Fiat will provide Chrysler with new distribution networks, including those outside of North America, as part of the global strategic alliance announced yesterday.
The new alliance, which is designed to contribute to Chrysler’s restructuring plan, will allow the carmakers to access each others markets via existing distribution routes and optimise supplier bases, though exact details of logistics provision are yet to be announced. Chrysler spokesman David Elshoff told Automotive Logistics that distribution capabilities were central to the discussions but that it was premature to offer further details. The agreement is expected to be complete by April this year, subject to US Treasury approval.
“In terms of distribution strengths and opportunities, Fiat has exceptional distribution networks in Europe and Latin America, while Chrysler has a robust North American wholesale and retail channel with 85 years of history,” said Elshoff.
Fiat will take an initial 35 per cent equity interest in Chrysler for its provision of access to new markets, as well as product, platform and technology sharing. Fiat is expected to equip a Chrysler plant in the US for production of Fiat vehicles.
CEO of Fiat Group, Sergio Marchionne stated: “The agreement will offer both companies opportunities to gain access to most relevant automotive markets with innovative and environmentally friendly product offering, a field in which Fiat is a recognised world leader, while benefitting from additional cost synergies.”
Chrysler’s CEO Bob Nardelli added: "A Chrysler/Fiat partnership is a great fit as it creates the potential for a powerful, new global competitor, offering Chrysler a number of strategic benefits, including access to products that complement our current portfolio, a distribution network outside North America and cost savings in design, engineering, manufacturing, purchasing and sales and marketing."