Giovedì, 18 Ottobre 2018

Fiat may turn to U.S. partner Chrysler for help


(ANSA) - Rome, July 13 - Italian automaker Fiat, which
three years ago rescued ailing Chrysler, is now looking to its
revived partner for an infusion of cash.
Fiat, Italy's largest private-sector employer, is
struggling financially and therefore turning to its American
partner Chrysler for help, says the Financial Times.
It's quite a reversal of fortune since 2009, when Fiat took
an initial 20 per cent stake in Chrysler, which was bleeding $1
billion US per month.
With Fiat's investments, plus government bailouts from both
the United States and Canada, Chrysler began to recover.
Now, it's time for payback to Fiat.
With an ownership stake of almost 62 per cent in Chrysler,
Fiat chief Sergio Marchionne may soon have access to the
American automaker's $10 billion US in gross cash - as well as
EBITDA (earnings before interest, taxes, depreciation, and
amortisation) reported as about $6 billion US, says the British
The newspaper report pushed Fiat shares 1.76% lower on
trading Friday morning on the Milan stock exchange.
Across Europe, but particularly in Italy, Fiat has been hit
hard by the sovereign debt and banking crisis, and the
subsequent recession.
The company's reliance on Italy as its base, both for
manufacturing autos but also as a sales market, is taking a
severe toll.
With the Italian economy in recession, new car sales for
all manufacturers plunged 24% per cent in Italy in June compared
with the previous year.
As a result, Fiat's Italian car plants are operating at
about 53 per cent capacity, the lowest among its European
operations, the Financial Times reports.
Annual sales in Italy for Fiat have fallen by almost half
compared with 2000, to about 550,000 units today from almost 1
In contrast, Chrysler is looking considerably stronger and
better able to assist its benefactor.
Chrysler, which has repaid its loans, sold 145,000 vehicles
in the U.S. last month - a 20% increase over the previous June
and the best sales results for the month since 2007, says the
Financial Times.

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