Marchionne May Marry FCA To Apple, Google If No Automaker Will
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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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.
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.