Fiat Weighs Making Chryslers In Italy, Ending Magna Deal

By Gilles Castonguay
Of DOW JONES NEWSWIRES
LA SPEZIA, Italy (Dow Jones)--Fiat SpA (F.MI) will let expire Magna International Inc.'s (MGA) contract to build Chrysler Group LLC vehicles in Europe and move their production to a manufacturing site in Italy that the Italian group bought at auction this summer.

"Absolutely," Fiat Chief Executive Sergio Marchionne told Dow Jones Newswires at a company event when asked if he would let expire the contract that has seen Magna build Chrysler vehicles at its Austria plant for years.

Fiat plans to invest EUR150 million during the next three years to convert the site of niche manufacturer Carrozzeria Bertone for Chrysler product assembly. The Italian group bought the defunct car plant, which has production capacity of 70,000 cars a year, at auction in August.

Magna currently builds the Chrysler 300C and the Jeep Grand Cherokee.

The move would be a continuation of Fiat's strategy to take control of Chrysler's manufacturing. Fiat has pulled Chrysler out of a number of partnerships with the likes of Japanese auto makers Nissan Motor Co. (7201.TO) and Mitsubishi Motors Corp. (7211.TO) as it sets about restructuring the third-biggest U.S. car maker, in which it owns a 20% stake.

It is unclear whether Fiat's decision was influenced by Magna's agreement earlier this month to acquire a majority stake in General Motors Co.'s European operations, which produce the Opel and Vauxhall brands. The deal has raised fears among customers of the Canadian auto-parts maker: Germany auto makers Volkswagen AG (VOW.XE) and BMW AG (BMW.XE) have expressed concern about sharing technical secrets with a supplier that now stands to become a direct competitor in making cars....More

Chrysler to ship 400 Ohio jobs to Michigan

Workers headed to metro Detroit plants.


Chrysler Group LLC plans to offer about 400 jobs in metro Detroit to workers from its Twinsburg, Ohio, stamping plant, while the automaker prepares to freshen its slow-selling midsize sedans -- a move that could temporarily extend jobs of about 1,300 workers at the Sterling Heights assembly plant.
Twinsburg, one of eight U.S. factories not included in the government-backed sale to the new Fiat-controlled Chrysler, makes doors, roofs and hoods for the Chrysler Town & Country and Dodge Caravan minivans. It is to close by the end of this year, but most of the plant's hourly employees will be able to transfer to the metro Detroit plants, where the work is to be consolidated.---...More

Chrysler Working out it's Long term Plan

Chrysler group mulls how to make most of Fiat's technology

The Chrysler Group LLC board met in Auburn Hills on Friday to figure out how best to use Fiat engineering and technology to make future products such as midsize sedans -- and where.

The nine-member board is to provide a report to the U.S. auto task force next week.

A person familiar with the board's agenda said it included addressing the struggling sales of Chrysler's midsize sedans -- a key segment because of its volume -- and the development of replacement vehicles that will be built from Fiat engineering and components. The midsize Chrysler Sebring and Dodge Avenger, combined, have been outsold by almost 200,000 Toyota Camrys so far this year.-- More

Chrysler refines product, business plan

Alisa Priddle / The Detroit News

The board of Chrysler Group LLC will meet in Auburn Hills today to go over details of the five-year product and business plan that will be presented to the U.S. government next week and made public in mid-November.

It is a plan that has had Chrysler employees at all levels working long days and weekends to refine since the new Chrysler Group was formed June 10 in partnership with Fiat SpA. The automaker has kept most of the strategy secret as the new management team under Chief Executive Sergio Marchionne has worked to identify areas where Chrysler and Fiat engineering and technologies can be shared. Chrysler is counting on its minivans, Dodge Ram pickups, Jeep lineup and the Dodge Journey cross utility vehicle as the foundation of sales in North America while increasing sales internationally with Fiat's help.

New vehicles include the small Fiat 500 for North America at the end of next year and new versions of the Jeep Grand Cherokee and Chrysler 300.....More

Chrysler prepares to rehire some employees

After 35,000 job cuts in the past two years and a bankruptcy that shifted control to Italy's Fiat SpA, Chrysler Group is preparing to rehire an unspecified number of salaried workers and ask current workers to put in overtime to get new models to market by mid-2011, according to people familiar with the company's plans.
Chrysler and Fiat Chief Executive Officer Sergio Marchionne is to present a five-year plan to the company's board of directors Friday. If the board approves, he will submit the plan to President Barack Obama's auto task force next week, said company insiders....More

Paolo Ferrero takes over Chrysler Powertrain

A realignment of Chrysler Group LLC's powertrain division includes the appointment of a new chief from Fiat SpA.

