Chrysler Allies With Fiat

stephen987

Kenworth is a subsidiary of PACCAR, which also manufactures DAF and Peterbilt trucks. It is not part of Chrysler.

nippononly

The first is the legal angle--while European crash tests and emission tests are now pretty strict, they are not identical to those used in the US. The government could issue a statement that it will accept the results of those tests, and thus Fiat would not have to re-test the cars. But there is nothing that guarantees the government would be willing to do so, and lobbyists for the Big Two might argue against it.

You know who else would lobby against it? A very big and powerful lobby known as the "insurance companies" and the IIHS. This type of suspension of safety standards would throw everything they do into a tailspin. There is no way at all that this will happen. Fiat will just have to pay to bring their models to U.S. standards, something they already said they were doing with Alfas in order to reenter the U.S. market - something which has very noticeably NOT happened despite the company's constant assurances to the contrary for the last five years. What does this tell you about Fiat's financial position???

This whole thing sounds like fun, Fiats for sale again in North America, but it's a pipe dream.

stephen987

Fiat will just have to pay to bring their models to U.S. standards, something they already said they were doing with Alfas in order to reenter the U.S. market - something which has very noticeably NOT happened despite the company's constant assurances to the contrary for the last five years

Yes--but something has changed. Here's the math, as I see it:

Global economic crisis
+ Chrysler collapse (and the attendant job losses attached thereunto)
---------------------------------------------------------------------------
political will to do something drastic

There will be heavy lobbying of the legislative branch by the insurance industry--undoubtedly true. But the particulars of enforcing safety and emissions standards are left largely in the hands of the executive branch of government (DOT and EPA respectively).

Pres. Obama seems eager to be seen as an innovative leader, and an executive waiver or statement of equivalence (perhaps with a three-year sunset clause) would give him that image. He could also claim to be "standing up to special interests" in the name of "national economic interest." (Whether he would really be acting in the national interest, or merely substituting one set of special interests for another, is another matter, as one might say about pretty much any politician.)

One other wild card to toss into the mix: if Fiat gets Opel, it gets access to several platforms that were already (unlike some of Fiat's own) designed around global needs. Such platforms could probably be more easily adapted to the US market.

But is there time?

nvbanker

Fiat claims it can have cars in the US market in eighteen months.

That's fine, because in bankruptcy, it'll take at least that long to sell the existing inventory of Chrysler's!

joe0302

They will have to have one hell of a fire sale to get rid of their inventory.
I see alot of Dodge Goats and Jeeps rustng away on their lots.
I'd call China and say have we a deal for you. Philip Morris did and their stocks doing well.Ya, a chicken in every hooch and a Chrysler in the yard. :shades:

dtownfb

Chrysler's search for a mate spanned the globe

James B. Treece
Automotive News
May 6, 2009 - 12:05 pm ET

DETROIT -- For roughly two and a half years, Chrysler LLC co-President Tom LaSorda has been peddling his company. He met with other automakers in search of a partner or a buyer for Chrysler -- in whole or part.
Subscribe to Automotive News

Today, Chrysler wants a Bankruptcy Court judge's approval to turn the American automaker over to Italy's Fiat S.p.A. In evidence presented to the court, LaSorda and other senior Chrysler executives admit that other partners would have produced greater potential savings. But Fiat alone was willing to see talks with Chrysler through.

Here's the tale of Chrysler's road to Fiat, as laid out in court documents.

In the autumn of 2006, LaSorda and his bosses at what was then DaimlerChrysler agreed that he should start exploring possible partnerships. They turned first to Nissan-Renault. Talks began in the spring of 2007.

But after Cerberus Capital Management LP's purchase of Chrysler, those talks narrowed to a product-swapping pact: Nissan would provide a version of its Cube for Chrysler to sell in North America and Europe as the Hornet, and Chrysler would provide a version of its Dodge Ram pickup for Nissan to sell as the Titan in North and South America.

With Cerberus' blessing, talks broadened again.

In early 2008, LaSorda put Scott Garberding, then Chrysler's vice president of supplier quality, in charge of a new division called Global Alliance Operations. LaSorda told Garberding to find "suitable business partners, and quickly," LaSorda said in a court document.

