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    Marchionne Wants to Simplify Fiat/Chrysler Merger
    Marchionne Wants to Simplify Fiat/Chrysler Merger

    Sergio Marchionne named the merger of Fiat S.p.A with Chrysler Group, targeted to finish by 2014, to be the main goal for both companies. Even though the merger plan isn't finished yet, Chief Executive of both automakers is already trying to ease the process.

    Speaking on the conference call about Fiat's Q3 results, CEO announced that they plan to convert savings and preference shares into ordinary shares in the near future. Marchionne said that the conversion would simplify the capital structure and remove the potential technical barriers to a full merger. Massimo Vecchio, a Mediobanca analyst, said that the share conversion plan, which is scheduled to be submitted for approval to a shareholder meeting in April 2012, is aimed at reduction of total number of issued shares and elimination of high dividends for the holders of preference and savings shares. According to The Wall Street Journal, at the moment Fiat is offering 0.85 of an ordinary share for each preferred share and 0.875 for each savings share.

    Struggling to end Fiat's European losses, Marchionne wants to turn Fiat and Shrysler into a single, global auto maker, and thus to reduce costs and achieve the target of $142 billion in combined revenue by 2014. Chief executive also pointed out that prior to the merger, Fiat must reach an agreement with the UAW on what to do with the 41.5% Chrysler stake that the union's VEBA Trust owns, and get in place the necessary financing.

    Fiat and Chrysler Continue Integration
    Fiat and Chrysler Continue Integration

    Yesterday, CEO of both Chrysler Group LLC and Fiat SpA Sergio Marchionne told the reporters that the two companies will move towards a single management structure. In the interview, which Marchionne gave after a speech at the Swiss-American Chamber of Commerce, CEO reported that the unified structure is most likely to be announced on July 26, along with Fiat's quarterly report.

    The change is of a little surprise given that Marchionne plans to merge the companies, which is supposed to reduce costs and help achieve the target of $140 billion in combined revenue by 2014. Having big plans for Chrysler, the Italian auto manufacturer wants to become the major shareholder. Initially, when Fiat agreed to help Chrysler emerge from the financial crisis, the company was granted 20% stake in Chrysler LLC by the Obama administration. By June 2011, Fiat raised its stake to 46%, and by the end of the year, the company aims to hold 57% of the third-biggest automaker in the USA, leaving the UAW with 41.5%.

    So far, there is no official timeframe for the merger, however, Marchionne mentioned that it is unlikely to happen this year.

    FIAT Returns to United States with Tiny 500
    FIAT Returns to United States with Tiny 500

    After a 27-year absence, Fiat returns to the US market with the sub-compact Fiat 500. Starting February 2011, Fiat minicars will arrive in about 130 U.S. Chrysler Group dealerships.

    The Fiat 500 is going to become a breath of fresh air in the U.S. subcompact car market. Indeed, a cute and stylish vehicle with the base model starting at $15,500 will probably take many likes off the Mini Cooper, Toyota Yaris and Hyundai Accent.

    To start, the Fiat 500 family will include three models; all will be sharing the same drivetrain, a 1.4L four rated at 101hp, coupled to either a five-speed manual (the “Pop” and “Sport” editions) or an all-new six-speed automatic (the “Lounge” model). When it comes to mileage, expect 30mpg/38mpg city and highway with the manual, and 27/34 mpg, respectively, with automatic equipped cars.

    North American 500s will be built at a Chrysler plant in Mexico, while engines will be assembled in Detroit. The Mexican plant is set up to produce 130,000 cars annually, and that capacity number also includes Central and South America, where Fiat has been a mainstay.

    Later this year, Fiat will extend the 500 lineup with a Cabrio convertible, as well as an electric model to be sold exclusively in the United States. In 2012, the company will add a turbocharged Abarth version of the 500 and potentially a micro-van based on the same platform.