By on April 30, 2015

Apple Logo Circa 2005

FCA CEO Sergio Marchionne’s search for a consolidation partner may take him to Silicon Valley if the automakers won’t give him the time of day.

While making his pitch for consolidation during Wednesday’s Q1 2015 earnings call, Marchionne said dialogue about a possible partnership with Apple or Google if he couldn’t pair FCA off with another automaker should be encouraged, Bloomberg reports.

His reasoning?

I’ve always been intrigued by the notion of having technology disruptors show up in the marketplace and change the paradigm. If they show up and they are truly successful, with their cash piles and know-how, they could fundamentally hurt this industry.

At present, FCA already has an established relationship with Apple, with the tech giant’s Internet software and services boss Eddy Cue having a seat on Ferrari’s board, and CFO Luca Maestri having several years of experience in the automotive industry, including helming General Motors’ relationship with Fiat between 2000 and 2005.

On the other end, Apple is hard at work on an EV, with production set for 2020 unless the execs aren’t happy with progress. The company’s shareholders also would like Apple to pair-off with Tesla — the most recent urging occurring last month — though CEO Tim Cook only stated that the Californian automaker would use his company’s CarPlay connected-vehicle system.

As far as FCA and Apple heading down to the chapel is concerned, no one at the latter offered any comment to Marchionne’s proposal. With the company having just purchased Beats for $3 billion last year and divesting itself of in-house production of its physical offerings, a deal between it and any automaker, let alone FCA, isn’t likely at this time.

[Photo credit: Christopher Aloi/Flickr/CC BY-SA 2.0]

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75 Comments on “Marchionne May Marry FCA To Apple, Google If No Automaker Will...”


  • avatar

    No

    • 0 avatar
      JMII

      “Hell no” immediately came to mind.

      Also I’m not buying the Apple is making their own car or buying Telsa nonsense either. Apple has a good thing going right now, they aren’t doing anything to damage that.

      • 0 avatar
        Sigivald

        Yeah, I am not sanguine about “Apple is making a car!”, either.

        But I am even less so about the idea that they’d be remotely interested in acquiring FCA.

        Apple acquires companies that make something Apple wants to guarantee access to or incorporate; special glass or machining, or novel software.

        FCA? No chance.

        (And I don’t think Google will fall for it either.)

      • 0 avatar
        Lou_BC

        The Apple HellCat………. has a nice ring to it.

    • 0 avatar
      catachanninja

      Chrysler is once again so awesome that no one wants them

  • avatar
    CoreyDL

    “including helming General Motors’ relationship with Fiat between 2000 and 2005.”

    I don’t think this would require much more than an email address like [email protected]

  • avatar
    CoreyDL

    It seems to me like Marchionne is just throwing out nonsense ideas, hoping something sticks. Any smart company could see he’s very desperate, which means it should become a waiting game to drive down price until he’s -forced- to make a deal which is not on his terms.

    The best time to buy in is not when the gates to the manicured driveway are wide open, but when they’re half-closed and overgrown with a few weeds.

    • 0 avatar
      bball40dtw

      I think he has lost his mind and his vaporware plans are propped up by RAM and Jeep North American sales. It’s like a manufacturing ponzi scheme.

      • 0 avatar
        CoreyDL

        Don’t forget Alfa! They’ll be a very real contender with a complete line-up, very very soon.

        What was the sales goal in 2020?

        • 0 avatar
          bball40dtw

          400K by 2018. 400K! They need 150K annual sales in the US according to the plan. They are at 217 so far this year.

          • 0 avatar
            CoreyDL

            HAHAHAHAHAHA

            Well typically the 3rd quarter is good for car sales.

            I mean, they haven’t even sent 150,000 cars to the US in a single year, and I bet their lifetime historical sales total around that number.

          • 0 avatar
            bball40dtw

            Maybe he can buy Mitsubishi’s North American Operations and rebadge some of their crap. That worked so well the first time. Diamond Star Motors: FCA Edition.

          • 0 avatar
            CoreyDL

            Hey just because you had the only Sebring Coupe with any problems, don’t condemn all their stuff as complete crap!

          • 0 avatar
            bball40dtw

            I was never a Sebring owner, thank God.

            I do remember plenty of friends and fellow students having Eclipses and Talons in high school. All exploding money pits.

