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Fiat To Pay $3.65 Billion For Remaining Chrysler Shares

Italian automaker Fiat SpA announced Wednesday that it reached an agreement to acquire the remaining shares of Chrysler for $3.65 billion in payments to a union-controlled trust fund. Fiat already owns 58.5 percent of Chrysler's shares, with the remaining 41.5 percent held by a United Auto Workers union trust fund that pays health care bills for retirees. Under the deal, Fiat will make an initial payment of $1.9 billion to the fund, plus an additional $1.75 billion upon closing the deal. Chrysler will also make additional payments totaling $700 million to the fund as part of an agreement with the UAW. The deal is expected to close on or before Jan. 20, according to a statement from Chrysler. Sergio Marchionne, CEO of both Fiat and Chrysler, has long sought to acquire the union's shares in order to combine the two companies. "The unified ownership structure will now allow us to fully execute our vision of creating a global automaker that is truly unique in terms of mix of experience, perspective and know-how, a solid and open organization," Marchionne said in a statement issued by Turin, Italy-based Fiat. The deal eliminates the need for an initial public offering of the union fund's stake, which analysts had previously valued at $5.6 billion. Fiat went to court last year seeking a judgment on the price, but the trial date was set for next September. Marchionne can't spend Chrysler's cash on Fiat's operations unless the companies merge. In recent months he made it clear that he preferred to settle the dispute without an IPO, but filed the paperwork for the offering in September at the trust's request. Chrysler's profits have helped prop up Fiat on the balance sheet as the Italian automaker struggles in a down European market. The Auburn Hills, Mich., automaker earned $464 million in the third quarter on U.S. sales of the Ram pickup and Jeep Grand Cherokee, its ninth-straight profitable quarter. The results boosted Fiat, which earned $260 million in the quarter. Without Chrysler's contribution, Fiat would have lost $340 million. UAW/Unions Chrysler Fiat

Google's new Android Autos OS unveiled, will be in cars this year [w/video]

Connected cars are coming en-masse. We know this much. How, though, remains something of an open question, especially as two of the world's largest tech companies are preparing to battle for control of your car's dashboard. On the one hand, we have Apple and its CarPlay system. And now, we know what Google has been working on with Auto Link.
Its new name is Android Auto, and yes, it's based off the Android architecture that is the primary challenger to Apple's iOS mobile operating system. Announced at Google's I/O conference today, Android Auto functions similarly to CarPlay - owners will need to plug their smartphones into their cars to access the full breadth of capability.
In Android Auto's case, that means a wealth of voice controls to limit distracted driving. Google's marquee apps will be available when the interface arrives in production models later this year, including Google Play Music, Google Maps and voice-activated texting and text playback. Meanwhile, developers will be able to begin designing custom apps for the new system via an upcoming software development kit.

Stellantis reports surprising 2020 results, is 'off to a flying start'

MILAN — Low global car inventories and cost cuts should boost Stellantis's profit margins this year, though a shortage of semiconductors and investments in electric vehicles could weigh on results, the newly-formed automaker said on Wednesday. The forecast came as Stellantis, created by the January merger of Peugeot-maker PSA and Fiat Chrysler (FCA), reported better-than-expected results for 2020 that sent its shares up around 3% in morning trading. "Stellantis gets off to a flying start and is fully focused on achieving the full promised synergies (from the merger)," Chief Executive Carlos Tavares said in a statement. Stellantis is the world's fourth largest carmaker, with 14 brands including Fiat, Peugeot, Opel, Jeep, Ram and Maserati. It said 2021 results should be helped by three new high-margin Jeep vehicles in North America and a strong pricing environment there. The U.S. market has driven profits for years at FCA and starts off as the strongest part of Stellantis. The group's guidance assumes no more significant lockdowns caused by the global COVID-19 pandemic, which shuttered auto plants around the world last spring. Stellantis should also get a lift as its starts to implement a plan aimed at delivering over 5 billion euros a year in savings, without closing any plants. Tavares has also pledged not to cut jobs. But a pandemic-related global shortage of semiconductors, used for everything from maximizing engine fuel economy to driver-assistance features, could hurt business. Auto industry executives have said the shortage should ease by the second half of 2021. Stellantis said its "electrification offensive" could also weigh on results this year. Automakers are racing to develop electric vehicles to meet tighter CO2 emissions targets in Europe and this week Volvo joined a growing number of carmakers aiming for a fully-electric line-up by 2030. Stellantis plans to have fully-electric or hybrid versions of all of its vehicles available in Europe by 2025, broadly in line with plans at top rivals such as Volkswagen and Renault-Nissan, although Stellantis has further to go to meet that goal. The carmaker is targeting an adjusted operating profit margin of 5.5%-7.5% this year. That compares with a 5.3% aggregated margin last year: 4.3% at FCA and 7.1% at PSA excluding a controlling stake in parts maker Faurecia, which is set to be spun-off from Stellantis shortly.