LaSorda: Fiat Was the Only Option

Who is still living under the impression that the main focus of the Fiat-Chrysler alliance was the introduction of new technologies in the US should stand corrected. In the beginning, the main reason for Chrysler to go Fiat's way was the lack of any other option.

Tom LaSorda, Chrysler's former president and vice chairman told Reuters that Fiat was the only one who could save the company, as no other investor was willing to pay "a nickel' for the American manufacturer.

Of course, Fiat itself won't put up any money either. But given the fact that Chrysler had to choose between an alliance with Fiat and a product alliance with either Nissan or rival GM, the Italian connection made more economical sense, LaSorda said in a court hearing.

The former chairman says that he never considered a break up of Chrysler as a solution, even if such a scenario was on the table last year. The break-up would have brought Chrysler in between $9 billion and $25 billion, but LaSorda saiy he didn't support the plan because the company would have not survived.

LaSorda was questioned in court by a lawyer representing Indiana's pension funds, which opposes the sale of Chrysler's assets. The pension funds claim that a union-aligned trust fund is being treated more favorably in court than the secured lenders are. When asked about the steps the manufacturer and its management took so that union workers were given priority over the secured lenders, LaSorda only said "I had to look at all stakeholders."

The sale of Chrysler's assets is still on the table, as the court has not yet decided whether to allow it to proceed or not. The assets will be sold, if approved, to the new Chrysler Group, owned by Fiat, the union and the governments of the US and Canada.