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Fiat board makes Chrysler merger official, approves $5.4B bond sale

Fiat's board of directors has officially approved the merger plan that will see the conglomerate's automotive operations merged with Chrysler into the new Fiat Chrysler Automobiles.
The plan essentially provides a road map for the structure of the new company. It includes provisions for Fiat shareholders - one Fiat share will translate to one share of FCA common stock. The new company will also include a loyalty voting structure, which will provide for shareholders of Fiat stock or those that have held FCA stock for at least three years. According to the plan, these shareholders would see their voting power double, with two votes for every share of FCA's common stock. The overall merger plan still needs to be approved by the company's shareholders.
In other Fiat-related news, the company's board has announced a bond issuance of four billion euro ($5.4 billion). The new bonds should provide the company with a degree of flexibility in refinancing debts associated with the merger plan.

Auto bailout cost the US goverment $9.26B

Depending on your outlook, the US Treasury's bailout of General Motors, Chrysler (now FCA) and their financing divisions under the Troubled Asset Relief Program was either a complete boondoggle or a savvy move to secure the future of some major employers. Regardless of where you fall, the auto industry bailout has officially ended, and the numbers have been tallied. Of the $79.69 billion that the Feds invested to keep the automakers afloat, it recouped $70.43 billion – a net loss of $9.26 billion. The final nail in the coffin for the auto bailout came in December 2014 when the Feds sold its shares in Ally Financial, formerly GMAC. The deal turned out pretty good for the government too because the investment turned a 2.4 billion profit. The actual automakers have long been out of the Treasury's hands, though. The current FCA paid back its loans six years early in 2011, the Treasury sold of the last shares of GM in late 2013. According to The Detroit News, the government's books actually show an official loss on the auto bailouts of $16.56 billion. The difference is because the larger figure does not include the interest or dividends paid by the borrowers on the amount lent. While it's easy to see fault in any red ink on the Feds' massive investment, the number is less than some earlier estimates. At one time, deficits around $44 billion were thought possible, and another put things at a $20.3 billion loss. Outside of just the government losing money, the bailouts might have helped the overall economy. A study from the Center for Automotive Research last year estimated that the program saved 2.6 million jobs and about $284.4 billion in personal wealth. It also indicated that the Feds' reduction in income tax revenue alone from Chrysler and GM going under could have been around $100 billion for just 2009 and 2010, significantly more than any loss in the bailout.

Chrysler 200 replacement coming in January

Autoweek reports the next Chrysler 200 will bow early next year. CEO Sergio Marchionne has said the 2015 model will debut next January, and Chrysler plans to cut the 2014 200 model year short to make way for the model's successor. According to AW, internal documents reveal 2014 model production will start this July and run through early January, 2014. The memos don't specify whether its Dodge Avenger twin will also see a shortened model year (the latter was originally rumored for discontinuation, but a successor is apparently back on the table). Chrysler is investing some $1 billion to construct paint and body facilities at its Sterling Heights, Michigan plant for the next-generation 200.
From what we've heard so far, we can expect the 2015 200 to bring a new design language to the Chrysler brand that will eventually bleed into the automaker's other products. Early reports have also suggested the four door will boast a nine-speed automatic transmission and return up to 38 miles per gallon.
Chrysler executed a very successful facelift in 2011, turning the flailing Sebring into the newly minted 200. Buyers responded enthusiastically, with sales jumping 44 percent in 2012. That step up was enough to make the 200 the brand's best-selling car. The momentum hasn't slackened, either, with sales up 21 percent during the first two months of this year.