Will Chrysler’s savior walk away?

Will Chrysler and Fiat bring the U.S. cars like this?

Will Chrysler and Fiat bring the U.S. cars like this?

Chrysler’s been hyping their alliance with Fiat as their saving grace – their advantage over the competition as an efficient way to introduce small, cool, gas-sipping cars to the U.S. market.

Now, though, Fiat may be realizing the mess they’re getting themselves into, because they’ve threatened to walk away if Chrysler can’t cut costs. I can just imagine Fiat CEO Sergio Marchionne looking at Chrysler’s books and saying, “Oops. Maybe we should have looked at this before we announced a partnership.”

It’s got to be embarrasing for Chrysler, if not a motivation to quickly fix their financials. 

Marchionne said,

Absolutely, we are prepared to walk. There is no doubt in my mind. We cannot commit to this organization unless we see a light at the end of the tunnel.

Ouch. If he does see that light, though, Marchionne is prepared to offer himself up as Chrysler’s CEO and split his time between running both companies.

In my opinion, the drastic cost cuts are unlikely, because they require substantial union labor cost reductions… by the end of this month. If by some miracle Chrysler can comply with Fiat’s demands, Marchionne as CEO would be huge for Chrysler. He’s the guy who’s taken Fiat from laughing stock to Euro-cool. 

Chrysler needs a guy like that, but the odds of getting him are dwindling.

Would your opinion of Chrysler change with Fiat’s CEO at the helm?

-tgriffith

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