Fiat’s ownership of Chrysler may have gifted the automaker with new technology, new products, and subsequently, new life – but Bob Nardelli, Chrysler’s ex-CEO during the days of Cerberus Capital ownership, tells The Detroit News Chrysler could have done just fine without the aid of the Italian auto giant.
Let’s reflect, for a moment. In 2007, Cerberus bought a controlling stake of Chrysler from Daimler AG in a $7.4-billion-dollar deal, which netted the investment firm nearly 80 percent of the automaker. Two years later, during Chrysler’s bankruptcy organization, Cerberus’ turnaround plan was rejected by the U.S. government, and the keys to the beleaguered automaker were essentially handed over to Fiat, which offered a means to revitalize the company. During the bankruptcy proceedings, government officials said that a fresh management team was essential, and a host of executives – including Nardelli himself – were swept from the company’s headquarters.
Now, Nardelli is saying the 20 percent stake in Chrysler Fiat was given was an unfair deal. Nardelli goes on to say that if Cerberus were extended a similar deal from the U.S. government, the company would have been able to resurrect Chrysler just as well as Fiat has.
“If the government gave us the deal they gave Fiat, we’d be doing just fine — really,”says Nardelli. “There was no reason for the government to give Chrysler away.”
Fiat has since spent about $2 billion in investments on Chrysler and raised its stake to a majority share of the company. Chrysler has also seen its sales and profit numbers boosted under Fiat’s control. Nardelli says that much of the groundwork for the recent new models and internal cost-cutting was all done by Cerberus while he was Chrysler CEO. However, late in 2009, Fiat and current Chrysler CEO Sergio Marchionne told the Wall Street Journal that “we were surprised by how little had been done in the past 24 months.”
Source: The Detroit News