Paolo Ferrero becomes senior vice president of Chrysler Powertrain. He comes from Fiat Powertrain Technologies, where he was vice president of product engineering. Chrysler Group is a partnership with Fiat, and small engines is one area of expertise the Italian automaker brings to the alliance.

All powertrain operations are being unified under Ferrero, who reports directly to Chrysler Chief Executive Officer Sergio Marchionne. The new powertrain division is responsible for engine manufacturing, testing and quality globally and working with the automaker's vehicle engineering group.....More

Chrysler to start leasing; dealers await sales boost

The Chrysler Group said Wednesday that it will start leasing again, a move that dealers hailed as holding the potential to improve sales.
Through August, Chrysler's U.S. sales are down 39% compared with a year ago. At the Frankfurt auto show Wednesday, Fiat and Chrysler CEO Sergio Marchionne warned of a further decline. "We are going to see harsh reality in September, it is going to drop," he told the Associated Press....More

Fiat can hit sales target with Chrysler alone

FRANKFURT (Reuters) - Italy's Fiat (FIA.MI) can reach its target of selling between 5.5 and 6 million vehicles with Chrysler alone but the group still considers renewal of Italy's car sale incentives as vital.
If the Italian government did not renew car incentives in 2010 "it would have a disastrous impact," Fiat Chief Executive Sergio Marchionne told reporters at the Frankfurt motor show.....More

Chrysler Chief Executive Sergio Marchionne Has Five Year Plan

FRANKFURT -- Chrysler Group LLC Chief Executive Sergio Marchionne said Wednesday he has designed a five-year plan for the auto maker and plans to share some of the details in November.

Mr. Marchionne, who is also CEO of Fiat SpA, said Fiat expects Chrysler's restructuring to initially progress slowly but significantly improve next year. He said Fiat is scheduled to present the plan for Chrysler by the end of November and that Chrysler will start reporting quarterly results by the end of the year.

"We are going to become a normal reporter in the U.S. hopefully by the end of 2009," Mr. Marchionne said at the Frankfurt auto show. "You will see numbers like you see for everyone else. I think we need to lift the shroud of secrecy from around the house. We have nothing to hide."

Mr. Marchionne said he had a "whole pile of surprises" when Fiat took control of the bankrupt Chrysler in June.......More

Marchionne Managing Chrysler Means 5 Mobile Devices in Backpack

Sept. 14 (Bloomberg) -- To save Chrysler Group LLC, Chief Executive Officer Sergio Marchionne has to create a mid-size sedan that can compete with the world’s best. It’s a three- to five-year job, and he may have two years to do it.

Chrysler, which got a $15 billion government bailout, may be out of cash in 24 months if he doesn’t return the Auburn Hills, Michigan-based company to profitability. Developing a car to rival perennial top sellers Toyota Camry and Honda Accord would normally take at least three years, analysts say.

Marchionne, 57, the CEO of Fiat SpA who brought that company back from near ruin, stepped into the toughest challenge of his career by taking control of Chrysler. Failure may mean not only the demise of the third-largest U.S. automaker and tens of thousands of jobs, it may prevent Marchionne from turning Turin, Italy-based Fiat into a global player.

“He’s going to have a much harder time than at Fiat,” said Maryann Keller, president of consulting firm Maryann Keller & Associates in Stamford, Connecticut. She’s covered the industry since 1972 and said the question is “whether they have time to fix the product problem before they run out of money.” ...More

Chrysler buys out engine plant in Dundee

Firm is likely to build four-cylinder Fiat motors at the factory

Chrysler Group LLC, the automaker run by Fiat SpA since exiting bankruptcy in June, said Thursday it bought out Mitsubishi Motors Corp. and Hyundai Motor Co. stakes in a Michigan engine factory.

The U.S. carmaker took full ownership of the Global Engine Manufacturing Alliance plant in Dundee, effective Aug. 31, said a statement. Financial terms weren't disclosed. The venture, formed in 2003, has been making four-cylinder engines used in Chrysler vehicles.

Buying out the two partners clears the way for Chrysler to produce Fiat-designed engines. Fiat owns 20 percent of the Auburn Hills-based automaker and can get an additional 5 percent by making fuel-efficient engines in the U.S., under terms of Chrysler's U.S. government-aided reorganization.

