Fiat CEO Doesn't Want to Run Chrysler
Fiat’s CEO, Sergio Marchionne, said on Thursday that he does not have any interest in running Chrysler, the beleaguered American automaker it will become a partner with in the coming months.
“I have absolutely no intention of running Chrysler,” Marchionne said. “But as we work our way through, the implementation of the letter of intent, you will see…that we have taken some precautions to make sure that we are not ignored.”
In the proposed partnership, Fiat would obtain a 35 percent stake in Chrysler in exchange for small car expertise and access to foreign market dealership networks. Chrysler is currently 80.1 percent owned by private equity firm Cerberus Capital Management. Daimler, which owned all of Chrysler previous to Cerberus’ ownership, owns the rest of the automaker.
Marchionne was upbeat about the capabilities of the two companies to work together and achieve profitability. “We need to provide the framework for this to be able to generate cash and ultimately to return to a healthy level at the operating level,” he told analysts on a conference call regarding Fiat’s sales. “If the right level of concessions can be made, we can find a way to make this work.”
The partnership is contingent on Chrysler receiving $3 billion in loans from the U.S. government, in addition to the $4 billion it has already received. Fiat’s CEO said he will not accompany Chrysler’s executives when they submit their restructuring plan to Congress, on February 17th. “I don’t know how effective I would be,” he said.