Fiat could use Chrysler factories for US Alfas
16 April 2008

Chrysler is in advanced discussions with Fiat over plans to use the American company’s factories to build US-market Alfa Romeos, according to reports in the German press.The news comes just a day after Chrysler announced a similar co-operation with Nissan over the production of new models, including building a US-market pick-up truck for the Japanese manufacturer. Fiat has been looking for a partner to help with the return of Alfa Romeo models to the US market for some time. The Italian company has already indicated that it will initially export cars from Europe to the US, but local production would put it in a far stronger position in the price-conscious American market. Fiat is already a global expert in localising production for foreign markets, with subsidiary factories in Poland, Argentina and Brazil, and joint ventures with numerous other car makers, from Egypt to Serbia. And Chrysler certainly has production capacity to spare, with its share of the US market declining dramatically in recent months. Sales in America were down 16 per cent year-on-year in March. Several models, including the Jeep Commander, are believed to be facing the axe.Alfa Romeo withdrew from the American market in 1995, and has been planning to return for some time. The current plan is for new Alfas will be sold from American Maserati dealerships.

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21 April 2008

This is exactly what I said that Ford should have done. Off loaded some of its spare capacity to other brands, giving it time to restructure the parts in the US that are losing money. Europe Ford is profitable, yet it's cut loose areas where cash could be generated in the short term future in Jaguar (the bundle with Land Rover are profitable). At the very least it should be building Jaguar cars in the US for the US market, and exporting them back to the UK / Europe.

Chrysler would do better buying technology from Europe to make better cars. Ones that score better than a dismal EuroNCAP rating for driver safety. What Fiat have to lose is that they may well learn from them, without having to pay for the expertise.

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