Chrysler probably intends to build Fiat four-cylinder engines there, said Ed Kim, an AutoPacific analyst in Tustin, Calif. GEMA is a decent engine, but with Fiat in the picture, it makes less sense to continue the GEMA relationship, especially since Chrysler and Fiat have been pretty public with their intention to incorporate small-displacement Fiat engines....Mike Ramsey and Bill Koenig / Bloomberg News

Chrysler, Fiat to share spotlight

Chrysler and Fiat will make their first high-profile joint appearance next week at the Frankfurt Motor Show, but the real collaboration on new vehicles is still 18 months to two years away, according to analysts familiar with the companies' product strategies.
While many industry observers have been anticipating the new Chrysler-Fiat product plan, that lineup is still under review by Chrysler's board of directors, including Chrysler and Fiat CEO Sergio Marchionne. Details are expected later this year.
Last week, Chrysler said it would show in Frankfurt a new 2010 version of its Dodge Caliber hatchback that will be powered by a 2.2-liter diesel engine supplied by Mercedes-Benz and a freshly designed interior.--...More

Gov to shift its stakes in GM and Chrysler to independent trust

By Silla Brush - 09/09/09 The federal government should consider shifting its massive stakes in General Motors and Chrysler into an independent trust to provide better oversight and transparency, a government watchdog panel will report on Wednesday.

The government has supported the U.S. auto industry with more than $70 billion in bailout aid and has taken large stakes in both companies as they try to dramatically revamp their operations.---...More

Chrysler: Dodge Ram No. 1 in vehicle accessories

The Dodge Ram full-size pickup boasts the most accessories of any vehicle in Chrysler Group LLC's lineup, the automaker said Tuesday.

The Jeep Wrangler is a close second, followed by the Chrysler Town & Country and Dodge Grand Caravan minivans, the automaker said.

Chrysler, which is partnered with Fiat SpA, wants to bump up awareness of the Mopar brand of accessories. Under new Chief Executive Officer Sergio Marchionne, who is also CEO of Fiat, Chrysler has restructured its management team to support four brands: Chrysler, Dodge, Jeep and Mopar.

Ram owners spend an average of $389 on Mopar accessories, with more than 70 items to choose from, the automaker said. ..More

Chryslers New Ram Plan Poses Brand Jam

Chrysler is potentially headed for a brand problem that will rival the pickle that GM is trying to extricate itself from.

Here is the deal. Chrysler has three main brands at the moment: Chrysler, Dodge and Jeep. But it has made it clear to the ad agencies pitching its ad account that it is splitting off its pickup truck and commercial vehicle business off to a new brand?Ram.

That?s right. Going forward, and as soon as Chrysler has the idea to run with, the pickup it sells now won?t be sold as Dodge Ram, but rather?.Ram. Other vehicles that will come from the Fiat-Chrysler tie up in the commercial segment will also be called Ram.

So, now we are up to four brands to support. Now, add the Fiat 500, which will be sold as a Fiat when it arrives in Chrysler showrooms in 2011. And, don?t forget Alfa Romeo, which Fiat will sell through Chrysler distribution in key markets that make sense for the Italian sport car maker.

This seems like a lot of brand differentiation to manage and support by a company that has been poor at both.

As I look at auto sales numbers through August, I see a 9.2% market share for Chrysler spread among the three brands it has. That share is inevitably going to go down as the company pares models. Indeed, Merrill Lynch projects that Chrysler loses a whopping five to six points of share in the next four years unless it comes up with some product surprises from the Fiat alliance.--...More

Company will add 10,000 units to Dodge Caliber production this year

AUBURN HILLS, Mich., Sept. 2 /PRNewswire/ -- Anticipating customer demand for
the fuel-efficient Dodge Caliber, Chrysler Group LLC is returning the second
shift of production at the Belvidere (Ill.) Assembly Plant effective October
5, 2009.

The action will increase Dodge Caliber production by 10,000 units for the
North American and international markets through the end of the year, while
maintaining planned production levels of Jeep(R) Compass and Patriot, the
other fuel-efficient Chrysler Group vehicles built at the facility in
Belvidere, Illinois.

"We are taking this action in response to increasing demand for our most
fuel-efficient products," said Michael J. Accavitti, President and CEO, Dodge
Brand, Chrysler Group LLC. "However, we are cautious about the continued
volatility in the industry and will monitor demand in order to respond to
market conditions."

The increased second shift production will add approximately 850 employees at
the Belvidere facility. This action is in addition to the more than 50,000
units added to production plans at other Chrysler Group plants, that was
announced earlier this week.

The 2009 Dodge Caliber offers top government safety ratings, value, bold
styling and many interior innovations in a compact car that combines Dodge
attitude, SUV versatility, fuel efficiency and affordability.

