Oh, No You Don't: GM Isn't About to Let Fiat Chrysler Off the Hook

Steph Willems
by Steph Willems
oh no you dont gm isnt about to let fiat chrysler off the hook

Fiat Chrysler wants to see General Motors’ racketeering lawsuit dismissed, but the automaker’s crosstown rival isn’t in a charitable mood.

GM contends that bribery of United Auto Workers officials by FCA over years of contract talks left that automaker sitting pretty, with extra labor costs dumped on its Detroit competitors. While FCA claims GM can’t prove it’s a victim, The General says otherwise.

In a filing earlier this week, GM rejected FCA’s motion to dismiss the racketeering lawsuit. That motion came in January, two months after GM filed suit.

As reported by Automotive News, GM’s filing claims FCA’s bribery of UAW officials gave it the upper hand while at the same time heaping “outsized and asymmetrical costs” on GM via its 2015 labor contract. The automaker believes FCA, which was angling for a merger with GM at the time, hoped to weaken its rival and pave the way for the tie-up. Brokering the strategy, GM claims, was former CEO Sergio Marchionne.

An ongoing federal corruption investigation revealed plenty of illegal back-scratching between FCA and the UAW going back to 2009. That probe recently saw charges laid against former UAW president Gary Jones.

“Our brief points out a very large number of factual errors and legal deficiencies in the motions filed by FCA NV, FCA US LLC and Al Iacobelli,” GM said in a statement. “We are very confident in our position on these matters and in our RICO case as a whole, and we look forward to the next steps in the case and ultimately preparing for trial.”

In its motion to dismiss, FCA claims GM’s suit falls outside the four-year statute of limitations, claiming it must have known about its lopsided labor costs back in 2015. GM countered by saying it only learned the real story in 2017, when the federal probe collared FCA labor relations boss Alphons Iacobelli. Tasked with keeping the right UAW officials “fat, dumb and happy,” Iacobelli pleaded guilty and in 2018 received a sentence of five-and-a-half years.

Calling GM’s lawsuit “groundless,” FCA said it will continue to defend itself. This ain’t over by a long shot.

[Image: GM]

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2 of 10 comments
  • Akear Akear on Mar 11, 2020

    Well, at least the mob is not involved.

  • Detroit-X Detroit-X on Mar 12, 2020

    GM's incompetent executives and their culture of fear they created has done far more damage to GM in any one year than this FCA thing. GM will always leap at every chance to point to an outside excuse for their lame performance. Here come the "extraordinary items" against earnings, again.

  • SCE to AUX Let it die with dignity - no electrification. That would kill the spirit of the original.Mazda needs to think about survival and market share, not tinker with a niche car with waning sales, or dying on Wankel Hill.Maybe their body and paint engineers could help Tesla once Mazda folds.
  • Lou_BC H-E-L-L-C-A-T
  • EBFlex "EBFlex speaks more truth."It's sometimes a burden being right all the time.
  • MRF 95 T-Bird Add a couple of more body styles. A coupe with a vestigial rear seat like the BRZ along with a shooting brake version would appeal to a number of drivers who want something sporty but not a hatchback or crossover.
  • Theflyersfan It's the mother of all "ifs" - if Mazda gets the small rotary/hybrid combo going, I can see them using that in the next MX-5. Can they keep it under 2500 lbs and somewhat affordable? Not sure...this is why I don't run a car company! But if they want to replace it around 2025, and it's 2023 now, they need to get started very soon with some rumors and leaks to keep us going. But with the rest of their lineup going greener in next generations, and Mazda selling under 10,000 MX-5s per year, how does it really impact any average emissions and fuel economy ratings? If they can keep tweaking the Skyactiv-G engine for better fuel economy and fewer emissions, they should be able to get the NE generation using gasoline before being forced to go EV or hybrid with the NF. The mission of the MX-5 is light, affordable, open air fun and it's their halo car. And while I agree that EVs are going to be a much larger part of the future, the "all things by 2035 or 2040 or so on" edicts have "kick the can down the road" written in massive font size 1,000 written all over them. We'll be on gas for a while longer - just continue to eke more mpg out of what we have.All that being said, if they were to put the turbo Skyactiv-G engine in the MX-5 for 2024 and make it a Mazdaspeed model, I'd put a deposit on it right now. I love mine, but if it gets bumped up from 181hp to 250-275hp, it would be a flat out riot to drive.