Nissan: Project Go Global

In February 2008, Chrysler and Nissan assembled teams to explore possibilities of an alliance. The talks were dubbed Project Go Global.

Both sides formed 10 teams, most with seven to 16 high-level executives and operational-level staffers. They explored how a partnership would work in purchasing, product portfolios, powertrains, manufacturing footprints, advanced and green technologies, sales finance, sales and marketing, logistics, service and parts, and product-swapping deals. They also explored the prospect of Chrysler using Nissan's distribution network in South America.

In May 2008, the teams reported. A global alliance between Chrysler and Nissan-Renault would generate operational savings on a gross cash basis of more than $11.8 billion in cash flow for Chrysler alone and more than $18 billion for both sides over eight years, LaSorda said in a court document.

"I was very optimistic that a deal benefiting both companies could be reached," Garberding said in a written statement to the court.

Talks continued, nailing down details. In July, the companies exchanged lists of specific terms for the deal. But the talks broke down, LaSorda said, "due to the inability of Nissan's finance company to provide the needed support."

On Sept. 10, 2008, LaSorda, Garberding and other top executives from Chrysler and Cerberus met with Carlos Tavares, Nissan's executive vice president in charge of corporate and product planning, and other top Renault-Nissan executives in Paris for a full day of face-to-face talks, to no avail.

They tried a few more times, but in late October and November talks again broke down after Nissan, in light of collapsing credit markets, "could not commit to providing financial services support for new vehicles and dealer floor planning," LaSorda said.

GM: Project America

In June 2008, meanwhile, LaSorda had called General Motors' John Smith, senior vice-president of product planning and business development, and raised the prospect of a potential alliance. In early August, LaSorda and key lieutenants met with Fritz Henderson, then GM's president, and other GM executives to kick off talks. These talks were alternatively referred to as Project Denali or Project America.

Eventually, teams from the two companies reported that a tie-up could save $26.3 billion to $37.8 billion in gross cash flow over six years, with no one-time charges. But the two companies couldn't reach a deal. In November, amid worsening economic conditions, GM suspended talks with Chrysler.

In early January 2009, Chrysler CEO Bob Nardelli called GM CEO Rick Wagoner to suggest that they resume talks. Wagoner said GM wasn't interested.

Amid these talks with Nissan, GM and Fiat, Chrysler kept making overtures to other automakers.

In June 2008, Chrysler floated a proposal for ties with Toyota Motor Corp. Toyota said no in July.

Throughout the first quarter of 2008, Chrysler talked to Volkswagen AG. LaSorda met with Stefan Jacoby, CEO of Volkswagen Group of America, in January and with Volkswagen Chairman Martin Winterkorn during the Geneva auto show in March. But VW wasn't interested in anything beyond plans to have Chrysler build a minivan for VW.

Tata? Hyundai-Kia?

For three months, Chrysler discussed potential projects with Tata Motors, including the licensing of Jeep and other Chrysler vehicles to the Indian automaker. LaSorda traveled to Geneva between March and May 2008 to meet with Chairman Ratan Tata and then led a team to India to meet with the carmaker's CEO. But Tata was consumed with its purchase of Jaguar and Land Rover and its pending launch of the Tata Nano.

In the spring of 2008, Chrysler also talked with Hyundai-Kia Automotive Group. The immediate issue was an engine plant in Dundee, Mich., that builds an engine jointly developed by Hyundai, Chrysler and Mitsubishi Motors Corp. The plant was running below capacity because the joint-venture contract barred Chrysler from selling the engines to other automakers, LaSorda said.

Chrysler tried to end the joint venture, then offered to sell its interest in the venture to Hyundai. Hyundai rejected the offer in November 2008.

In July and August, Chrysler's Garberding traveled to Seoul to meet with Kim Seung-tack, Kia's global strategy group's senior vice president, about setting up a partnership involving compact and small cars. Chrysler wanted to have Kia build a version of the Kia Rio sedan and hatchback for sale under one of Chrysler's brands.

