Chrysler and Fiat could become one company, says CEO Sergio Marchionne

Article by Christian A., on February 7, 2011

It’s possible that Chrysler Group and Fiat Auto will become one company that will have its base in the U.S., according to Chrysler and Fiat CEO Sergio Marchionne who spoke recently at the J.D. Power and Associates International Automotive Roundtable conference.

But before this can happen, Chrysler has to refinance the U.S. government loans that have prevented it from being profitable and it would also need to have its initial public stock offering.

Marchionne is hopeful that these things will be accomplished this year. Marchionne said that there could be “one entity” in the next two or three years.

He said that several alternatives are being considered by the company and that first, the company has to “integrate them operationally and then look at governance.” Chrysler has been working on revamping its product portfolio ever since 2009 when it emerged from bankruptcy.

In fact, Chrysler has16 new or revamped products that are set to arrive in the market in 2011. What’s next for the Chrysler-Fiat alliance is to share technology and platforms. Due in early 2012, the first product is a Dodge compact sedan based on Fiat architecture.

For 2010, Chrysler posted a modified operating gain of $763 million but a net loss of $652 million. Currently, Fiat holds 25% of Chrysler and by hitting several milestones, the stake can be increased up to 35%.

The first milestone that Chrysler achieved was in building the 1.4-liter four-cylinder FIRE engine at its Global Engine Alliance plant in Dundee, Mich. [via autonews - sub. required]

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