Chrysler-Fiat Alliance Gets the Green Light From US FTC

Although some people said that a potential alliance between Chrysler and Fiat would result in one of the biggest automakers in the US that could rule the roost in the country, the US Federal Trade Commission today approved the deal between the two manufacturers. According to a report by Reuters, the FTC said the strategic alliance poses absolutely no risk to competition in the US so there's no way we could talk about antitrust issues.

“The proposed transaction raises no competitive issues,” Norman Armstrong, acting deputy director of the FTC’s Bureau of Competition, was quoted as saying by Bloomberg. “We are working closely with other jurisdictions,” he said, pointing to international antitrust authorities.

Fiat and Chrysler announced in January that they have agreed to form a strategic alliance in the United States that would give Fiat an up to 35 percent stake in the American automaker. Furthermore, Chrysler would be able to benefit from Fiat's fuel efficient models and small car platform that would help it revamp the production lineup and get through the recession.

After further negotiations and following Chrysler's filing for Chapter 11, it has been said that Fiat might even get a 51 percent stake in the American automaker once it exists bankruptcy protection.

But getting back to the antitrust issue, none of the two sides ever talked about such a risk. Both Chrysler and Fiat emphasized the importance of such an agreement and underlined that the American company would be the first benefiting from the alliance. Here's what Bob Nardelli, Chairman and CEO of Chrysler LLC, had to say in January after announcing the partnership:

"A Chrysler/Fiat partnership is a great fit as it creates the potential for a powerful, new global competitor, offering Chrysler a number of strategic benefits, including access to products that compliment our current portfolio; a distribution network outside North America; and cost savings in design, engineering, manufacturing, purchasing and sales and marketing.

This transaction will enable Chrysler to offer a broader competitive line-up of vehicles for our dealers and customers that meet emissions and fuel efficiency standards, while adhering to conditions of the Government Loan. The partnership would also provide a return on investment for the American taxpayer by securing the long-term viability of Chrysler brands in the marketplace, sustaining future product and technology development for our country and building renewed consumer confidence, while preserving American jobs."
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About the author: Bogdan Popa
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Bogdan keeps an eye on how technology is taking over the car world. His long-term goals are buying an 18-wheeler because he needs more space for his kid’s toys, and convincing Google and Apple that Android Auto and CarPlay deserve at least as much attention as their phones.
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