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Breaking: Chrysler and Fiat announce partnership


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Seriously, that 35% stake in Chrysler shouldn't even show up on Fiat's books. They paid nothing for it, therefore it is worth nothing, therefore it cannot possibly lose value.

 

It's like this battyr: If I you give me nothing and I give you a rock, how could you possibly lose money on the investment?

 

Sure, the rock's not worth much, but you didn't pay anything for it. Therefore at best you're out nothing and at worst, hey, you've got this rock, right?

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OK now, since the three headed dog could not fix Chrysler, they yelled out Fix It Again Tony!

:hysterical: :hysterical: :hysterical:

 

The Town and Country will acquire an optional espresso-maker.

 

They should have approached Automobili Cyclops SpA. A little-known Italian outfit that first appeared in the pages of R&T.

 

The link below explains. The picture is a competition rally Cyclops.

 

http://www.oldfords.org/Cyclops_home.htm

 

2005_1221Image0003.JPG

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IMHO, "bailout" loans by the Government should be for American companies only. Chrysler is now foreign controlled, and the current loans should be called back.

 

Bailouts should never be about the owners of businesses. They should only be about Jobs.

 

Last I heard, Chrysler and it's suppliers hires Americans.

 

If Toyota had problems and millions of Americans were getting laid off, then they should get a bail out too.

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If someone offered me 35% of Chrysler for free, I would take it too. But when you asked me to have my over worked and costly executives to spend a lot of time developming a rescue plan rather than running their own company, then you have a non-capital investment.

 

Again this is a private deal between Cerberus and Fiat. To me it sounds like a real good deal for Fiat and I am surprised that they did not get a deal with Renault and Nissan.

 

Time is running out for Chrysler. I wonder if Cerberus can cancel the deal if they get a better offer from Nissan and Renault? Isn't it all based on a non-binding letter. This could be a negotiation tactic. If they can't get a better deal and they can get a strong investment (technology and product development) from Fiat, then they still have something better than a fire sale.

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My take on this is that it is a steal for Fiat.

They get access to the North American market via the Chrysler dealership network.

(note that the dealers that pick up Fiat lines will pay for floorplanning, etc.)

Chrysler can rebadge Fiat small cars and sell them in North America.

(helps keep Fiat production up at minimal cost, probably paid by Chrysler any way.)

Fiat has no downside exposure, as govt. money is used to bail out Chrysler.

If Chrysler is parted out, Fiat is already "in the store" to pick up the pieces it wants.

 

The only real benefit for Chrysler is they get access to a source of small cars that are better than what they have.

 

Fiat does not need Dodge trucks, Fiat does not need Minivans. Both are pretty much North American spec vehicles that have very little demand elsewhere, so this is no channel for Chrysler products.

 

The only way that I can support continued govt. money for Chrysler is if the Fiat models they sell as rebadged Chryslers, Dodges, or Jeeps are assembled domestically. If they shut down any domestic assembly (say for the Caliber) to replace it with Fiat product assembled elsewhere, call the loans immediately!

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Even more, would partial foreign ownership invalidate terms of the initial bridge loans that wouldn't have been disbursed but for a last-ditch intervention by a lame-duck White House? The companies say no, but maybe so, says Rep. Barney Frank, D-Mass., chairman of the powerful House Financial Services Committee.

 

"It might well trigger a repayment," Frank told CNBC, referring to the Chrysler-Fiat alliance. "We put it into our bill -- and while the bill was defeated by a Senate filibuster -- the Bush administration has carried this out. We're very high in the repayment list. So, uh, depending on the deal they make it could very well trigger Chrysler having to repay the $4 billion, I think, that they got."

 

LINK

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DUUUUUUUUUUUUUUUUUUUUUUUUUHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHH

 

The loan terms should be governed by legislation that wasn't passed? You must be kidding me. You MUST be kidding me. There's no way on earth that congress has anything to say about the terms of the loan.

 

This is quite a mess.

 

Fiat wants the government to give it money so they can stage a comeback in the US, and now Congress wants to dictate terms when they couldn't even pass legislation?

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Seriously, that 35% stake in Chrysler shouldn't even show up on Fiat's books. They paid nothing for it, therefore it is worth nothing, therefore it cannot possibly lose value.

 

It's like this battyr: If I you give me nothing and I give you a rock, how could you possibly lose money on the investment?

 

Sure, the rock's not worth much, but you didn't pay anything for it. Therefore at best you're out nothing and at worst, hey, you've got this rock, right?

I could be a Jaguar Rock, in that case it would cost you money just looking at it......

 

If your rock comes with a potentially large liability, you could be buying a money pit.

Edited by jpd80
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