In talks from June until the end of September, Garberding got as far as pricing details for a Chrysler version of the Rio. Then Kia cut off the talks, citing problems with manufacturing compatibility.

From Russia, no love

In the first half of 2008, Chrysler also talked to Magna International Inc., Canada's largest supplier, and Russian automaker GAZ. The parties explored setting up a new car company in Russia. Chrysler hoped to license GAZ to make small cars and sell certain Chrysler vehicles through its Russian dealer network.

In August 2008, the two sides signed a memorandum of understanding, but the effort fizzled later in the year as the Russian economy followed other global economies downward.

Separately, in November 2008, Magna submitted a proposal to Chrysler. Ma

nippononly

the Fiat choice is not the best one, the first one, or even really an intentional choice? That bodes well. :sick:

nvbanker

Condemns both companies to death. Like mating two animals with Anthrax, and expecting a healthy offspring....

dtownfb

The Nissan deal was a lot closer than they let on. it also reveals that Daimler knew Chrysler was in trouble which explains the low price to unload it.

joe0302

Daimler(Mercedes) is having alot of quality control problems too. They realised to late that getting partnered up with Chrysler was a mistake.
I dunno,but Lexus must out sell Mercdes in the USA.

nvbanker

I dunno,but Lexus must out sell Mercdes in the USA.

I believe they do, and BMW as well.

dtownfb

This bankruptcy has been very revealing. Here's a link to an article discussing how bad off Chrysler is. It also explains why it is so important for Chrysler to emerge from bankruptcy so quickly. Not sure how any executives can allow their company to get so bad off.

http://money.cnn.com/2009/05/11/autos/chrysler_bankruptcy_filing.fortune/index.h- tm?cnn=yes

dtownfb

Article featuring 5 dealers who will be closed down by Chrysler.

http://money.cnn.com/galleries/2009/smallbusiness/0905/gallery.car_dealerships.s- mb/index.html

bpizzuti

There's a list out there....two of the dealers are in my general area. One's a mom and pop shop that's a dead duck: they don't sell anything else, don't have the room to, and likely won't be able to bring in another franchise unless Kia is interested (they don't have a store in my area).

The other one is actually a moderately big operation and did some really pioneering things that could have been beneficial to Chrysler. They'll live: they also sell Suzuki, which might hold them until they can get something else in.

Funny thing is, there's two other dealers that come to immediate mind in my area, one of them known for being pretty crooked. They get to stay open apparently. The other one is owned by the Healey Group, a seriously big-league operation which also sells GM (Chevy and Buick), Ford (and Lincoln/Mercury), Mitsubishi, and Hyundai, at about 8 or 9 dealerships, all within a 2 mile radius I think (the Chevy and Hyundai stores are right across the street from each other!) They wouldn't even NOTICE if they had to shut down their Chrysler operations.

So we have two owners, one of whom is losing their entire business, the other at least 75% of it. And the two owners staying open, one of them probably wouldn't have cared if they got shut down, and the other is run by a bunch of crooks. :shades:

Not much justice in the world, is there? Oh well, could do worse than keeping Healey I think. They are a good outfit.

gagrice

My guess is the list came from the White House for both GM and Chrysler stores to be closed. They are probably owners that did not support the Democratic Party in the last election. Just a guess. I read one story of a dealer that is doing good on that list. Wonder if he supported McCain.

stephen987

That's [non-permissible content removed].

gagrice

Just an Opinion. I don't see any advantage for Chrysler or GM to tell dealers they are losing their franchise. And there are dealerships that are not going broke on the lists. So maybe you have a good explanation for the list of dealers that were picked by the Obama team in control of both C & GM. You seem to have the inside track on this business.

bpizzuti

Well, I'd say the heads-up to the dealers would have been a good idea to let them know they need to find a replacement in their portfolio or make other arrangements. However, Chrysler didn't handle it that way, and the list got leaked to the public REAL quick (which you had to figure).

