Fiat's Bold Move On Chrysler-Forbes

The Italian carmaker is taking a big risk in hooking up with the troubled American firm, but the idea looks good on paper.

January 21, 2009: Parmy Olson writing for Forbes reported that Fiat may have been tempting fate with its startling announcement Tuesday that it was taking a stake in Chrysler, less than two years after a previous trans-Atlantic partnership involving the American carmaker failed--still, the move looks both bold and shrewd, given the circumstances.

Fiat is in danger of following too closely in the footsteps of another European carmaker, Daimler. The German automaker's union with Chrysler ended in a bitter breakup less than two years ago. (See "Take Chrysler. Please.") Yet, history's lessons are now being overshadowed by the desperate situation in which Fiat and Chrysler find themselves: both companies are under pressure from falling demand, and both are heavily reliant on their home markets--Chrysler on North America and Fiat on Europe. A sharing of sales channels and technology may be one of the few remaining big changes that either company could make to haul itself out of difficulty.

For Complete Article CLICK HERE