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Fiat board approves split

by Bill Cawthon on

Earlier today, the Board of Directors of Fiat S.P.A. approved a demerger of its two automotive businesses. Fiat’s heavy truck and equipment companies, including Iveco and CNH (Case New Holland) will be spun off into a new entity, Fiat Industrial S.p.A. Fiat S.p.A. will retain Fiat Group Automobiles (Fiat, Fiat Professional, Abarth, Alfa Romeo and Lancia), Maserati, Ferrari, Magneti Marelli, Teksid, Comau and FPT (Fiat Powertrain Technologies). Contrary to reports published elsewhere, the Fiat announcement did not say the company planned to incorporate Chrysler Group LLC into Fiat S.p.A. Fiat officially refers to its relationship with Chrysler as an alliance as it has operating control of the American automaker but does not have majority ownership.

Subject to regulatory approvals, the demerger is scheduled for January 1, 2011. Both companies will operate independently with their own management and board of directors and will be listed separately on the Milan stock exchange and current Fiat shareholders will receive a share in Fiat Industrial for every Fiat share they own at the time.

Bill Cawthon grew up in the auto industry in the 1950s. His Dad worked for Chrysler and Bill spent a number of Saturdays down on the plant floor at Dodge Main in Hamtramck. Bill is also the U.S. market correspondent for, a British auto industry publication, and a member of the Texas Auto Writers Association, which has named the Jeep Grand Cherokee the “SUV of Texas” several times and named the Ram 1500 as the “Truck of Texas” two years running.

Bill has owned five Plymouths (including the only 1962 “Texan”), one Dodge and one Chrysler and is still trying to figure out how to justify a Wrangler. He also has owned at least one of every 1:87 scale model of a Chrysler product. You can reach him directly at (206) 888-7324 or by using the form.

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