Fiat Merger Won't Happen Under Marchionne's Watch
Fiat Chrysler Automobiles chief Sergio Marchionne told Bloomberg on Monday that his company likely wouldn’t merge with another automaker before his tenure is up in 2018.
The chief executive publicly courted General Motors in 2015 to merge two of the Big Three. GM CEO Mary Barra publicly refuted that partnership, and Marchionne seems to have gotten the hint.
“I met Mary Barra less than a month ago in Washington,” Marchionne told Bloomberg. “I don’t think I will have another coffee with her. It won’t happen again in the future.”
Marchionne said any merger would have to be done after he leaves — in 2018.
Until then, the automaker plans on hitting its same ambitious sales targets, Marchionne told Bloomberg, including 7 million sales by 2018 — 2 million more than many estimate the carmaker will actually sell.
According to the report, Marchionne said he shrugged offers from other automakers that weren’t as promising as a Fiat-GM alliance, but we’re not here to talk about the past anymore, you guys.
Instead, Marchionne and FCA will go at it alone and continue its ambitious $52 billion investment plan that started by spinning off Ferrari. Sales of FCA shares dropped sharply Monday as Ferrari began trading on its own, separate from FCA.
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Both GM and FCA have significant weakness. If GM can nail its next gen compact, midsize, and large crossovers which they will release for each 4 brands, then they may do well after all. FCA's debt levels, delay of fresh product mix, and reliance on fleet sales shows their vulnerability. Their reliability and quality still aren't great. I don't understand how Fiat Europe has done so badly still. Maybe with VW distracted by its emission scandal will other major European makes be able to turn their operations around quicker. I kind of do hope for a merger or FCA sells off some brand. Jaguar Land Rover has done really well under Mahindra. I bet another auto maker willing to shell out some capital could have done well with Alfa Romeo, Lancia, or even Dodge or Chrysler. And if we are talking about selling off the Crown Jewels, GM should just sell Cadillac. Somebody else willing to invest correctly could bring back that marquee to its former glory. GM really doesn't have the money or know how to make it a true competitor to BMW/Mercedes/Lexus.
I think that Sergio was turned down by a few other auto manufacturers. Sergio hasn't found anyone who will pay him for taking them over. Maybe Sergio is losing his touch.
“I met Mary Barra less than a month ago in Washington,” Marchionne told Bloomberg. “I don’t think I will have another coffee with her. It won’t happen again in the future.” Playa done lost his game...
Recycled Fiats is not a very attractive offer for any auto manufacturer. Mary would rather pay for her own cappuccino.