1) where Fiat is getting the money to merge with Chrysler and get control of Opel, Saab, GM Europe and Latin America?
Just few months ago Fiat was in so big troubles that the Italian government had to create a new auto plan to stop plumbing profits. A new incentive plan was hastily devised just for FIAT after Marchionne made clear that the group was risking not surviving the year and threatened massive lay-offs. Few months after FIAT was supposedly still in trouble but was seeing some green shoots with the Chrysler joint-venture. Few weeks more and today FIAT wants to become the second largest auto corporation of the world.
Just few months ago Fiat was in so big troubles that the Italian government had to create a new auto plan to stop plumbing profits. A new incentive plan was hastily devised just for FIAT after Marchionne made clear that the group was risking not surviving the year and threatened massive lay-offs. Few months after FIAT was supposedly still in trouble but was seeing some green shoots with the Chrysler joint-venture. Few weeks more and today FIAT wants to become the second largest auto corporation of the world.
2) Is the Italian government involved?
Marchionne declared at the beginning of the year that he was seeing by 2010 only a handful of auto companies surviving and that FIAT needed to grow big fast to survive the collapse of the auto industry. Undoubtedly he is taking advantage of the situation created by the collapse of GM and Chrysler to scavenge companies for a bargain price.
Still is hard to believe that a company that was in dire finances just few months ago can pull out such a plan without any financial backing of a strong partner. Is the Italian government providing financial support with taxpayer money to the expansionist dreams of Marchionne? I think so!
Marchionne declared at the beginning of the year that he was seeing by 2010 only a handful of auto companies surviving and that FIAT needed to grow big fast to survive the collapse of the auto industry. Undoubtedly he is taking advantage of the situation created by the collapse of GM and Chrysler to scavenge companies for a bargain price.
Still is hard to believe that a company that was in dire finances just few months ago can pull out such a plan without any financial backing of a strong partner. Is the Italian government providing financial support with taxpayer money to the expansionist dreams of Marchionne? I think so!
3) Why Marchionne is so anxious to close the deal so fast? Is he aware of what is coming?
Marchionne is pushing for a deal in matter of days. For sure the fact that GM has a deadline till the 1st of June to return profitable or go bankrupt has something to do with his eagerness to grab as much as possible now at bargain price and easily rather than later when GM will be under bankruptcy protection and red tape and political litigation will make the task more burdensome. It is not clear yet if the bankruptcy protection for GM will be chapter 7 or 11 so either will be shut down completely or will be downsized, nationalized but still operating at minimum capacity. Still beside this the urgency of Marchionne and the rapidity of the events is something unprecedented and it smells horribly.
Marchionne is pushing for a deal in matter of days. For sure the fact that GM has a deadline till the 1st of June to return profitable or go bankrupt has something to do with his eagerness to grab as much as possible now at bargain price and easily rather than later when GM will be under bankruptcy protection and red tape and political litigation will make the task more burdensome. It is not clear yet if the bankruptcy protection for GM will be chapter 7 or 11 so either will be shut down completely or will be downsized, nationalized but still operating at minimum capacity. Still beside this the urgency of Marchionne and the rapidity of the events is something unprecedented and it smells horribly.
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