Fiat Talking To Banks About Buying The Rest Of Chrysler

The turnaround at Chrysler from almost-liquidated to reaping in one profitable quarter after another is arguably one of the strongest signs that America’s economy is recovering. But let’s be honest; if Fiat had not stepped in, there’s a good chance Chrysler, as a company, may have closed its doors in 2009.

Instead, Chrysler has propped up Fiat’s own faltering balance sheets, which has the Italian automaker looking to buy the remaining stake in Chrysler it doesn’t yet own. Bloomberg reports that Fiat is in talks with banks about raising the necessary capital to complete a merger between Chrysler and Fiat.

Without getting too in-depth into the financial situation, Chrysler’s strong showing in the past couple of years has helped Fiat weather the massive losses it is suffering in Europe. Car sales in the Old World are in the crapper, and Fiat’s European operations probably won’t turn a profit until 2015, at the earliest. Without Chrysler, Fiat might need a bailout of its own.

In order to complete the merger, Fiat needs to get its hands on the 41.5% of Chrysler owned by the UAW trust fund. Fiat owns 58.5% of Chrysler currently, and if they own the rest of it a complete merger of Italian and American automotive engineering can take place.

But with Fiat set to introduce Alfa Romeo and more Fiat models in America, could Chrysler become an unwitting pawn in an Italian powerplay? Or will the American automaker maintain its identity despite this merger of American and European interests.