Fiat Will Name Chrysler's Board

If the alliance between the two manufacturers eventually takes shape, Fiat will not limit itself to the 35 percent stake in the American manufacturer, but will also get control of Chrysler's board and even its top management, Reuters reported. If up until now this was only in rumor stage, such moves have been confirmed by Chrysler CEO Bob Nardelli in an internal memo to workers.

"The board will have the responsibility to appoint a chairman. The board also will select a CEO with Fiat's concurrence," the CEO said in the memo. This in fact will mean that Nardelli's reign is over.

As for the ultimatum given by Fiat to Chrysler to reach an agreement with the UAW and CAW, Nardelli tried to emphasize the importance of the alliance for the Italians as well. As it the official response submitted yesterday, the CEO tried to dodge the bullet.

"Fiat strongly believes in the mutual benefits the alliance would create for both of our companies, our customers, employees and other constituents," Nardelli said. "We continue to review the status of all stakeholder discussions with Fiat, as the achievement of concessions is a condition of the alliance."

Not only the future of the Fiat-Chrysler alliance is in the hands of the unions, but the future of the American carmaker as a whole as well. If Fiat doesn't step in, Chrysler's position worsens. The next meeting between the company and the CAW is scheduled for Monday.

"The additional concessions we are seeking from the UAW are critical to receiving continued support of the administration, completing our Fiat alliance and achieving sustained viability," Nardelli added.