If they were only keeping Obama supporters open they would have closed all of NY north of White Plains, but they didn't. I do question the decision making...the Healey store would have been a better closing choice than the mom/pop operation, since Healey would have survived and maybe not even have noticed. Instead, they gave favorable treatment to the large auto conglomerate and shut down the small business. Which might have its own set of implications (While Healey is a good outfit, I tend to think small businesses are better for America than larger ones.)

I haven't found the GM list yet...I hope they close one of the two dealers that are within 1 mile from each other. One Chevy/Caddy that just theoretically changed "management," and one P/B/G that's been around a long time. Unfortunately, the well-run and much loved PBG dealer will be losing more of its product and might be the one that gets axed. The Chevy/Caddy dealer changes "management" (and names) every several years or so, but I bet they get to stick around just because they're already selling the brands that aren't getting axed.

stephen987

@bpizzuti: The two local dealers you describe sound very familiar. You wouldn't happen to be in central Georgia, would you?

I notice that the Chrysler list contains mostly low-volume rural dealerships, some of which are Dodge only, Jeep only, or Dodge/Jeep franchises. I guess they're moving toward full-line only, and the smaller dealerships are the losers here.

CNN was reporting yesterday that some of the dealers on the cut list sold less than 35 vehicles per year. I worked at a medium-sized dealership in a medium-sized market (Knoxville, TN) back in the 1990s, and we normally cleared at least 100 new Hondas a month--1200 a year. I can't imagine a dealership could stay in business selling less than 3% of that figure.

OTOH, GM has said it will axe mostly urban and suburban dealers, in areas where there is too much coverage. That makes sense--they are killing off several brands, and they too may well end up with consolidated full-line GM stores rather than separate ones for Chevy, Buick, & Cadillac. Of course, that in turn will remove any remaining incentive to keep the GMC truck line.

People are doing a lot of handwringing over the idea that lost dealerships will mean lost market share. But it seems to me the market share has already been lost, and the franchise cuts are simply an acknowledgement that it isn't coming back.

There are some relatively strong dealerships on the cut list, it's true. But they will most likely pick up other lines to sell. Hyundai, Kia, and VW are all on a blitz to increase their own market share, and they all could use some strengthening of their dealer networks. Nissan, Mazda, and Subaru could conceivably pick up a few as well.

fintail

That's a hilarious conspiracy theory - and I love conspiracy theories. Thanks for the chuckle :P

Get over it, Geezer/Dingbat lost, fair and square.

I know one of the dealers in my area that is being cut has a horrible reputation for both sales and service. Maybe that had something to do with it...

bpizzuti

Nope, I'm in Southeastern NY...Dutchess County area. I can understand the full line bit maybe, but one dealership (Rallye) WAS in fact full-line. They also sold Suzuki, but I mentioned what other stuff Healey sells and they didn't get cut....the "crook" dealer also sells Mitsubishi and they didn't get cut either.

35 vehicles per year is pretty bad, but I doubt any of these guys were that low.

It'll be interesting to see what GM does...they've literally got TONS of dealers around here. There's two that I think of besides Healey just because they're also pretty much right across the street from each other. Technically, there's 3 within a 1 mile radius, but the Saturn dealer is dead meat, and everyone knows it.

hpmctorque

In my opinion the government ran rough shod over the secured bond holders and, arguably, enabled Chrysler and GM to act similarly with regards to the dealers with whom it terminated agreements.

I think it was a mistake for the government to make the so-called loans to Chrysler and GM, because it created a situation where it got in deeper and deeper. Now it's a quagmire. The debt was converted to equity, and the government stands a minimal chance of ever recovering the money it invested. That's just one of the negative outcomes of this situation. It also sets a bad precedent.

stever

"according to bankruptcy judge Arthur J. Gonzalez, who oversaw the Chrysler bankruptcy and held a three-day hearing on the sale in late May, the value of Chrysler's assets in liquidation would have only come to about $800 million, rather than the $2 billion in going-concern value that they're fetching in the sale. Accordingly, secured creditors, including the Indiana pension plans, are doing better in the sale than they could have done otherwise."

CNN

hpmctorque

What you say may well be true, Steve, but unless I'm missing something, it doesn't factor in the billions of dollars Chrysler received and will receive upon consummation of the Chrysler-Fiat deal. I think the whole truth will only be known in retrospect, but right now the government's heavy handed intervention doesn't smell good to me.

