Fiat S.p.A. has decided to convert Chrysler dealers in Europe to Lancia. One of those affected by this decision is Paolo Mazzali, who owns a car dealership near Milan and whose company runs a total of three Chrysler dealerships.
For about a decade now, he has been promoting the "American lifestyle" that consumers will get to embrace when they buy Chrysler cars and minivans. However, all that is about to change.
Last Tuesday, Sergio Marchionne, the CEO of Fiat and Chrysler, ended sales of Chrysler in continental Europe after 40 years. Marchionne believes that by combining Chrysler and Lancia, losses will end in Europe and costs will be reduced by 1.5 billion euros ($2.2 billion) by 2014. Chrysler’s sales under Fiat plunged to about a quarter of its total figure with Daimler AG.
Olivier Francois, the Fiat executive who heads the Lancia and Chrysler brands, explained that a decision had to be made since the two brands can’t be maintained everywhere.
He said that in Europe, Lancia has a “higher awareness” while Chrysler is a “more global brand” for the U.S. and the other parts of the globe.
Fiat will consolidate Chrysler Group's results beginning this month, a sign of the quick integration of the two companies since Chrysler emerged from bankruptcy in June 2009. Fiat, which had previously been granted a 20% stake by the U.S. government, seeks to acquire 57% of Chrysler by the end of this year.