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Fiat To Pay $3.65 Billion For Remaining Chrysler Shares

Italian automaker Fiat SpA announced Wednesday that it reached an agreement to acquire the remaining shares of Chrysler for $3.65 billion in payments to a union-controlled trust fund. Fiat already owns 58.5 percent of Chrysler's shares, with the remaining 41.5 percent held by a United Auto Workers union trust fund that pays health care bills for retirees. Under the deal, Fiat will make an initial payment of $1.9 billion to the fund, plus an additional $1.75 billion upon closing the deal. Chrysler will also make additional payments totaling $700 million to the fund as part of an agreement with the UAW. The deal is expected to close on or before Jan. 20, according to a statement from Chrysler. Sergio Marchionne, CEO of both Fiat and Chrysler, has long sought to acquire the union's shares in order to combine the two companies. "The unified ownership structure will now allow us to fully execute our vision of creating a global automaker that is truly unique in terms of mix of experience, perspective and know-how, a solid and open organization," Marchionne said in a statement issued by Turin, Italy-based Fiat. The deal eliminates the need for an initial public offering of the union fund's stake, which analysts had previously valued at $5.6 billion. Fiat went to court last year seeking a judgment on the price, but the trial date was set for next September. Marchionne can't spend Chrysler's cash on Fiat's operations unless the companies merge. In recent months he made it clear that he preferred to settle the dispute without an IPO, but filed the paperwork for the offering in September at the trust's request. Chrysler's profits have helped prop up Fiat on the balance sheet as the Italian automaker struggles in a down European market. The Auburn Hills, Mich., automaker earned $464 million in the third quarter on U.S. sales of the Ram pickup and Jeep Grand Cherokee, its ninth-straight profitable quarter. The results boosted Fiat, which earned $260 million in the quarter. Without Chrysler's contribution, Fiat would have lost $340 million. UAW/Unions Chrysler Fiat

Feds investigating FCA sales fraud focusing on strange code word

The US government is currently investigating Fiat Chrysler Automobiles (FCA) over the possibility of sales fraud, and according to The Wall Street Journal, the investigation has revealed a strange phrase about a nonexistent "unnatural acts department." People knowledgeable about the term told The Wall Street Journal that this phrase was a "rallying cry." Basically, if it looked like the company, region, or dealer wasn't going to hit sales targets, this was a sign that some outside-the-box sales solutions were needed. People told the news outlet those solutions could include selling cars at a loss or having the dealer buy a fleet of customer test-drive cars. However, this could also be evidence of some less savory ways to boost sales. In addition to the investigation, the company is already facing at least one lawsuit from a dealer group that alleges it would bribe dealers to pad monthly sales figures. FCA had an incentive to maintain sales numbers as well, considering that it was claiming a long streak of increasing sales. Under scrutiny recently, the company changed its sales reporting practices and numbers for previous years. Under the old reporting methods, it was possible for dealers to sell cars, report the sales, and then cancel or "unwind" the sales later. This wouldn't count as a lost sale, but the car also couldn't be recorded as another sale later. As a result, an unscrupulous dealer could have hypothetically used it to "sell" a car one month and "unwind" it the next. If FCA knew about this, it's also possible the company could have pushed dealers to use the system for false sales, something the Feds theorize may be related to the "unnatural acts department" phrase. It's still entirely possible this "unnatural acts department" was just a corporate term for thinking of creative ways to meet sales goals. And selling cars at a loss is definitely unnatural for businesses that are trying to make money. Whatever the phrase truly meant to dealers, it certainly is bizarre. Related Video: News Source: The Wall Street JournalImage Credit: GIUSEPPE CACACE/AFP/Getty Images Government/Legal Chrysler Fiat FCA fiat chrysler automobiles fca us investigation

Classic Fiat 500 Abarth, a one-of-a-kind creation, goes on show in Milan

It’s a little car with a big name: the Fiat Abarth Classiche 500 Record Monza '58. Based on the much-revered Fiat 500, specifically the 1970 edition of the “Cinquecento,” this one-off model was assembled by the Stellantis Heritage team to celebrate the centenary of the Autodromo di Monza, the Formula 1 track located in a park just outside of Milan, It was Carlo Abarth who, in 1958, shattered six records at Monza in Abarth's first-ever tuned 500. This miniature classic, colored in a subtle shade of grey/green, was displayed earlier this month at the 12th Milano AutoClassica motor show, an event focusing on classic and sports cars. The two-cylinder engine has been tuned, with displacement increased to 595cc thanks to the Abarth Classiche 595 Tuning Kit. The company says this is inspired by the original kit offered by Abarth in the 1960s. There are several cosmetic applications as well to the car: cream-colored door trim and the single racing seat — another nod to the original — trimmed in a light cream upholstery. An elegant wooden steering wheel and Jaeger dials dominate the dashboard. Besides the display in Milan, Fiat also took to the stage last week at the Los Angeles Auto Show, announcing the CinquecentoÂ’s return to the United States in an updated package: powered by battery. The electric 500e hatchback, which will apparently stay true to the CinquecentoÂ’s essence of cute, will likely be powered by a 117-hp electric motor. The U.S. version will be similar to a setup already on sale in Europe, where it carries a driving range estimate of up to 199 miles per charge. Its expected in North America in early 2024. There will even be an electric Abarth version, but whether the U.S. will get that remains to be seen.