Fiat wil ook fuseren met Opel (en)
Italian car firm Fiat, which last week secured rights to a 20 percent stake in American automobile giant Chrylser, signalled over the weekend that it is also interested in a merger with embattled European carmaker Opel.
Top Fiat officials will meet German economy and foreign ministers on Monday (4 May) to discuss the basis of a deal.
Fiat's chief executive, Sergio Marchionne, told the Financial Times over the weekend: "From an engineering and industrial point of view, this is a marriage made in heaven," adding that he hopes the deal will be completed by the end of May.
Opel, whose car plants are based largely in Germany, is owned by the struggling General Motors, which has until 1 June to restructure if it is to receive badly needed loans from the US administration.
Earlier this year, its management turned to the German government for a €3.3 billion bail-out that it says is necessary to survive the current economic slump.
However, the German government favours a private sector takeover or merger, but indicated that the new investor would be eligible for state support provided factories were kept open.
Fiat's announcement over the weekend sees it join Canadian car parts maker Magna International which recently expressed an interest in taking over Opel and has presented the German government with proposals.
However, Mr Marchionne's merger plans also include the other GM subsidiaries in Europe, primarily Vauxhall in Britain and Saab in Sweden.
American woes offer new dawn for Fiat
Under pressure to convince the Obama administration by the 1 June deadline that it is a viable company, GM announced last week that it intends to phase out 21,000 jobs and drop the Pontiac brand.
Chrysler on the other hand failed to secure a conclusive deal with debt holders by the 30 April deadline and has now filed for bankruptcy proceedings in the US.
But an agreement reached between the American manufacturer, the Obama car team and Fiat will see the Italian carmaker take a 20 percent stake in a new, slimmed down Chrysler once it emerges from the bankruptcy proceedings.
Added to this, if Mr Marchionne is able to convince the German government that Fiat is best placed to save German jobs in an election year, the move has the potential to create a new car superpower, whose sales would be second only to Japan's Toyota.
With GM's European plants based largely in northern Europe, Fiat plants in Italy and Chrysler plants in the US, the new company would be well placed to operate on a global level.
The Italian government last week threw its full support behind the 20 percent stake in Chrysler.
"A Fiat that is stronger in the world will be stronger in Italy and will make Italy stronger in the world," said Italian industry minister Claudio Scajola.
The stake in Chrysler and potential deal with takeover of GM's European subsidiaries mark a huge turnaround for the Italian carmaker that has traditionally been seen as one of the weaker carmakers on the global scene.
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