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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 nearly half a million vehicles with active head restraints

Chrysler has announced that it will recall roughly 490,000 vehicles around the globe due to a potential active head-restraint problem. The problem is being blamed on "potentially faulty microcontrollers" that may keep the vehicles' anti-whiplash active safety feature from working properly. Chrysler says it has no knowledge of any accidents or injuries related to the issue. Models covered under the recall include the 2011-2013 Chrysler Sebring, 200 (shown) and Dodge Avenger models, along with 2011-2013 Jeep Liberty and 2011-2012 Dodge Nitro SUVs.
Interestingly, the Pentastar notes that the faulty part came from an (unnamed) supplier who furnished the parts in the wake of Japan's 2011 earthquake and tsunami, natural disasters which decimated the world's supply of microcontrollers.
Chrysler says of those nearly half a million vehicles affected, around 442,000 of them reside in the US, with an additional 25,000 in Canada and 10,000 units in Mexico. A further 12,000 models were shipped beyond the NAFTA region. The Auburn Hills automaker will begin sending out recall notices shortly, and technicians will upgrade the system software or replace the microcontroller as necessary at no cost to owners.

Chrysler Recalling 700k Vehicles 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." To fix the problem, Chrysler will install a new detent ring in the vehicles. It will begin contacting owners soon, and obviously the repair will be free of charge. This isn't the first time this problem has cropped up in these models. Chrysler issued a recall for 248,437 vehicles in 2011 for certain 2010 model year examples. A few weeks ago, NHTSA also began investigating the 2008-2010 model years of the affected models for ignition switch problems. At this time, it's not clear whether that evaluation and this campaign are linked. Chrysler told Autoblog that it has no reports of injuries related to the problem. Scroll down to read the company's statement and the NHTSA recall report. Statement: Expansion of Wireless Ignition Node (WIN) safety recall July 1, 2014 , Auburn Hills, Mich. - Out of an abundance of caution, Chrysler Group is expanding a previous safety recall to install a more robust WIN module detent ring. A previous recall in 2010 included 196,000 Chrysler Town & Country, Dodge Grand Caravan and Dodge Journey vehicles built August 2, 2009 through June 17, 2010. The expansion includes an additional 695,957 vehicles manufactured January 29, 2007 through August 1, 2009.