Fiat-Chrysler cross-cultural alliance

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News in that For Chrysler has created an alliance with Fiat.  The American car maker is under pressure by the U.S. government to restructure in order to save the company and jobs in the wake of the credit crunch. An alliance with Fiat holds the promise of more attractive small, fuel-efficient cars for Chrysler down the road as well as better access to important global markets. Up to now, Chrysler hasn’t been competitive in either area.

On Tuesday, the companies announced the basic terms of a tentative “global strategic alliance”: Fiat, Italy’s largest automaker, will provide no cash of its own to the struggling American automaker. Instead, in exchange for a 35% equity stake, Fiat will provide Chrysler with “technology,” including the engineering underlying some of Fiat’s small cars, which have proven popular in Europe.

“They’ve got some beautiful stuff over there,” said Magliano, “and a lot of these things can be sold in the U.S.”

Unlike Chrysler, Fiat is known to specialize in small, fuel-efficient cars that are popular in Europe. But the sort of “platform sharing” envisioned for Chrysler and Fiat takes years to bear fruit, so don’t expect to see a Dodge version of the Fiat Punto at your Chrysler dealer anytime soon, said Magliano.

“It’s difficult to have cross-cultural alliances like this,” Magliano said, adding that language and cultural differences, as much as anything else, can hamper progress.

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