Fiat e Chrysler secondo CNN

Via Cnn Money

The deaths of Agnelli in 2003 and his younger brother Umberto 16 months later left the company’s survival in serious doubt. That’s when Marchionne was hand-picked by longtime Agnelli confidante Gianluigi Gabetti and John Elkann, then 28, Gianni Agnelli’s grandson and heir to the family’s business empire.

Elkann decided to reinvest family money into the car business, and give carte blanche for a company-wide overhaul to Marchionne, who had risen to the top of a Swiss-based quality control company and sat for several years on Fiat’s board.

The new CEO had a three-pronged approach to turning the company around: clean house of top executives and middle managers who’d grown complacent in the final Agnelli years; forge limited partnerships with other automakers, including Tata in India; and above all, return to the core business of making affordable automobiles. “Now you have a base of top 30- and 40-something managers,” says Schivardi. “They also bet on clean technology, which acquired major value at the moment Obama was elected.”

Not surprisingly, Fiat too is suffering from a drop in sales as the auto industry reels from the global economic crisis, though the Italian government’s new-car purchase incentives have helped cushion the blow.

Ironically, Fiat’s relatively good health, and hopes that it may help rescue Chrysler, can be traced from the ashes of its last foray into Detroit. After averting bankruptcy with the help of top Italian banks, Fiat pocketed a $2 billion cash payout in 2005 from General Motors. The U.S. automaker, which had linked up with Fiat in 2000 in a joint-operating agreement and stock swap, was forced to pay the whopping sum to extricate itself from having to buy the then-struggling Italian company outright according to the terms of the original deal.

The current deal with Chrysler, which Obama wants to see finalized by the end of the month if the U.S. automaker is to qualify for the $4 billion of loans laid out by Washington, again seems to favor Fiat. With an initial stake of 20% in exchange for technology and senior-management attention, the Italians could see their share rise to as much as 55%, as Fiat gets access to Chrysler sales network in North America.

Though no monetary investment or debt risk for Fiat is envisioned at the outset, that would likely change if the Italians decide to commit to the merger. But there’s something more important than money and perhaps even small-car technology that Fiat can offer Chrysler now: its own recent experience of how to turn around a failing business model.