          • 0 avatar
            CoreyDL

            I rode recently in one of the Sebring Coupes (year or so ago, I think), actually one of the restyled ones with the 300M style front, that you rarely see (was an 04 or 05).

            I think the worst part was the fake luxury touches like terrible quality ruched leather, fake wood, and an entire dash full of switches from the Montero. And everything rattled. And the engine (v6) leaked oil and got terrible mpg.

            But boy was my friend proud of his “luxury coupe.”

            I’m like okay next time we’ll take my GS. I’ve had enough.

            Edit: Photo of interior. Except instead of that aluminum I think it had wood tone.

            http://files.conceptcarz.com/img/Chrysler/2004_chrysler_sebring_2dr_manu_02.jpg

          • 0 avatar
            bball40dtw

            Much ruching, so fancy.

          • 0 avatar
            CoreyDL

            It has a crapload of elegance for the BHPH customer.

          • 0 avatar
            MLS

            The faux wood trim was located on the console around the shift lever. There might have been a few bits on the doors, too. In the second generation Sebring coupe’s later years, the wood trim was deleted and the center stack covered in the then-trendy silver plastic pictured in your image. Here’s the original interior:

            http://media.ed.edmunds-media.com/chrysler/sebring/2001/oem/2001_chrysler_sebring_coupe_lxi_i_oem_1_500.jpg

            Honestly, I don’t think it was so bad for its time. Here’s the contemporary Solara interior for comparison:

            http://i584.photobucket.com/albums/ss281/GoldstarMarketing/01ToyotaSolaraInterior4.jpg

          • 0 avatar
            CoreyDL

            You’re probably right. I was so put off being in there that I quit looking around to notice details after a few minutes. Most times I spend almost the entire time in the car looking at details when I’m in someone else’s car.

          • 0 avatar
            Lorenzo

            Well, technically, both the Dart and new 200 are stretched, lengthened, modified versions of older FWD Alfa platforms. I anticipate people arguing differently, but neither Fiat nor the old Chrysler had put out a clean sheet design in years. The bottom line is they should have kept them as Alfas for the American market, and gradually refined the older Dodge/Chrysler cars.

          • 0 avatar
            CoreyDL

            The Solara has perforated leather and Lexus bits in it. I’m having that one on looks alone. Much less for materials.

          • 0 avatar
            MLS

            What Lexus bits? That interior looks straight outta Corolla, though I will admit that the perforated leather is preferable to the Sebring’s pleats.

          • 0 avatar
            CoreyDL

            Wood, some buttons, the stalks at the wheel.

          • 0 avatar
            28-Cars-Later

            Would be nice to find a clean Solara.

          • 0 avatar
            CoreyDL

            Not difficult!

            http://www.ebay.com/itm/Toyota-Camry-Solara-SE-/391129307682?forcerrptr=true&hash=item5b111f9a22&item=391129307682

            That one just needs new wheels, they’re ate up.

          • 0 avatar
            28-Cars-Later

            This is average condition at best, not clean. Battery corroding and will need replaced, the shock towers look factory which means the shocks prob need replaced. Exhaust looks welded and the undercarriage has heavy patina. This spent most of if not its whole life outside. Plus its the SE with 186K.

            Clean for this age is <100K and garage kept, plus 28CL wants a roof which the SE lacks.

            This is more my speed but the seller is on crack. The car also sounds like it might/should be R-title. Since the accident was in Wheeling WV and is now in TN I'm very suspicious as to what did/should have happened to the car/title. WV be trippin' yo.

            05/20/2010 WHEELING, WV
            State Agency FRONT IMPACT WITH ANOTHER VEHICLE
            MODERATE DAMAGE REPORTED

            Oh and then its TMU now? This is why I hate people and their BS. So now it should be R-title and is TMU and the c********* wants 11,9?

            68,727 02/21/2012
            68,764 03/22/2012
            69,000 04/04/2012 not included in rollback calculation
            68,777 04/18/2012

            http://www.ebay.com/itm/Toyota-Solara-2dr-Convertible-V6-Automatic-SLE-/321738562704?forcerrptr=true&hash=item4ae91cdc90&item=321738562704

            This one is much nicer but he wants alot and shows no motor or undercarriage pics.

            http://www.ebay.com/itm/Toyota-Solara-2Dr-Conv-V6-Auto-SE-Sport-/111658996933?forcerrptr=true&hash=item19ff6514c5&item=111658996933

          • 0 avatar
            CoreyDL

            Lol, I assumed you didn’t want the convertible, because gross. I was looking original body style and coupes only!

