Chrysler – Fiat Deal is Horrible for GM and Ford

Fiat's and Chrysler's new partnership is borderline good or, at a minimum, a non-event for Chrysler. It's great for Fiat, but horrible for General Motors (GM) and Ford (F).

Chrysler – Fiat Deal is Horrible for GM and Ford

Fiat’s and Chrysler’s new partnership is borderline good or, at a minimum, a non-event for Chrysler. It’s great for Fiat, but horrible for General Motors (GM) and Ford (F).

Chrysler gets access to Fiat’s technology and smaller cars. That’s good but Fiat doesn’t appear to be willing to throw a lot of cash into Chrysler’s direction. What’s great for Fiat is that it gets overnight access to Chrysler’s distribution. Fiat will be able to sell and service its Fiat and Alfa Romeo brands nationwide. This is also a positive to Chrysler dealers ( at least for the ones that are still around by the time this deal is consummated). But this is horrible news for GM and Ford. Horrible! Horrible! Horrible! The auto market in North America is already and will continue to shrink for a while as consumers drive an existing car for 6 or 7 years instead of 5. And that decision has gotten even easier in the last decade as overall car quality has improved. So now GM and Ford will need to split a shrinking market with a new competitor.

Please read the following important disclosure here.

Enjoyed this read?

Share it with someone who’d love it too!

New to investing?

Explore these valuable guides to get started.

Related Articles

What to Do When a Stock Drops 25%

What to Do When a Stock Drops 25%

Stock XYZ has declined 25%. What do you think? Is your thesis broken? What you observe in stock price volatility is mostly noise. A good chunk of buyers and sellers don’t know much about what they are trading other than the ticker.
Greg Abel Takes Over Berkshire Hathaway: My Thoughts After Omaha 2026

Greg Abel Takes Over Berkshire Hathaway: My Thoughts After Omaha 2026

Last year I came out of the BRK annual meeting thinking that Greg Abel was not the right person to run Berkshire Hathaway. Abel lacked Buffett's charisma, warmth, and humor. Greg Abel was not Buffett, and he definitely was not Munger. I was wrong.
What the Iran War Reveals About the Dollar, Gold, and the End of US Exceptionalism

What the Iran War Reveals About the Dollar, Gold, and the End of US Exceptionalism

The Iran war exposes a quiet rewriting of the rules that made the US exceptional. Why we own oil, why we hate owning gold, and why crypto still isn't for client accounts.

Q&A Series: On Firing Clients, Sizing Positions, and Ignoring Book Value

At IMA, we deal with prospective clients who have a short-term time horizon very differently. We do what I call "reverse marketing." I write articles, people read them, and when they get interested in our services, they download our brochure and reach out to us.

Leave a Comment