One of my main concerns is the precedent that's being set with the government's recent involvement in the auto industry, which began in the waning days of the Bush administration, and was greatly expanded during the current one. Much of what's being done is justified by saying that it's for the greater good. That could lead this country down a slippery slope in the future, because "for the greater good" has the potential of running rough shod over previous agreements and contracts, and laws. Another danger is that for the greater good can also be a masquerade for political expediency.

I draw a distinction between government intervention for the purpose of saving the financial system from a melt down, and intervention in the industrial sector. It would take too long to elaborate on this distinction, so I won't try to here.

I understand that some situations, such as the domestic auto industry, are very complex and multi-dimensional, and that there are no perfect solutions. No matter what's decided, it'll go against the interests of large constituencies, even when intentions are good and other large constituencies benefit.

My conclusion on being against our government's recent actions is complicated by the fact that, emotionally, I'd like to see Chrysler and GM survive and thrive. I'd also like to see new Fiats and Alfas on our highways again. My rational side, however, believes that conventional Chapter 11 bankruptcies for these firms, or Chapter 7, would have been much preferable overall.

stever

it doesn't factor in the billions of dollars Chrysler received

My feeling is that it's going to cost the Treasury billions whether Chrysler folds or not. I guess I'd rather see the first dump of tax money go to trying to save jobs instead of immediately getting dumped into the social network programs, food stamps, extended unemployment benefits, etc. Either way, my dollars are on the hook.

To paraphrase Neal Stephenson, there's an endless supply of money. Unfortunately most of it gets spent on prostitution, sugar water and bombs. :P

I don't think this Chapter 11 is conventional in the sense that most of them never get out of bankruptcy in the first place. I bet 90% of companies in Ch. 11 wind up liquidating (and that could still happen here in a year or three). And if this is a slippery slope, we've been on it at least since the loan guarantee to Chrysler back in '79.

Then there was that bailout of the East India Company by the Brits in 1773, that resulted in some tea dumping. :shades:

stephen987

I'm with you, Steve. If we're going to be supporting these folks for the next couple of years, we might as well keep them working.

tomcatt630

Chrysler LLC went to DC with hands out saying 'gimmie'. So they got.

But, when banks and Wall St got $$ and no oversight there was outrage. Now, there are conditions and it's 'meddling'. Cant please everyone.

And were the dealers thinking the "status quo" would stay? Big 3 have been wanting to cut dealers for years, but state laws, fueled by kickbacks and 'free cars' to lawmakers, gave dealers too much power. [Buy a :lemon: and try to get help, they laugh in your face.]

Did they think they could squeeze blood out of a dead carcass?

hpmctorque

Now here's an interesting development:

From today's new York Times...

Tata Nano at Fiat-Chrysler Showrooms?
By Nick Kurczewski

Rajanish Kakade/Associated Press

"Tata Motors says it hopes to sell the ultra-cheap Nano in the United States in two years. But how? It’s no secret Tata Motors, India’s largest domestic automaker, wants to introduce its low-buck Nano city car in the United States. After all, a small matter like a global recession suddenly makes marketing the car, billed as “the world’s cheapest,” about as easy as selling snow cones in the Sahara.

Speaking at a meeting for Sustainable Global Enterprise at Cornell University last week, Ratan Tata, chairman and chief executive of the Tata Group, said he hoped to see the Nano arrive in North America by 2011, according to Reuters. This is despite the need to engineer the Nano to meet United States safety and emissions requirements, not to mention the search to find a suitable location to sell the cars.

So how does a company hope to re-engineer a car within two years for a market where it has absolutely no sales presence?

Luckily for Tata, the answer to these problems could be solved with a call to Fiat-Chrysler. Despite continued legal battles over the deal, a healthy Fiat-Chrysler union could pave the way for the Nano’s coming to the United States.

Fiat and Tata already share many joint ventures. Tata sells Fiats in India and has access to the Italian company’s diesel engines. The two companies share a giant factory in India, and Tata has developed a pickup truck that Fiat will sell under its own name.