Old Chrysler defaults on loan payment

The portion of Chrysler LLC that remains in bankruptcy had costs of $10.2 billion in June, which is more money than the company was left with to cover the costs of liquidation.--< a href="http://www.detnews.com/article/20090905/AUTO01/909050313/1148/rss25">More

Old Chrysler's costs outstrip assets

The portion of Chrysler LLC that remains in bankruptcy had costs of $10.2 billion in June, which is more than the amount the company was left with to cover the costs of liquidation.
The June operating report for Old Carco LLC, the name for the bankrupt pieces of the automaker, was filed with the New York bankruptcy court Friday. Chrysler LLC filed for bankruptcy April 30, and the choice assets were sold to a new entity, Chrysler Group LLC, which was formed in partnership with Fiat SpA on June 10.

Former Chief Financial Officer Ron Kolka was put in charge of winding down the assets of Old Carco, which contain seven assembly plants, almost 3,000 vehicles valued at $51 million and contracts with dealers and suppliers that were not transferred to the new Chrysler.--...More

Chrysler Showing interest In Closed GM Plants

Prospective buyers eyeing sites considered difficult to unload

Foreign and domestic automakers have expressed interest in buying factories being sold by the former General Motors Corp. as part of its bankruptcy case.

The others are located in Wilmington, Del., Shreveport, La., and Moraine, Ohio. The old GM also has five stamping and six powertrain plants.

Industry analysts said any of the assembly plants would give a foreign automaker, perhaps a Chinese or Indian company, entry into the U.S. market or might interest Chrysler Group LLC, which will produce cars made in conjunction with its new partner, Italy's Fiat SpA...More

Several models sell out in August

Chrysler Group LLC today reported a 5 percent sales increase compared with July 2009 despite low inventory levels on a number of popular nameplates.

Dealership traffic continued at a high level during the month of August, in part due to the U.S. government’s Car Allowance Rebate System (CARS), more commonly known as “cash for clunkers.”

“Chrysler Group had another strong sales month in August with the majority of Chrysler Group nameplates posting year-over-year or month-over-month sales improvements,” Peter Fong, President and Chief Executive Officer–Chrysler Brand and Lead Executive for the Sales Organization, said. “The CARS program gave a boost to the industry in August, and as a result, we’ve increased production by more than 50,000 units, our factories are full-steam ahead building Chrysler, Jeep® and Dodge vehicles for customers and replenishing dealer inventories.”
The Chrysler Group reported total U.S. sales for August of 93,222 units, an increase of 5 percent compared with July and a decrease of 15 percent compared with the same time period in 2008. Retail sales for August were 68,958 units. The company finished the month with 100,238 units in inventory, representing a 28-day supply. Inventory is down 74 percent versus August 2008 when it totaled 380,560 units. Overall industry figures for August are projected to come in at an estimated 14.4 million annual sales rate.

“Chrysler Group’s large car, minivan, crossover and truck segments all posted increases in retail sales in August,” Steven Beahm, Vice President–Sales Operations, said. “The Dodge Avenger, Dodge Grand Caravan and Chrysler PT Cruiser were very popular with consumers looking for high-quality, fuel-efficient vehicles.”...More

Chrysler Group Sells Out of Many Chrysler, Jeep and Dodge Vehicles In August

Chrysler Group LLC reports August U.S. Sales Increases

AUBURN HILLS, Mich., Sept. 1 /PRNewswire/ --

-- Chrysler Group LLC U.S. sales up 5 percent compared with previous
month
despite low inventory levels on several vehicles
-- Seventeen out of 26 nameplates post year-over-year and/or
month-over-month retail sales increases, including five out of six
Jeep(R) nameplates
-- Jeep Grand Cherokee sales up 62 percent versus previous year
-- Dodge Grand Caravan sales increase 13 percent compared with August
2008
-- Chrysler 300 sales increase 17 percent compared with August 2008
-- Chrysler PT Cruiser retail sales increase for second consecutive
month,
up 100 percent compared with August 2008

-- Mopar(R) parts and accessories sales increased 5 percent compared with
July


Chrysler Group LLC today reported a 5 percent sales increase compared with
July 2009 despite low inventory levels on a number of popular nameplates.
Dealership traffic continued at a high level during the month of August, in
part due to the U.S. government's Car Allowance Rebate System (CARS), more
commonly known as "cash for clunkers."

