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by Matt Brogan

Italian car giant Fiat has commenced environmental and safety reviews of Chrysler factories from today as part of its plan to take a 35 per cent stake in the US manufacturer.

The Italian firm has enlisted the services of Environ Holdings Inc to carry out the studies in a bid to determine whether an investment would expose Fiat to any environmental or safety liabilities.

“Chrysler and Fiat are in the due diligence phase of our strategic-alliance discussions,” Chrysler spokesman Max Gates said.

The planned alliance is seen by Chrysler executives as the preferred route to survival. Chrysler, which is currently reliant of US Government loans to stay afloat, would gain access to Fiat engines, transmissions and small car platforms under the proposed deal to help it meet strict new US fuel economy standards.

The agreement will also allow Fiat to sell its range of vehicles through Chrysler’s US dealer network.

Chrysler’s US sales have dropped more than 40 per cent, year-to-year, in each of the last four months.




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