fiatrchrysler merger

August 2011

① History ② New merger③ Reasons④ Leadership⑤ Conclusions

First car the 3 ½ CV (1899)

• Fiat S.p.A., an acronym for Fabbrica Italiana Automobili Torino (English: Italian Automobile Factory of Turin),

• Giovanni Agnelli founded Fiat in 1899 with several investors and led the company until his death in 1945, while Vittorio Valletta administered the firm's daily activities

• Fiat is the largest vehicle manufacturer in Italy, with cars ranging from small Fiat city cars to sports cars made by Ferrari, and vans and trucks such as the Ducato.

Operations in:• Automotive Components• Passenger Cars• Commercial Vehicles • Metallurgical products• Production systems• Construction• Information technology• Publishing and communication• Services

• US-based company• Founded in 1925 by Walter Chrysler• The original 1924 Chrysler included a carburetor

air filter, high compression engine, full pressure lubrication, and an oil filter, at a time when most autos came without these features .

Walter Chrysler

“Chrysler Six” , 1924.

• HQ in Detroit• Operations in:

• Cars• Minivans• Sport-utility vehicles• TrucksIn 1998 Daimler-Benz and Chrysler had

formed a 50-50 partnership.Chrysler sale to Cerberus 2007-2009.On May 1, 2009, Chrysler LLC filed for

bankruptcy

• In 20 January 2009, the two automotive giants decided to merge.

• Fiat's on 22nd of July 2011 -53.5% stake in Chrysler, and plans for new management, is making for a healthy corporate marriage. There's (an element of) equality, give-and-take, and both sides are optimistic about the future

• What Fiat brings to the table: The company has the capital, new technologies to develop high-efficiency cars, and reverence from Ferrari and Maserati fans. 

• What Chrysler brings to the table: The 3rd-largest U.S. auto company is a trusted brand with international appeal. 

• Fiat Auto plans to sell seven of its vehicles in the US by 2014

• Fiat-controlled Chrysler Group is to supply nine models to sell under Fiat brands in the European market

• Exchange of technology• The goal: The partnership would

provide each company with economies of scale and geographical reach at a time when both are struggling to compete with larger and more global rivals like Toyota, Volkswagen and the alliance of Renault S.A. and Nissan

Sergio Marchionne (born June 17, 1952 in Chieti, Abruzzo)

Marchionne returned Fiat's automobile division (Fiat Group Automobiles S.p.A.) to profitability in 2006. He has been widely credited with turning the group around to become one of the fastest growing companies in the auto industry

When Chrysler emerged from Chapter 11 bankruptcy on June 10, 2009, Fiat Group received a 20% stake in Chrysler Group LLC. Marchionne subsequently replaced Robert Nardelli as CEO of Chrysler, and has since been the CEO of both the Fiat and Chrysler Groups

• It is a key step toward achieving Marchionne's goal of creating a global automotive player with Chrysler to build 6 million cars a year by 2014.

• Sergio Marchionne remain CEO of Chrysler in North America, and make Detroit a central part of its operations.

• This restructuring is unlike other mergers. Rather than replace all the Chrysler execs, Marchionne is keeping them on board.

• Human Due Diligence is the most appropriate first step to solve the problems of the Chrysler case.

• Following, a combination of all suggested alternatives would be ideal.

• Effective leadership involves assessing the group’s style and stage of development and then using a matching leadership style. If the style of the leader and the needs of the group are mismatched, the group will be unproductive. Leaders also need to adapt their style to the urgency of the task to be accomplished.

• Inspire with a mission lead from the heart with passion and compassion.

• Be adaptable. Keep resourceful. Have the courage to do issues in another way.

• Decide your battles - know your non-negotiables.

• Unique• Passion • Perfectonist• Decisive• knowledgeable