Loading…
Thursday, August 21, 2014
Current Weather
Loading Current Weather....
Published: Thursday, 1/30/2014 - Updated: 6 months ago

Chrysler, Fiat rebranded Fiat Chrysler Automobiles NV as they move forward as a single company

U.S. division contributes its earnings jump

BLADE NEWS SERVICES
The new logo for Fiat Chrysler is meant to show neither automaker is over the other. The new logo for Fiat Chrysler is meant to show neither automaker is over the other.
ASSOCIATED PRESS Enlarge

DETROIT — Chrysler and Fiat will be known as Fiat Chrysler Automobiles NV as they move forward as a single company.

Fiat’s board of directors agreed on the new name on Wednesday, with headquarters for tax purposes in the United Kingdom. But the board sidestepped the thorny political issue of whether the true headquarters would be in the United States or Italy.

Fiat’s board also wants to establish Fiat Chrysler Automobiles NV, incorporated in the Netherlands, as the parent company of the two automakers. The NV in the company’s name stands for naamloze vennootschap, a phrase used in the Netherlands to designate a public company. It is the equivalent of “Corp.” in the United States.

Fiat and Chrysler also announced fourth-quarter and full-year earnings. Chrysler’s strong profits once again propped up its parent company, which otherwise would have lost money.

Shares of the combined company will trade jointly on the New York Stock Exchange and in Milan, Italy, by Oct. 1. The company said shares will trade under the symbol FCA, which also appears on the new company logo. FCA will include the Jeep, Ram, Dodge, and Chrysler brands as well as Fiat, Maserati, Ferrari, Lancia, and Alfa Romeo.

The new company will maintain significant research, engineering, and financial operations in Fiat’s hometown of Turin, Italy, and at Chrysler’s sprawling office complex in Auburn Hills, Mich. This is an attempt to avoid political controversies in Italy, where Fiat is the largest private employer, and in the United States, where the government saved Chrysler by funding its 2009 bankruptcy.

Corporate executives, including Sergio Marchionne, CEO of both companies, say the real headquarters is on an airplane, wherever they are. Currently, the 22-member leadership team spends hours on jets flying to meetings and to visit factories and other operations.

Fiat SpA owned 58.5 percent of Chrysler Group LLC last year. It has since bought the rest from a trust fund that pays health-care bills for union retirees in order to combine the companies.

Mr. Marchionne said the new logo links the two companies “as opposed to retention of one organization over another.” Chrysler and Fiat have already teamed up to design three vehicles, the Dodge Dart compact, the Toledo-built Jeep Cherokee SUV, and the upcoming Chrysler 200 midsize car.

Mr. Marchionne said on a conference call that Fiat and Chrysler leaders are now working in unison. “I think we can move on execution at the speed of light,” he said. Consolidation of the companies, he said, makes him more confident that FCA can reach a goal of selling 1 million Jeeps worldwide this year, up from 732,000 in 2013.

The new company plans to invest $10.9 billion in product development and factories in the coming year as part of a business plan to be unveiled in May.

Chrysler said its net income more than quadrupled to $1.62 billion in the fourth quarter, boosted by strong U.S. sales and a $962 million one-time tax gain. Without the tax benefit, the company still earned $659 million, a 74 percent increase over a year earlier.

Without earnings from Chrysler, struggling Fiat would have lost $321 million, nearly double the loss from a year ago.

Mr. Marchionne told Chrysler employees they will get performance awards based on last year’s earnings. The company’s 37,200 blue-collar workers will get about $2,500 in profit-sharing.



Guidelines: Please keep your comments smart and civil. Don't attack other readers personally, and keep your language decent. If a comment violates these standards or our privacy statement or visitor's agreement, click the "X" in the upper right corner of the comment box to report abuse. To post comments, you must be a Facebook member. To find out more, please visit the FAQ.

Related stories