Bailout Watch 500: Chrysler to Fiat, Feds: It's All Yours!

by Robert Farago

Published: April 17th, 2009

bailout watch 500 chrysler to fiat feds it s all yours

CEO Bob Nardelli is punting. Boot ‘Em Bob has told the troops that Chrysler would cede control of its board and senior management to Fiat if the two automakers “merge.” “The U.S. government and Fiat would appoint a board of directors for Chrysler, with a majority of them independent directors who are not employees of either automaker,” Nardelli said in an internal memo intercepted by Reuters. “The board will have the responsibility to appoint a chairman. The board also will select a CEO with Fiat’s concurrence.” Seeing as Nardelli walked away from Home Depot with over $240 million in severance pay, one wonders how much it would cost management (that’s Uncle Sam now) to get rid of him this time ’round. Cerberus exits stage right. American Leyland enters stage left. Anyway, here’s the weird part: Reuters is a bit more specific about the government’s participation in this newly formed Chrysler Board than Automotive News, even though Reuters credits Automotive News for the info.

The two automakers are discussing a new seven-member board for Chrysler that would include representatives from Fiat and possibly President Barack Obama’s automotive task force overseeing the restructuring of the auto industry, Automotive News reported, citing sources close to the negotiations.

Also among the options under discussion is a direct role in Chrysler’s operations for Fiat CEO Sergio Marchionne, possibly even the chief executive’s job, according to the report.

Only Automotive News [sub] puts it slightly differently (at least in the latest version):

The U.S. government and Fiat would appoint a board of directors for Chrysler, with a majority of them independent directors who are not employees of either automaker, Nardelli said in an internal memo to workers obtained by Reuters.

Hmmmm.

Robert Farago

More by Robert Farago

Comments

Join the conversation

2 of 21 comments

FromBrazil on Apr 18, 2009

@Pch101 You're probably right, but this no money from them is probably the best stance to get as much TARP money as possible. Don't you think?

Like Reply
Pch101 on Apr 19, 2009
this no money from them is probably the best stance to get as much TARP money as possible. Sure. As I said earlier, I would do the same thing if I were in Fiat's position. It's a good negotiation tactic for them to use, and I'm not surprised to see them do it as this stage of the negotiation. It's up to the US government to play hardball here. My guess is that they'll play softball instead, and Fiat's required contribution will be lower than it probably should be, but something greater than zero.

Like Reply

Recent Comments

Rrp138519787 If Jeep wanted to re-introduce the Wagoneer name, they just should have named the Grand Cherokee L the Wagoneer instead, and done a little bit more styling differentiation. They could have done a super deluxe version as the Grand Wagoneer. But all Wagoneers would have been the three row version as the primary product differentiation. And would cause less confusion for consumers overall.
D The only people who have TDS, which I assume is Trump Derangement Syndrome, are the MAGOTS who have been brainwashed to love him. They Know Not What They Do.
The Oracle The updated Model Y beat this copy to market.
ToolGuy™ I respect what the seller is doing, but this vehicle is not for me. (Seller doesn't care, has two people lined up already.)
SCE to AUX How well does the rear camera work in the rain and snow?