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AUTO COLUMN: Can Fiat really save Chrysler?

At the New York International Auto Show in April, Chrysler President Jim Press arrived for the unveiling of the 2011 Jeep Grand Cherokee not in a Jeep, but in a Fiat 500, the little Mini Cooper-like car that Fiat sells, with success, in Europe.

At the New York International Auto Show in April, Chrysler President Jim Press arrived for the unveiling of the 2011 Jeep Grand Cherokee not in a Jeep, but in a Fiat 500, the little Mini Cooper-like car that Fiat sells, with success, in Europe.

His little stunt underscored how important Chrysler thinks its marriage to Fiat is. Fiat supposedly is the white knight, riding in to save the bankrupt Chrysler. The Obama administration seemed to buy into this, signing off on the deal in record time. The assumption was, and is, that Chrysler can't go it alone, and needs help. Enter, stage right, Fiat.

Look at the deal more closely, though, and it all seems unusual. Fiat is getting 20 percent of Chrysler, and could end up with at least 35 percent. For which Fiat is paying -- let me check the figures -- nothing.

The official statement from Chrysler: "As part of the alliance, Fiat will contribute to Chrysler its world-class technology, platforms and powertrains for small- and medium-size cars, allowing the company to offer an expanded product line including environmentally friendly vehicles increasingly in demand by consumers." Chrysler will also "benefit from Fiat's management expertise in business turnaround."

Basically, then, Fiat gets an outlet in the United States to sell its cars. Chrysler gets to -- well, sell Fiats. Several versions of the 500 will arrive here by 2011.


So who will run Chrysler? Fiat's Sergio Marchionne, chief executive officer of Fiat, will be Chrysler's CEO. The new Chrysler will be managed by a nine-member board of directors, with three appointed by Fiat, four by the U.S. government, one by the Canadian government and one by the United Auto Workers.

Oh, my. Perhaps I am being too hard on this Fiat/Chrysler "global strategic alliance." But then, I was around the last time Fiat did business in the United States, earning one of the best nicknames of all time when the suggestion was made that Fiat stood for "Fix It Again, Tony." Fiats, while great fun to drive, broke often, but that usually wasn't a long-term concern because they rusted so quickly.

Fiat formally pulled out of the United States in 1982. Its mid-engine X1-9 and 124 continued to be sold for a short while under the Bertone name, thanks to the efforts of Orlando's own Malcolm Bricklin. Then Bricklin brought back Fiat for a final fling in the mid-1980s, but you may not know that: Bricklin's $3,990 Yugo was essentially a Yugoslavian-built Fiat.

I asked several colleagues, all old enough to remember Fiat, what they think of the alliance.

Csaba Csere, former longtime editor of Car and Driver: "Fiat has never demonstrated any ability to sell cars in America in any volume. The cars have always been too unreliable, too unsuited to American needs, and too weird. It's hard for me to see how any of this has changed recently, or how hooking up with Chrysler will solve these problems."

William Jeanes, also the former editor of Car and Driver, and the publisher of Road & Track: "I can't think of a more effective recipe for automotive disaster than putting two companies with mediocre quality records into a corporation controlled by a union and overseen by a government. The word 'insanity' comes to mind."

Michelle Krebs, Detroit editor of AutoObserver.com: "Fiat has multiple images in the U.S. For older Americans who remember when Fiat sold cars here, there is the 'Fix It Again, Tony' image. Fiat has a challenge not only with perception among that segment, but also a real problem: It ranks near- to dead-last in quality surveys in Europe, and poor quality that is unacceptable in the U.S. and could do the brand in if it isn't careful.

"Young, globally savvy car buffs know about 500 and think it's cool. Still, one wonders, if this segment, will actually be able to afford the 500 or other Fiats. And then there is the segment that knows nothing about Fiat -- the clean-slate crowd. That can be an opportunity for Fiat, but also a challenge to build an image."


Let's give Fiat the benefit of the doubt, then. Remember 1978? Fiat was selling quite a few cars here, and Clint Eastwood was starring with Clyde the orangutan in Every Which Way But Loose. Eastwood went on to win four Oscars (none for that film, oddly), which in the end didn't surprise us, because we watched him get better and better.

The Fiat 500 won "European Car of the Year" for 2008. Maybe Fiat has improved, but since they weren't around for us to see progress being made, it could have happened without us knowing about it. Clint, and Clyde, meet Fiat. It's all Chrysler has, so let's hope for the best.

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