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UAW may be key to forced FCA merger with GM

Sergio Marchionne doesn't give up on a business deal easily. While outwardly not much has recently been said about FCA's attempted merger with General Motors, Marchionne might be hoping to garner a powerful, new ally that could help break things wide open. The United Auto Workers retiree health care trust is the single largest shareholder of GM with 8.7 percent of the stock, and having its support would certainly improve FCA's position in getting a deal done. "Whatever happens in terms of consolidation, it would never be done without the consent and support of the UAW," Marchionne said when FCA recently began contract talks with the UAW, The Detroit News reports. The boss is also allegedly on good terms with the union president Dennis Williams. Still, using the organization for a hostile takeover could be very difficult because of the way its votes are structured. Other activist investors might already be on board, though. Marchionne believes that consolidation in the industry is vital because automakers are investing to create the same technologies. A GM/FCA merger still has many roadblocks, though, including the fact that Marchionne's company is smaller than GM. From a regulatory perspective, the size of the merged company could raise serious anti-trust concerns among regulators, according to The Detroit News. There's also the concern for lost jobs from redundant work with the two combined businesses. Even if the UAW angle doesn't work out, there are contingency plans afoot for other merger targets. According to The Detroit News speaking to anonymous insiders, FCA bigwigs have a meeting in London on Thursday to take a close look at other options. In addition to GM, they are investigating possible deals with Volkswagen and the Renault-Nissan Alliance. In the past, PSA Peugeot Citroen and multiple Asian automakers have also been brought up as partners, and UBS has reportedly been providing financial advice on what to do.

Autoblog Minute: Marchionne seems prepared to lead FCA in takeover of GM

FCA CEO Sergio Marchionne wants industry consolidation but without any deal takers it seems as though he's ready to consider a hostile takeover. Autoblog's Chris McGraw reports on this edition of Autoblog Minute with commentary from Autoblog editor-in-chief Mike Austin. Show full video transcript text [00:00:00] It's no secret that FCA CEO Sergio Marchionne wants industry consolidation but without any deal takers it seems as though he's ready to consider a hostile takeover. I'm Chris McGraw and this is your Autoblog Minute. Marchionne is tired of waiting for the industry to get on board with his consolidation plan. In an interview with Automotive News Marchionne was quoted as saying, "it would be unconscionable not to force a partner." And when pushed further about the nature of any potential takeover plan the FCA chief had this to say: "Not hostile. There are varying degrees of hugs. I can hug you nicely, I can hug you tightly, I can hug you like a bear, I can really hug you. Everything starts with physical contact. Then it can degrade, but it starts with physical contact." Metaphor aside, Marchionne suggests his numbers for a GM-FCA merger are irrefutable, pointing to potential global earnings of a 30 billion dollars. Without a merger deal on the horizon we have to wonder if an FCA takeover of GM even possible. For more we go to Autoblog's Mike Austin: [Mike Austin Interview] Marchionne says GM won't take his phone calls, and while he admits a merger with GM would be a hard road to haul it's one he's still determined to travel. We'll continue to monitor the story as it develops. For Autoblog, I'm Chris McGraw. Autoblog Minute is a short-form video news series reporting on all things automotive. Each segment offers a quick and clear picture of what's happening in the automotive industry from the perspective of Autoblog's expert editorial staff, auto executives, and industry professionals. UAW/Unions Chrysler Fiat GM Autoblog Minute Videos Original Video

New Fiat Chrysler CEO picks management team to tackle industry in flux

MILAN/DETROIT — Fiat Chrysler's new boss unveiled his management team on Monday, seeking to revive the automaker in Europe, forge ahead in North America and keep the group in contention in the industry's race to develop self-driving and electric cars. Mike Manley took over in July after long-time chief Sergio Marchionne fell ill and later died after succumbing to complications from surgery. British-born Manley has since pledged to carry through a strategy Marchionne outlined in June to keep FCA "strong and independent." "The next five years will continue to be extremely challenging for our industry, with tougher regulations, intense competition and probably slower industry growth around the world," Manley said in a letter to employees on Monday. "Nevertheless, with a laser focus on execution and a continued flexibility that allows us to adjust as circumstances change ... we have a clear line of sight to achieving our five-year ambitions." Manley appointed Pietro Gorlier, thus far chief operating officer of FCA's components business, as FCA's next European chief to tackle a region where profitability is below that of peers, many workers are stuck in furloughs and various plants run at below capacity. The carmaker's previous European chief Alfredo Altavilla left after FCA appointed Manley as Marchionne's successor. As head of the components unit, Gorlier has also led Magneti Marelli, the parts unit that FCA may either spin off or sell. He will be succeeded at Magneti Marelli by the parts maker's lighting division head Ermanno Ferrari. Japan's Calsonic Kansei has been in talks with FCA about buying the unit, sources familiar with the matter have said, but no binding agreement has been reached and the deal could still fall apart. Choosing an Italian as head of Europe might soothe some fears in Italy that FCA could weaken its link to Fiat's roots. In his last strategy unveiled in June, Marchionne vowed to convert Italian plants to churn out Alfa Romeos, Jeeps and Maseratis instead of less profitable mass market vehicles to preserve jobs and boost margins. Europe will also become a big part of the company's electrification drive. FCA will copy in Europe what worked in the United States, where it retooled plants to build pricier SUVs and trucks in a move since emulated by bigger rivals Ford and GM. Manley also named new managers to succeed him at Jeep and RAM, the two brands which have been driving profits in recent years and remain at the core of growth plans.