Report: Volkswagen in talks over Fiat takeover


Volkswagen (OTCQX:VLKAY) is looking into buying Italian rival Fiat (OTCPK:FIATY), German Manager Magazin reported on its website this morning.

The publication stated that Fiat's owners want to shift their focus to the Ferrari brand and exit the traditional automotive business.

VW is hoping to gain access to Chrysler's U.S. distribution network by the Fiat-Chrysler purchase, which would be a contributing factor in turning around auto sales.

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Comments (10)
  • permanent
    , contributor
    Comments (493) | Send Message
     
    Not going to happen!
    17 Jul 2014, 07:53 AM Reply Like
  • cpryds
    , contributor
    Comments (92) | Send Message
     
    Why does so many people in SA say something without even mentioning at least a single reason. Just a tiny little reason for their statements :S Very frustrating to look at all these comments that does not make any sense at all. Might just write that the moon is yellow. Why do write something you cannot argue for??... Sorry for my frustration :)!!
    17 Jul 2014, 08:46 AM Reply Like
  • permanent
    , contributor
    Comments (493) | Send Message
     
    Here are some reasons:
    VW is a strong global brand with subsidiaries like Audi, Skoda, Porsche, Ducati, Seat, etc. The week spot is clearly in the US ex luxury that is the only area where any Merger talks would make sense because of Chrysler.
    The FIAT brand is weak and not really present in any of the BRIC nations except Brazil.
    17 Jul 2014, 09:29 AM Reply Like
  • David at Imperial Beach
    , contributor
    Comments (4381) | Send Message
     
    Seems like a pretty brain-dead idea to me too, but I don't think we can so easily dismiss it as "Not going to happen!" VW does seem to like to buy up European rivals whether it makes any sense or not. In particular, they like to own trophy brands like Audi, Bentley, Bugatti, Lamborghini and Porsche. Fiat has shares in Ferrari, and owns Alfa Romeo and Maserati outright. That would be a fine collection to add to the VW stable.
    17 Jul 2014, 10:00 AM Reply Like
  • loftyhgoal
    , contributor
    Comments (82) | Send Message
     
    Permanent, Your argument against seems to say the same thing as the article above for it happening -- Chrysler USA. The troubling thing if you're long VW is that they will likely pay a premium and not be able to realize any cost reductions in Europe through synergy. I don't think VW needs the distribution network in the US -- they need a product, namely an affordable line of SUVs. The Phaeton at $65k is a mistake under the VW brand - a first year marketing student could have told them that. I think they'll reposition soon. And when the next gas spike hits they are well positioned with a line of affordable fuel efficient vehicles.
    17 Jul 2014, 10:29 AM Reply Like
  • 11146471
    , contributor
    Comments (1379) | Send Message
     
    One word: W.O.W. !
    17 Jul 2014, 11:06 AM Reply Like
  • Jbgoose
    , contributor
    Comments (3244) | Send Message
     
    (OTCPK:FIATY) is one of our larger accumulating positions. Accumulating; not opportunistically trading headlines and other such actions over the past 6-9 months. It had been in such a long position, being accumulated opportunistically on dips - now this news.

     

    This news is disruptive as to why our (OTCPK:FIATY) position was initiated. Thus awaiting truth and reasoning why a deal benefits any party. (VW) in my opinion does not operate well in the United States. Failures abound. No product or story behind them that stands out at the moment. I do not trust (VW) as the owner of the Jeep brand. Such a deal will not be good for Chrysler/Jeep Branding. They need to remain focused expanding in China, capitalize on US growth tailwinds and increase margins in the most elite divisions, why would they sell? Such a merger would hamper much progress made and at first look is not beneficial in the longer run to FIATY. IMO.

     

    The diesel technologies are the only reason I see VW going after FIATY as complimentary. VW wants the products, and perhaps VW is in worse shape than some think. The newest Chrysler/Jeep diesel engines are considered by many as the best new diesel technologies introduced to work trucks in decades. Family SUV's via Jeep, 7/800 miles a tank in a tough work truck or family SUV; a 'green' story built in, cleaner burning and more powerful than all others. Expanding into China. Quality image being restored in the US. VW will have to offer a huge premium if this is serious news.

     

    Well, my opinion thus far. JBG
    17 Jul 2014, 11:50 AM Reply Like
  • geekinasuit
    , contributor
    Comments (3129) | Send Message
     
    Fiat Chrysler denies report of merger talks with VW
    http://reut.rs/1qig9AH
    17 Jul 2014, 12:04 PM Reply Like
  • mobyss
    , contributor
    Comments (2634) | Send Message
     
    Whether true or not, this is a further indication that the number of global auto brands will need to shrink, and consolidation under larger corporate umbrellas will continue.

     

    "IF" VW buys Fiat, then they'll have Dodge, Chrysler, Ram, Jeep, Fiat, Ferrari, Maserati, Alpha Romeo, VW, Audi, Porsche, Lamborghini, Bentley and Bugatti brands on sale in the US!

     

    Clearly many of these are "halo brands", and the company as a whole could benefit from some platform and engine sharing, but in general there would be massive brand overlap. Both Dodge and Chrysler? The "Chrysler" name has as much value as "Mercury" or "Pontiac" now. Dump it.

     

    Maybe a streamlined company with four divisions (and sales % targets): Dodge/Fiat (20%), Jeep/Ram (45%), VW/Audi/Porsche (35%), and Alpha/Maserati/Ferrari... (<1%).
    17 Jul 2014, 03:10 PM Reply Like
  • Nick Cox
    , contributor
    Comments (1441) | Send Message
     
    I doubt this will happen:Marchionne has done a great job of sorting out Fiat but it's a long job and it is only half-done.I am sure he would not want to walk away now.
    However,it might be up to the Agnelli family and if they wanted out,then out they would go,whether it made commercial sense or not.
    It's hard to see it makes sense for VW,especially if the rumour is true that the Italians would keep hold of the up-market brands such as Ferrari and Maserati.
    Should mean continuing up-side for the Fiat share price though :-)
    18 Jul 2014, 12:48 AM Reply Like
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