Fiat’s chief executive, Sergio Marchionne, has also routinely stated his desire to introduce a budget brand to fit below Fiat’s already economical range of vehicles. An American or European version of the Nano, minus Tata badges, and possibly wearing a dormant nameplate from Fiat’s past (Autobianchi, anyone?), could give the Fiat Group its cheap car brand and Tata an entry into markets in Europe and the United States.

Considering that the Tata Nano can exceed 50 miles a gallon, even a revised version (fitted with air bags and a larger 3-cylinder engine) could help Fiat-Chrysler meet tough new Environmental Protection Agency emissions standards that start taking effect in 2012. These new regulations will push car company fleet averages to more than 35 miles a gallon by 2016, up from the current level of about 25. A fuel sipper like the Nano could help."

bpizzuti

So wait, the whole idea was for Fiat to provide small cars for Chrysler....and now the combined entity is going to Tata for them??? Chrysler outsources to Fiat who outsources to Tata? Exactly how many useless middlemen do we need anyway? :shades:

gagrice

It is simple. Tata is probably one of the fastest growing automakers on the planet. With Chrysler Fiat alliance they have a well established dealer network. Tata builds the vehicles and slaps the Fiat or Chrysler logo on them and everyone is happy.

As envisioned by Chrysler, Fiat and the government, Wednesday’s sale will create a new carmaker freed from the old Chrysler’s crushing labor costs and debt levels. In Fiat, which will run the company, it will have gained a partner skilled in making and selling small, fuel-efficient cars around the world. (think Tata Motors)

“We intend to build on Chrysler’s culture of innovation and Fiat’s complementary technology and expertise to expand Chrysler’s product portfolio both in North America and overseas,” Sergio Marchionne, the chief executive of Fiat, said Wednesday.

“Although we have many challenges yet to overcome, there is no doubt in my mind that we will get the job done,” Mr. Marchionne said in comments to employees.

Under the plan, Chrysler would emerge from bankruptcy with a union retiree trust owning 55 percent, Fiat owning a 20 percent share that could eventually grow to 35 percent and the United States and Canadian governments holding minority stakes.

Do you think the UAW retirees will give a rat's behind about the workers that sold them out to keep their high paying jobs? I think the retirees will want the Fiat Chrysler alliance to make money and keep their health care benefits coming. Both GM and Chrysler have proven beyond any doubt they cannot make money building cars in the USA. So do what you have to do to compete. Don't be surprised if Tata does not own the whole bunch within a year.

stephen987

Tata and other carmakers in India are about where Japanese manufacturers were in the late '50s--just beginning to branch out from badge-engineered versions of outdated cars from other markets. Maruti builds superseded Suzukis, as Datsun/Nissan built superseded Austins, for example. They are also sitting on top of the fastest-growing market-based industrial economy in the world--again, as the Japanese were fifty years ago.

A Fiat-Tata agreement for access to the U.S. market would be a major coup for Tata. And in five years Tata might well own Fiat and Chrysler. Which would give Mahindra some competition--after all, they've been building Jeep clones since 1954.

kernick

If we're going to be supporting these folks for the next couple of years, we might as well keep them working.

Why do you think that is the only option open to Chrysler workers, dealers, and plants? There have been many other automakers who went out-of-business during the years.

The way you make it sound, former AMC or Plymouth workers who are without a job, are infinitely going to be supported by the government because they know nothing other then how to make a Plymouth or AMC. They could never start a business? They could never work for another auto company who bought their plant? Or they couldn't work in some other sort of manufacturing? Is that what you're trying to convey.?

And if people who bought Chryslers no longer can buy Chrysler-products, that means there is going to be an economic loss? I don't think so. If a person was going to buy a Chrysler and now can't, don't you think 99.9% of them will buy some other brand's vehicle? Won't the other brands GAIN business if one fails?

The net result of any brand failing is basically ZERO. The only people who see major change are those who are working or major investors in the companies. These are the people fighting tooth-and-nail to keep the status-quo, and pushing the FALSE theory of major economic impact.

