ANALYSIS: Fiat-Chrysler merger brings birth of a new auto giant - Prana Natarajan, Senior Research Analyst at Frost & Sullivan, reviews the creation of the new auto giant.
In this analysis, Natarajan touched on the merger between Daimler and Chrysler. It was touted as “A merger of equals.” The union did not last and Daimler sold its stake in Chrysler in 2009.
Moreover, Natarajan asks the question, is Chrysler an expense or an investment for FIAT? It appears that the merger is taking shape and making sense for both auto entities.
Due to their leadership skills and performance, twenty five executives were hand selected by FIAT and Chrysler CEO Sergio Marchionne. Decisions for each major geographic division are made by that particular geographic headquarters. In doing so, this decentralized the decision making process and alleviated any unnecessary mirroring positions.
Next the author looked at how the merger between American auto maker Chrysler and Italian auto giant FIAT has meshed well together. Chrysler’s expertise is with bigger cars, SUV’s and trucks, while FIAT’s expertise with small cars and diesel vehicles. What one lacks, the other makes up for to make a truly beneficial partnership.
Analysts forecast that the FIAT-Chrysler group is expected to produce a 61% increase by 2018. It is assumed that production values in the America’s will drop. On the other hand, the production values in Asia are expected to sky rocket to 9% from its current 2% by 2018.
FIAT – Chrysler is now the seventh largest automaker. Their aim is to be the sixth largest automaker by 2014.
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