Auburn Hills, Michigan – Fiat SpA, Chrysler LLC and Cerberus Capital Management have announced they will establish a gobal strategic alliance. The alliance is to be a key element of Chrysler’s viability plan.
The plan would provide Chrysler with access to competitive, fuel-efficient vehicle platforms, powertrains and components, to be produced at Chrysler manufacturing sites. Fiat would also provide distribution capabilities in key growth markets, as well as substantial cost savings opportunities.
In addition, Fiat would provide management service supporting Chrysler’s submission of a viability plan to the U.S. Treasury, as required. The alliance would also allow Fiat Group and Chrysler to take advantage of each other’s distribution networks, and to optimize their respective manufacturing footprint and global supplier base.
The proposed alliance would be consistent with the terms and conditions of the U.S. Treasury financing to Chrysler, and per that agreement, each constitutent will be asked to contribute to Chrysler’s restructuring effort, including lenders, employees, the UAW, dealers, suppliers, and Chrysler Financial.
Fiat would receive an initial 35 per cent equity interest in Chrysler. The alliance does not contemplate the Italian automaker making a cash investment in Chrysler, or commit to funding Chrysler in the future.