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Fiat and UAW back at negotiating table over Chrysler stake

We knew there'd be no Chrysler IPO before the end of this year, but Fiat is determined to get the best run going into 2014 and is back at the poker table with the UAW. The delay was said to be Chrysler's desire to clean up a tax issue with the IRS; turns out that also bought the carmaker time to try and close a deal for the UAW's 48.5-percent stake in the company before the IPO happens.
Whereas the price Chrysler was willing to pay was once more than $1 billion under the UAW's asking price, the gap has closed to just $800 million of late. A recent valuation of the company at $10 billion - a valuation the UAW has disputed - means Fiat would be looking to pay about $4.2 billion instead of the $5 billion that the UAW seeks. But the UAW needs to hold out for the highest amount it can get because its pension obligations through the Voluntary Employee Benefit Association (VEBA) are $3.1 billion greater than the VEBA's assets, which include the Chrysler stake.
There's a clause in the agreement that Fiat can buy the VEBA shares for $6 billion, but Fiat CEO Sergio Marchionne has said that the UAW "should buy a ticket for the lottery" if they even want $5 billion. The UAW, though, has more time to wait; it's Fiat that wants access to Chrysler's $11.9-billion war chest and that would like to avoid the risk of paying the full $6 billion for the UAW share if the float really takes off. With other valuations of Chrysler as high as $19 billion, a hot IPO could make that $6 billion look like a bargain.

Chrysler recalling 700k minivans and Dodge Journey for ignition switch woes

General Motors isn't the only automaker with ignition switch problems. Chrysler is fighting it too and is now announcing a recall of 695,957 examples worldwide of the Chrysler Town & Country and Dodge Grand Caravan minivans from the 2008-2010 model years, plus the 2009-2010 Dodge Journey.
According to a statement from Chrysler, the models have a bad wireless ignition node detent ring in the ignition switch, making it possible for drivers to appear to have the key in the "Run" position but for the spring not to fully engage. It can then slip back to the "Accessory" position and shut the car off. If this happens, the vehicle loses power steering, brake boost and the airbags.
There is some disparity about the number of vehicles affected under this recall. In its statement, Chrysler claims that it covers 525,206 vehicles in the US, 102,892 in Canada, 25,591 in Mexico and 42,268 elsewhere. However, the recall announcement posted by The National Highway Traffic Safety Administration lists an estimated 438,109 vehicles in the US. Chrysler spokesperson Nick Cappa told Autoblog via email that the reasoning for the different figures "will become clear at a later date."

Chrysler Group moves around execs in wake of recent departure

Chrysler is busy shuffling executives around in the wake of Ram head Fred Diaz's departure. The automaker has named Reid Bigland (pictured, right) as Diaz's successor in the role of president and CEO of Ram, though Bigland will continue his duties as the head of US sales and the president and CEO of Chrysler Canada. Bigland first came to Chrysler in 2006 from Freightliner Custom Chassis Corporation, so the guy knows a thing or two about trucks.
Meanwhile, Timothy Kuniskis will take over as president and CEO of Dodge. Previously, he served as the head of Fiat in North America and has been with Chrysler in one capacity or another since 1992. His old title now falls to Jason Stoicevich, who will also continue to work as the director of the automaker's California Business Center. Finally, Bruno Cattori will take over as the president and CEO of Chrysler Mexico.
Diaz left his position to take over as a divisional vice president of sales and marketing with Nissan. You can read the full press release on the Chrysler personnel changes below for more information.