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Gerardo: First of all I really doubt that Fiat is making any real great profit from Ferrari or Maserati. Fiat on it own could never produce an engine like the new generation Chrysler Hemi.

As for performance the American cars like Corvette and the Dodge Viper will hold their own against anything that Ferrari builds.

Fiat may need Chrysler more than Chrysler needs Fiat. Right now Fiat tuning to banks to borrow more than $6 billion dollars to get them through these bad time. I believe that sales of Fiat have plunged more than 70% i this last year.

The reason that Fiat is willing to take a 35% share in Chrysler is because they don't have the cash to start from scratch to build factories and a dealership network to sell its autos in the US. The only reason that Fiat was able to obtain a 35% share of Chrysler is because Cerberus the parent company of Chrysler wants to get out of the auto business.

The reason that Chrysler is in such bad shape is because of the way Mercedes ran Chrysler.

John F. Shireman

And on a related note:http://autos.yahoo.com/articles/autos_content_landing_pages/846/dishonorable-mention-the-10-most-embarrassing-award-winners-in-automotive-history

Reading the automotive news this about Fiat has been very interesting to say the least.

Since announcing a deal to obtain a 35% in Chrysler, Fiat also announce a deal with BMW. The $6.4 billion that I reported that Fiat was trying to borrow turns out that the money would be used instead to buy a controlling interest in Peugeot Citroen Group. If this deal would go through it would make Fiat the third largest auto company in the world
ranking only behind Toyota and GM.

It has also been reported that the Agnelli family which owns a controlling interest of 30% in Fiat, has increased their investment in Fiat to over $ 2.5 billion. This was done so that if the merger with Peugeot Citroen group takes place, they would retain controlling interest in the newly merged companies.


John F. Shireman

And let me address the quote:


"First of all I really doubt that Fiat is making any real great profit from Ferrari or Maserati. "

Oh really?

From the Times:

"Last year, turnover hit ?1.67 billion, producing a profit of ?266 million. That figure is set to rise, giving Ferrari a pre-tax profit margin of 19 per cent by 2010, according to Morgan Stanley, compared with 15.9 per cent last year. On that basis, it would be more profitable than Porsche, often thought of as the world's most profitable carmaker."

http://business.timesonline.co.uk/tol/business/industry_sectors/engineering/article4326982.ece

And this:

"As for performance the American cars like Corvette and the Dodge Viper will hold their own against anything that Ferrari builds."

Who knows... Consumer Reports might very well agree... but it's a false argument really. Ferrari is in a completely different class and price range. Just as you can't compare a Cadillac to a Rolls.

Perhaps one should ask: could any American manufacturer build an auto like the Ferrari... that level of style, sophistication and world-wide desirability? I don't think so. Ferrari owners do not lust after Corvettes... or Vipers (for God's sake) but I'm sure plenty of Corvette and Viper owners would love to own a Ferrari.

And also

"The reason that Fiat is willing to take a 35% share in Chrysler is because they don't have the cash to start from scratch to build factories and a dealership network to sell its autos in the US. The only reason that Fiat was able to obtain a 35% share of Chrysler is because Cerberus the parent company of Chrysler wants to get out of the auto business."

If Chrysler were a truly worthwhile company it would not find it's self in this pathetic position:

From Edmunds:

"Fiat reportedly is considering taking another 20 percent of Chrysler but will pay for this one, albeit still a pittance. Word is it will decide within the year if it will take the added stake and pay Chrysler $25 million for it. Reuters, quoting a source close to the Fiat industrial group, said Fiat's decision to add the stake will depend on whether it sees Chrysler as having a chance to survive as a going concern."

http://www.autoobserver.com/2009/01/threesome-fiat-looks-to-link-with-peugeot-as-well-as-chrysler-reports-say.html

Gerardo: Well I guess I stand corrected about Fiat and profit made by Ferrari.

How ever I must point out that the article you quote your figures concerning Ferrari's growth rate and pre tax profits through 2010 on projections made by Morgan Stanley
don't hold much water these days. The article was written back in July 2008 since then the economic climate in the world has changed, so the figures quoted aren't worth anything some almost seven months later.

It is very interesting how Fiat helps prop Ferrari up with selling most of its engine production to another company owned by Fiat MASERATI.

Like I stated before Fiat doesn't have the money on hand to start up production and build up a dealer network from scratch in the US. The over $ 6 billion dollars that Fiat is trying to borrow to purchase the two French companies is proof. Think they might have a tough time trying to raise that much money since Fiat is only valued at $ 7.5 billion dollars.

If it wouldn't have been for the payment of $ 3.1 billion dollars made by GM to Fiat in 2004 and the back door help by the government of Italy, Fiat might not be in business today.

I might ad that part of the reason that Chrysler is in such bad shape today is because of another Euro company located in Germany that mis managed Chrysler.

Don't take me wrong I like the super performance cars produced in Italy. Like I have stated in the past about Rolls Royce over hyped and over priced. I think the same thing pertains to the Italian super cars produced in your nation.

$ for $ the American super cars like Corvette and Viper are a better valve and will match for performance anything produced in your country.

John F. Shireman

Agreed....dollar for dollar... pound for pound, Corvette is a better value.

And WalMart is a better then value than Prada.

And JC Penny's is a better value than Gucci.

And K-Mart is a better value than Ferragamo.

dollar for dollar... pound for pound...

----

Mercedes mismanaged Chrysler? Or was Chrysler impossible to manage?

Sorry... but I'll put my faith in Mercedes... perhaps the world's premier automaker.

"Like I stated before Fiat doesn't have the money on hand to start up production and build up a dealer network from scratch in the US."

Uh so? And does Chysler have the money on hand to start up production and build up a dealer network from scratch in the world markets that Fiat is in?

"It is very interesting how Fiat helps prop Ferrari up with selling most of its engine production to another company owned by Fiat MASERATI."

Is it strange that engines are shared among Fiat brands?

IMHO, and it's just that, my opinion, just about anything Italian is preferable to anything American made, Italian cars, Italian bikes, Italian food, Italian women.... if I didn't know any better, I'd say I probably have a little Roman Centurion blood in my family from way back when. I can't help it, I have a taste for the finer things in life, and those usually have the words "Made in Italy" in there somewhere.

Turbopackman "just about anything Italian is preferable to anything American made".

It is this sentiment (substitute German, French, Japanese) that has made America what it is today-a third world has been.

To put this into a Packard perspective apparently Enzo Ferrari as a youth was so impressed by the power and smoothness of a Packard Twin Six that later in life when he began buildng cars he chose the V-12 configuration for the engines. A friend of mine owned a 1966 Ferrari 275GTB and to my gearhead ear there is no finer sound coming from an engine than that of the Ferrari V-12 in "full song".