            Plus I don’t care much for the revised body style. Too odd.

          • 0 avatar
            28-Cars-Later

            Depends on what you like. Finding a gen 1 clean at this point is a tall order simply because of age. If one is gonna go back to MY00ish and look for unicorns one might as well go back a few more years, look for an SC300/430 and spend the coin. Chances of a Lex being babied are higher than what is effectively a Camry Coupe being babied and well preserved.

            This wouldn’t be a bad buy if it wasn’t R-title, MY08 bidding around 6:

            http://www.ebay.com/itm/Nissan-Altima-3-5-SE-/191567186904?forcerrptr=true&hash=item2c9a4b4bd8&item=191567186904

          • 0 avatar
            Scoutdude

            That blue one on Ebay looks pretty good for its age and being in NY.

            When struts are replaced the parts that are visible from inside the engine compartment are not normally replaced. So that tells you nothing.

            A battery case does not corrode, it is the terminals on the wires that corrode so that in no way condemns the battery, though I would replace it based on the brand which is known to fail w/o warning no matter what the age is.

            The biggest issue from a cost standpoint is that it needs 4 new tires. They are mismatched and 3 are of extremely low quality. The wheels could be saved with a little work though I suspect some used ones could be found for relatively cheap.

  • avatar
    CJinSD

    Desperation is a stinky perfume.

  • avatar
    th009

    Marchionne sounds increasingly desperate.

  • avatar
    Big Al From 'Murica

    Not sure the relentless focus on design and build quality at Apple lines up with FCA. Can’t see Google getting into this either. If either of them wanted to get into the car business it would be in the form of some sort of, forgive the term, game changing product. Apple Marketing is a juggernaut, but nobody is going to all of the sudden find the Dart desirable because someone slapped a piece of fruit on the grill. Both companies are smarter than this.

    • 0 avatar
      Luke42

      I don’t think the margins are high enough for Google. Ever wonder why Google lets everyone else make tons of money in the Play Store? It’s not because they couldn’t develop everything there themselves — it’s because they consider being in a low margin business like making photography apps to be an “opportunity cost” when they could be making more money elsewhere. The car business as we know it doesn’t fit in to this mold..

      As for Apple, as other have said, they’re more of a design company than a manufacturing company. If they come up with what they consider a “revolution” in automotive design, they’ll be looking for an automotive Foxconn. Maybe Nissan could be this, but they don’t necessarily have to own their contract manufacturers.

  • avatar
    LeMansteve

    “On the other end, Apple is hard at work on an EV, with production set for 2020”

    Don’t you mean Google?

  • avatar
    Big Al From 'Murica

    Too Soon for an FCA Deathwatch?

    • 0 avatar
      Pch101

      Yes, you’re early.

      • 0 avatar
        Lorenzo

        I’m not so sure.

        “Fiat Chrysler Earnings: Profits Are Too Thin For Comfort” – Motley Fool

        “Fiat Chrysler Shares Extend Losses After CEO’s Consolidation Call” – Reuters

        “Fiat Chrysler Headline Profits Look Good, But Bernstein Research Worries About Threat From Debt” – Wall Street Journal

        “Marchionne Talk of Industry Mergers Called Sign of ‘Panic’ ” – Bloomberg

        TTAC’s GM Deathwatch began long before it was obvious how much trouble GM was in. It’s not a death watch if you wait until it becomes obvious, and those headlines are coming close to making an FCA bankruptcy a reasonable possibility. GM was able to hide a lot of its problems, FCA is likely to be doing the same.

        • 0 avatar
          Pch101

          This is the same financial media that reports that Tesla is profitable when it isn’t and that didn’t have a clue that the financial crisis was coming.

          The financial media is good for reporting news events, such as a tanker sinking in the Gulf or the release of an earnings report. The analysis isn’t usually worth a damn.

          Q1 saw earnings and revenue growth in spite of a slight decline in deliveries globally. Latin America is a sore spot, but that is a regional cyclical problem faced by the industry.

          FCA faces some long term threats such as in Europe as I noted elsewhere, but the company is well managed. Don’t discount Marchionne — he has talent, and management is key. (If Rick Wagoner was in charge, then it would be a different matter.)

