Fiat and Chrysler CEO
Sergio Marchionne has softened his language somewhat
after his controversial comments last weekend saying
yesterday in Chicago that he must be more open about
matters of corporate governance between the two
companies and that Italian concerns about a shift away
of the powerbase were overblown.
Last Friday Marchionne,
speaking at the JD Power Automotive Roundtable
conference in San Francisco stirred a hornets nest by
telling his audience that Fiat and Chrysler could merge
within the "next two or three years" and the new
entity's headquarters would most likely be located in
North America. Once Chrysler has undertaken a public
offering Marchionne doesn't see the need for two
separate corporate structures (Fiat is listed on the
Milan bourse).
Those comments however
caused a wave of reaction in Italy, most notably in
Turin, Fiat's hometown for all its 111 year existence,
with the city's mayor demanded "immediate
clarification", while opposition politicians were quick
to blame the government for the situation. Over the
weekend Marchionne, along with Fiat Chairman John Elkann,
did very little to douse the fires, the hurried line
that they spun being that there would in fact be four
headquarters globally in the future (in Brazil and Asia
as well as Turin and Detroit), a line which was then
quickly dropped.
Industry insiders see
a merger between the two car companies in the future as
being the logical route once Chrysler has accomplished a
series of hurdles set when it grasped U.S. and Canadian
state government lifelines two years ago as it sank
under a tide of debt and collapsing vehicle sales.
Foremost is paying these 'taxpayer' loans off, or as is
more likely, renegotiating them, before Chrysler follows
the recent path of its Detroit rival and Chapter 11
bedfellow in heading for an IPO.
However a softer line
has emerged this week from Marchionne who is set to meet
embattled Italian Prime Minister Silvio Berlusconi and
Economic Minister Giulio Tremonti, Industry Minister
Paolo Romani, Labour Minister Maurizio Sacconi and
Cabinet Undersecretary Gianni Letta.
In Chicago yesterday
for the opening of the auto show where the Chrysler
Group's Dodge brand rolled out a series of
sports-focused models across its full range, Marchionne
said that he must be more open about corporate
governance matters between the two companies in the
future. And referring to the storm of controversy he set
in motion across Italy last weekend he said: "It was a
typical overreaction to an honest reflection of the
issues that must be dealt with."
