Fiat wants to raise its stake in Chrysler to 58.5 percent by the end of this year

Article by Christian A., on September 21, 2011

After achieving a preset performance target, Fiat S.p.A. anticipates an increase of its share in Chrysler Group to 58.5 percent by the end of 2011. Currently, the company owns 53.5 percent of Chrysler Group. The final test would be to develop a vehicle based on Fiat that can achieve 40 miles per U.S. gallon, equivalent to 5.88 liters per 100 kilometers or 48 miles per UK gallon.

The group, which restated its critical mass target of about 6 million units by 2014, confirmed its 2011 group guidance which includes liquidity of about 18 billion euros and revenues of more than 58 billion euros.

Fiat's and Chrysler's CEO, Sergio Marchionne, said on Monday that the group had sufficient liquidity to help it endure the financial crisis.

Fiat has been hit by concerns that a worldwide economic slowdown would hurt its revenues. Marchionne, who has been credited with the turnaround of Fiat in recent years, wants to lift up the Italian automaker to be a global player through a revamped Chrysler. The group aims to attain about 100 billion euros or $144.2 billion in combined revenues by 2014.

He took management of a bankrupt Chrysler under a 2009 bailout agreement and has built up Fiat's share in the U.S. automaker more quickly and cheaply than expected.

However, Fiat still has to decide what to do with the rest of Chrysler, a 41.5 percent share owned by VEBA, the union trust fund of the United Auto Workers. The Italian automaker already has an option to purchase 40 percent of that share, beginning in June next year.

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