's debt of $8.5 billion, analysts aren't convinced. You can share your own thoughts in the comments below.
Last edited by mmarshall; 12-06-15 at 08:24 PM.
12-07-15, 08:48 PM
#2
Sad. Dodge is doing fairly well. They have more orders for Hellcats than they can fill. Unfortunately, Chrysler only has 2 sedans and a minivan. The 300, while still attractive, needs a complete overhaul. They badly need capital to expand the line. Not sure how Fiat is doing. Don't really keep up with them, although I imagine they are doing marginally better since they came to the US.
12-08-15, 05:44 PM
#3
^ The Hellcat is a niche model. Dodge currently can't give away the Dart, and they don't have a midsize offering at all.
And all I know is that a GM/Fiat Chrysler merger would've led to A TON of unemployment. I mean do you keep making Chevy trucks or Dodge trucks? What about all the engineers/designers and factories that make Rams? Durangos? Buick Enclaves?
And all I know is that a GM/Fiat Chrysler merger would've led to A TON of unemployment. I mean do you keep making Chevy trucks or Dodge trucks? What about all the engineers/designers and factories that make Rams? Durangos? Buick Enclaves?
12-08-15, 06:20 PM
#5
Lexus Fanatic
Thread Starter
The only reason Dodge markets it is so they can say they have something to go up against the Shelby Mustang and Camaro Z28. IMO, all three are niche-vehicles.
The Dart is actually a pretty nice small sedan, overall, that just got haphazard development of its drive-trains. That spoiled some of its appeal.
Oh, I agree the complexities involved would be enormous. And, when you say Chevy or Dodge Trucks, don't forget there's a another whole division of trucks in there, too....GMC.
It's obvious to most analysts what Marchionne really wanted......somebody else to help him pay his bills.
Dodge currently can't give away the Dart, and they don't have a midsize offering at all.
And all I know is that a GM/Fiat Chrysler merger would've led to A TON of unemployment. I mean do you keep making Chevy trucks or Dodge trucks? What about all the engineers/designers and factories that make Rams? Durangos? Buick Enclaves?
It's obvious to most analysts what Marchionne really wanted......somebody else to help him pay his bills.
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