        • 0 avatar
          360joules

          I am not trying to be rude, I know you worked hard to put together a post with quotes and citations, but you lost anyone with 10 plus years in the market with a Motley Fool quote. WSJ & Bloomberg (used to be BusinessWeek) are mixed bags since ideological acquisitions, but Motley Fool is unadulterated stock porn. Read below for PCH101’s post.

  • avatar
    Pch101

    Prior to the Chrysler deal, Marchionne was saying the same things about industry consolidation — thinking out loud is a big part of his strategy.

    Just a couple of weeks ago, FCA had a $3 billion bond offering.

    It’s pretty clear that he’s trying to find more cash to do his next deal.

    • 0 avatar
      th009

      He might want to save a few pennies for product development. Fiat is still starving for competitive product.

      • 0 avatar
        Pch101

        He wants PSA. PSA is playing hard to get, but is receptive to being chased.

        • 0 avatar
          CoreyDL

          Oh Jeebus think of the reliability possibilities there.

          Not to mention all Chrysler/Ram vehicles are thoroughly undesirable outside North America. And PSA doesn’t know how to sell cars in the US, since they left in what – 1991?

          • 0 avatar
            bball40dtw

            Alfas with Citreon suspensions sold as Jeeps with Chrysler engines!

          • 0 avatar
            Pch101

            You need to put yourself in his shoes if you want to see what he is seeing.

            VAG controls one-quarter of the European market, including its largest market (Germany.)

            Fiat is not only smaller, but its largest markets are in the less prosperous south. These are serious disadvantages in light of the above.

            PSA isn’t a prize catch, but it would more than double FCAs market share in Europe, as well as provide it with more presence in some of northern Europe (if France can be considered Northern Europe.)

            Ultimately, this is about mounting a defense against VAG. PSA’s lack of presence in the US is actually an advantage for this kind of arrangement — no overlap.

          • 0 avatar
            CoreyDL

            The most recent Citroen I liked was the C6. It was such a stunning design.

            http://tdnu.ru/images/Citroen_C6_2.jpg

            Yaaaaas.

  • avatar
    LeMansteve

    I’d be interested in seeing a fresh take on the automobile as we know it today. Cars today are leagues better than they were 10, 20, 30 years ago but still they remain extremely complex, dirty and expensive pieces of equipment. Google has given us a preview of their answer to these issues but I want to see other companies give it a shot.

  • avatar
    APaGttH

    BWHAHAHAHAHAHAHAHAHA!!!

    Good luck with that.

  • avatar
    TW5

    FCA sells record numbers of Jeeps and Rams on the eve of CAFE 2025, yet the company has no hybrid technology portfolio or light-weighting strategies. They have diesel and 8-speed transmissions.

    The industry knows FCA is screwed. No one is going to merge with them. The auto industry will wait for fines to bleed FCA, and then competitors will buy their nameplates for a discount. GM will buy Jeep. Nissan will fight the Koreans and Chinese for RAM. Ferrari, Alfa, and Maserati are prepped for spin off. Chrysler and Dodge will go bye bye. Fiat will be bailed out by the Italian government.

  • avatar
    mfrank

    Oh the drama at Chrysler. I don’t understand why the government didn’t merge GM and Chrysler when they had a chance.

  • avatar
    Tstag

    It doesn’t make sense for Apple to tie up with FCA. FCA is a Goliath with plenty of problems. A better bet would be BMW, Mercedes or JLR. All of which are already doing well.

    FCA really aren’t doing very well. To put it in context they made 99 million dollars in Q1 despite the success if Jeep. The companies margin are far too low. Clare with JLR who make about 500,000 units per annum and generate nearer 2.5 billion Dollars a year in profit despite the huge investments they are making to grow the company.

    No wonder Marchionne is looking for friends

  • avatar
    carguy

    Think of the brand synergy! When I think of the Apple brand, I immediately associate it with a Hemi RAM truck, Hellcat or a rental grade Chrysler 200. Or what could be closer to Google’s brand values than a diesel Fiat Panda? This guy is a genius.

    • 0 avatar
      CoreyDL

      When I think of the Apple brand, I think of a Jetta with stickers on it including the Apple logo, a coexist sticker, and something about fair trade this or that commodity.

