Fiat eyes up GM Europe

Not content with securing a 20 per cent stake in Chrysler last week, Fiat is poised to make a bid for GM’s struggling European arm, too. The deal would bring brands such as Opel, Vauxhall and Saab under Fiat’s control, and boost the Italian firm’s yearly production from 2.2 million to around 5.5 million units. That’s enough to make Fiat one of the biggest manufacturers in the world – with revenue predicted to rocket to around 100 billion dollars a year – enough to compete with the likes of Toyota and VW.

Sergio Marchionne, Fiat’s CEO (pictured), has made it clear that this drastic move is a must in order to create sufficient economies of scale to secure Fiat’s long-term future. However, not everyone is convinced. There are fears that inevitable cutbacks would follow, and that the jobs of 5,000 Vauxhall workers in Britain could be under threat.

It has also been confirmed that there would be no overlap between the Chrysler and GM tie-ups. The Chrysler partnership is designed to smooth Fiat’s re-entry into the US market, whereas the GM merger is focused entirely on making Fiat one of Europe’s biggest players.