In an interview with the Detroit Free Press, Fiat CEO, Sergio Marchionne said that Chrysler must meet the terms of federal loans and, "stand up on its own two legs."
"If it doesn't, we won't play," Marchionne added.
That could present something of a problem for the deal considering that some on Capitol Hill are wondering aloud why federal money should go to Chrysler, which would be 35 percent owned by the Italian automaker. The U.S. Treasury has already lent Chrysler $4 billion and the company is asking for an additional $3 billion.
Adding further discontent is the speculation that Fiat will eventually own up to 55 percent of Chrysler. The additional 20 percent stake would cost Fiat $25 million as outlined in the two companies' proposed deal. That, Marchionne told the Free Press is not a given, saying that that scenario is "a long way off."
Marchionne reassured that there would be "no seepage of liquidity" between Chrysler and Fiat and said, "Fiat will not take any cash out of Chrysler not on the basis of the deal that we structured today, and certainly not until all taxpayer funds have been repaid."
In contrast to Chrysler President Jim Press' comments earlier in the week, Marchionne doesn't see any other options for ailing U.S. automaker, "I haven't seen a lineup of people at the door trying to take us out of this deal." Press acknowledged that Fiat was the only entity Chrysler was currently talking to about an alliance, but said that "we have other options."
If the deal is successful, Marchionne said, the Fiat 500 and one Alfa-Romeo could be on sale in Chrysler dealerships in about a year. Those would have to be imported from Europe, while the alliance worked to reconcile building other Fiat Group and Fiat-based Chrysler models at North American production facilities.
estreka says:
01:35 PM, 02/ 3/09
I don't see why anyone would stop Fiat. It's a devil's bargain.