  • avatar
    sportyaccordy

    When I was in 6th grade, I transferred from a big public school to a private school. Every year they sent out a handbook with everyone’s phone numbers (and addresses?). So I did what any pubescent 12 year old would do, and proceeded to call every girl in the phone book and ask if they would be my girlfriend over the course of my first year.

    My success rate was about as high as Marchionne’s.

  • avatar
    Vulpine

    Hmmmm… A couple interesting points there, one of which goes far beyond any such definitive statements previously. I find it rather hard to believe Apple has actually committed to building a car when all information up to now is mere speculation based on reported hires which themselves may not be completely factual.

    Still, Apple has made it clear they at least want into the dashboards of cars and several different brands are already either making their cars iphone/iPod compatible or even using CarPlay, among which FCA counts itself.

    I’m sure Tesla doesn’t want to tie itself to an ICEV conglomerate since its own offerings are BEVs and to be sure, they dare not now when considering a very Tesla-friendly regulation in Maryland that emphasizes that any automaker can own its own dealerships IF all they sell are EVs AND they don’t have any existing franchised dealerships in the state. Tying themselves to Fiat would very probably invalidate themselves from that permit.

  • avatar
    James2

    Sergio needs to start a reality TV show like The Bachelor to find his savior.

    • 0 avatar
      CoreyDL

      The Real Fiat / Road RAM Challenge!

      It only lasted 2.7 episodes. It was shown on a PT schedule before it was Eclipsed by a Challenger. At first people thought there could be bon Amis made here. But being on at 308 AM created a bit too much Stealth for the program.

  • avatar
    redav

    And how would such a merger align with the presentation we saw the other day? Would a non-car company really reduce wasted costs & improve FCA’s numbers? I don’t seem to think so.

  • avatar
    Jack Denver

    I really doubt if Apple wants FCA, but what about some kind of deal where FCA turns over the whole user interface to Apple. Not just the radio, but Apple gets to rethink the whole driver interface the way they rethought the flip phone. Even going beyond just the entire dashboard – in this age of drive by wire, does the whole 100 year old pedal and steering wheel layout make sense? Do you command your computer with all 4 limbs?

    And in turn, they get %s of revenue on whatever apps or content you buy for your dash. And there would be apps, not just buying songs on i-tunes, though there would be that too. You could buy apps that display HP or reprograms your ECU or displays pictures of little red ponies – whatever yanks your chain.

    • 0 avatar
      Lorenzo

      I can see all of the black box data going to the cloud, having to pull over for interminable, frequent software updates, and having my car locked remotely for attaching an android device. And when I try to cut my losses and get rid of the car, I’ll find that under the terms of use, Apple still owns the car!

      • 0 avatar
        Big Al From 'Murica

        Probably all true, but the alternative is my Google Car reporting to anyone and everyone its location at every moment to the point of drawing a tidy little map that can be accessed on the internet and having “targeted advertising” pop up on the windshield. Ugh….Think I’m going to buy a 72 C-10.

    • 0 avatar
      Big Al From 'Murica

      Apple lives by its image of being cool and hip. I can’t imagine anyone at Apple is going to tie up with the company associated with being Al Bundy’s whip.

  • avatar
    PentastarPride

    I’d never thought that I’d swear off owning a Chrysler product, but if Apple takes over, I’m off to Mercedes-Benz for my C- or E-Class, never to own another Chrysler again.

    Apple would irrevocably destroy Chrysler (or any other auto manufacturer, for that matter). I could just imagine sealed-off maintenance items that require certified dealers to do even simple tasks like tire rotations and oil changes (which I predict to be a specially formulated concoction that won’t be found elsewhere). The engine/hybrid generator and transmission would be one integral unit–even a small failure would render the entire unit useless and would require an expensive replacement (SSD/RAM failure in your MacBook Air? The entire mainboard is gone!).

    Volkswagen/Audi would be a match made in heaven for Apple, I think. I always thought of Volkswagen/Audi as the Apple of the automotive world, but even they are not as restrictive as Apple would be. I just think of Apple when I see a Volkswagen/Audi for some reason. If anyone knows me, I don’t like Apple (I’m a Lenovo/Linux/Android guy, through and through).

    Google…I don’t know. I don’t trust any tech company to take over an automaker. If I had to choose, I think I’d pick IBM.

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