"Chrysler Group had another strong sales month in August with the majority of
Chrysler Group nameplates posting year-over-year or month-over-month sales
improvements," said Peter Fong, President and Chief Executive Officer-Chrysler
Brand and Lead Executive for the Sales Organization, Chrysler Group LLC. "The
CARS program gave a boost to the industry in August, and as a result, we've
increased production by more than 50,000 units, our factories are full-steam
ahead building Chrysler, Jeep(R) and Dodge vehicles for customers and
replenishing dealer inventories."

Chrysler Group reported total U.S. sales for August of 93,222 units, an
increase of 5 percent compared with July and a decrease of 15 percent compared
with the same time period in 2008. Retail sales for August were 68,958 units.
The company finished the month with 100,238 units in inventory, representing a
28-day supply. Inventory is down 74 percent versus August 2008 when it totaled
380,560 units. Overall industry figures for August are projected to come in at
an estimated 14.4 million SAAR.

"Chrysler Group's large car, minivan, crossover and truck segments all posted
increases in retail sales in August," said Steven Beahm, Vice President-Sales
Operations, Chrysler Group LLC. "The Dodge Avenger, Dodge Grand Caravan and
Chrysler PT Cruiser were very popular with consumers looking for high-quality,
fuel-efficient vehicles."

August Brand Sales Highlights

-- Seventeen out of 26 nameplates posted year-over-year and/or
month-over-month retail sales increases, including five out of six
Jeep
nameplates. Nameplates with increased retail sales are:
-- Chrysler Sebring Sedan/Convertible, Chrysler 300, Chrysler PT
Cruiser, Chrysler Town & Country, Jeep Wrangler, Jeep Liberty,
Jeep Compass, Jeep Grand Cherokee, Jeep Commander, Dodge Caliber,
Dodge Avenger, Dodge Charger, Dodge Challenger, Dodge Journey,
Dodge
Dakota, Dodge Ram and Dodge Sprinter
-- Jeep Grand Cherokee U.S. sales increased 62 percent (7,679 units)
compared with August 2008 and 118 percent versus the previous month
-- Chrysler 300 U.S. sales increased 17 percent versus August 2008 (4,320
units) and increased 88 percent versus July
-- Chrysler PT Cruiser retail sales were up 100 percent (3,819 units)
compared with August 2008 and increased 45 percent compared with July.
August is the second consecutive month of year-over-year sales
increases
for Chrysler PT Cruiser
-- Dodge Grand Caravan U.S. sales were up 13 percent (10,648 units)
compared with August 2008 and increased 27 percent versus July,
representing the second consecutive month of sales increases
-- Dodge Avenger U.S. sales increased 16 percent (4,118 units) compared
with August 2008
-- Mopar(R) parts and accessories sales increased 5 percent compared with
July

-- Mopar introduces new accessories that will help consumers Refresh
their
Ride, including: New Garmin(TM) nuvi(R) navigation systems, new Jeep
Wrangler door kits and 2010 MY Dodge Ram chrome accessories


Incentives

Chrysler Group LLC today announced the following incentives valid today
through September 30, 2009:

2009 Model Year Vehicles:
Chrysler Group is pleased to offer 0 percent financing for up to 72 months
through GMAC Financial Services or up to $4,500 Consumer Cash on select 2009
model year Chrysler, Jeep and Dodge vehicles.

2010 Model Year Vehicles:
On select 2010 model Chrysler, Jeep and Dodge vehicles, limited Consumer Cash
of up to $2,000 or attractive financing rates through GMAC Financial Services
are available.

About Chrysler Group LLC
Chrysler Group LLC, formed in 2009 from a global strategic alliance with Fiat
Group, produces Chrysler, Jeep, Dodge, Mopar and Global Electric Motors (GEM)
brand vehicles and products. With the resources, technology and worldwide
distribution network required to compete on a global scale, the alliance
builds on Chrysler's culture of innovation - first established by Walter P.
Chrysler in 1925 - and Fiat's complementary technology - from a company whose
heritage dates back to 1899.

Headquartered in Auburn Hills, Mich., Chrysler Group LLC's product lineup
features some of the world's most recognizable vehicles, including the
Chrysler 300, Jeep Wrangler and Dodge Ram. Fiat will contribute world-class
technology, platforms and powertrains for small- and medium-sized cars,
allowing Chrysler Group to offer an expanded product line including
environmentally friendly vehicles

Dodge Ram pickup is only new Chrysler for '10

Chrysler has only one all-new vehicle for 2010 but is adding fuel-efficient versions of existing products and making more features standard in a lineup that must carry it through next year.

Competes with: Ford F-Series, Chevy Silverado
Looks like: A bigger version of the redesigned Ram 1500
Drivetrain: 383-hp, 6.7-liter diesel