What you are seeing is nothing more than government and the wealthy-politically connected class, feeding on more power and $, under the guise of doing good for society, protecting us from this fictional collapse. A bunch of Bulloney! Wakeup, you're being played for a sucker!

There is no need to give billions to Fiat and Chrysler, when Chrysler could have went away, the Chrysler workers could go on to other employment, or work for the new owners that would buy the pieces of Chrysler, and the other remaining brands could have become stronger.

tomcatt630

Plymouths were made on the same line as Dodges and Chryslers, and workers at those plants consider themselves Chrysler Corp workers.

Plymouth was just a brand name, not a whole car company. In fact it never was, as Dodge was once 'Dodge Brothers'

bpizzuti

And if people who bought Chryslers no longer can buy Chrysler-products, that means there is going to be an economic loss?

Actually, you know Lemko from some of the GM threads, right? He's threatening to do just that if Buick goes away, and never buy another new car again from anyone ever. This particular part might not be so far-fetched with regard to some brand loyalists.

stever

"Chrysler Group LLC is planning to build the Fiat 500 small car at a plant in Mexico, according to a report published Monday.

Chrysler operates an assembly plant in Toluca, Mexico, that builds the PT Cruiser sedan and Dodge Journey crossover and employs more than 2,100 workers organized under a Mexican union. The company also has a truck assembly plant in Saltillo, Mexico."

Chrysler to build Fiat 500 in Mexico (Yahoo)

gagrice

So much for the UAW getting to build any cars. I figured that was the only way Chrysler could survive. If GM does not head South they will be gone before the end of the year.

kernick

I can't wait to see how some of the pro-bailout posters in these forums are going to try and spin this, into some "this is great for the U.S. economy" scenario, "and the best use of billions of U.S. tax $'s!". :sick:

stever

try and spin this

Better jobs in Mexico means less illegal immigration here with less strain on the social service network. Taxpayers will save a bundle. :shades:

fezo

They are just following the old pattern I watched 50 years ago and have seen repeated again and again. Company closes a plant in the Northeast to move south where the cheap labor is. After a bit they close up down south and move to Asia where the cheap labor is. In a couple of cases I've seen the whole corporation end up moving to Asia after a bit.

stever

Yeah, we only have to worry when they start making Levis in the US again. Then we'll know we're sunk.

kernick

Yes that's what I thought too - it's being driven by humanitarianism. Another 30M-50M good jobs to Mexico, and we'll have their illegal emigration issue fixed!

fezo

Yep. And we'll be sneaking over the border south...

stephen987

Yep. And we'll be sneaking over the border south...

US retirees are already doing so, in droves.

fezo

That they are!

I'm just trying to imagine the legendary reliability of Fiat mixed with quality Mexican construction..

stever

Stir in some high quality Pemex and a few dozen topos every day and you'll be set.

bpizzuti

I'm just trying to imagine the legendary reliability of Fiat mixed with quality Mexican construction..

Those would be the same Mexicans building the very popular and widely praised for quality Ford Fusion, right?

Oh, wait, they're also the same Mexicans that build several very electrically inept VWs...guess it's more about the car maker than the guys screwing it together.

Have to rely on the legendary reliability reputations of Fiat and Chrysler then. :lemon:

fezo

Yes indeed. I had a Mexican car - a 98 Chrysler Sebring. It was fine. Anything I didn't like about it was in design not build.

I think electrical ineptness is part of VW's DNA. It's what was all the trouble back on my 80 Rabbit and here 30 years later people still have issues with VW's electrical issues.

berri

Hey, they'll throw in some cheap [non-permissible content removed] Chinese parts and then extol the virtues of their new "world" vehicles.

stever

Parts is parts.

gogogodzilla

I've read that the GM, Ford, and Chrysler had signed, in the past, a contract with their unions guaranteeing the unions the right to organize any factory the companies open in the USA.

Which pretty much forces the companies to open plants *OUTSIDE* the US if they want to have a non-union plant.

On the other hand, imports have no such restriction, outside of local and state laws. Which would explain why all their plants are in 'right-to-work' states.