Plans to shift Fiat HQ out of Italy may face obstacles

Article by Christian A., on January 29, 2014

Fiat chief executive Sergio Marchionne is about to disclose his next move to further improve business at the struggling carmaker – shifting the company’s headquarters out of Italy. Sources privy with Fiat told Reuters that Marchionne is likely to shift the headquarters to the United Kingdom, which is more tax-friendly than Europe.

Marchionne is also planning to have its primary share listing in New York. He is carefully considering his next moves, since the Italian government might interfere with his plans as any shift could bad news for the fragile Italian government that is struggling to protect jobs in its territory. "I've seen weirder things happen," Marchionne said at the Detroit Auto Show.

"So I sincerely hope they don't create obstacles." Fiat is now bound to take full ownership of Chrysler after inking an agreement to buy the remaining stake from a UAW retiree healthcare fund for $4.35 billion. The agreement opens the way for Marchionne to merge Fiat and Chrysler to form a global carmaker large enough to compete against other large carmakers.

It would have operations in 40 countries with brands including Alfa Romeo, Dodge, Ferrari, Jeep and Maserati. It is thought that a neutral country base could help secure the merger, learning from the lessons learned with the attempt by Daimler to run Chrysler from Germany. A neutral country like the UK would also give rise to tax-related incentives.

"Where the actual production of cars is not carried out in the UK, the reason for coming here would be largely a tax one," Chris Morgan, partner and head of tax policy at KPMG told Reuters. Experts remarked that registering the merge company in the Netherlands with a UK tax domicile could deprive the United States and Italy of tax revenue of some overseas earnings. The UK has been cutting its corporate tax rate to a proposed 20 percent in 2015 and trimmed the tax burden on profit from foreign units in low-tax jurisdictions.

Topics: fiat, headquarters

If you liked the article, share on:

Comments

Recommended

An RHD (right hand drive) BMW M4 DTM Champion Edition has been listed to be for sale by Romans International, UK’s leading supercar dealership. The first owner of this rare...
by - May 24, 2017
Audi will be offering something exciting for its United Kingdom market. The company announced that it will be adding new features as standard to the A4 range. It also confirmed...
by - May 24, 2017
You guys are probably aware of the collaboration between Mercedes-Benz and Renault-Nissan. Knowing this, you would expect that both companies will come up with something impressive. Sources say that the...
by - May 24, 2017
Amongst all sports cars on the planet, which one is the world’s best-selling model? Would you have guessed that it is the Ford Mustang? According to IHS Markit’s global automotive...
by - May 24, 2017
It’s not a bird. It’s not a plane. It’s Kris Singh’s blue carbon flying machine! Time stood still for a few minutes after the extremely rare Pagani Huayra BC Macchina...
by - May 24, 2017
Facebook

Youtube Channel

Tip Us
Do you have a tip for us?
Did you film an important event?
Contact us
Newsletter
Subscribe to our newsletter!
Subscribe
Galleries