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Chrysler Australia unaffected: spokesperson


CHRYSLER Australia has moved quickly to separate itself from its troubled parents bankrputcy filing, saying its business as usual down under.

News of Chrysler's bunkruptcy and tie-up with Italy's Fiat this morning is the latest in a string of blows to the distressed US car industry.

Fiat will initially take a 20 per cent stake which would then rise to 35 per cent and could reach 51 per cent as early as 2013 if Chrysler is able to repay its government loans.

The ailing auto giant will get a total of $US10.4 billion ($A14.4 billion) in funding from both the United States and Canadian governments to support the move.

If all approvals are met, a new, leaner company will emerge from the train crash in 30-60 days, the company said.

In Australia, nothing will change.

Australian spokesman Jerry Stamoulis who represents Chrysler - including Dodge and Jeep - sees the move as "very, very positive''.

"Chrysler's international operations such as Chrysler Australia and New Zealand are not part of any bankruptcy filling,'' he said.

"Chrysler ANZ continues to market, sell and service Chrysler Jeep and Dodge vehicles and also honour the warranties of our vehicles.

"We continue to market, sell and service our vehicles in all our markets.''

It's rare to see a win-win come out of the US financial mire, least of all one from its car industry.

Without such a deal, Chrysler would crumple.

It will be Chrysler's third dalliance with other parties.

The previous relationship, also termed an alliance under the DaimlerChrysler umbrella, cost Daimler AG billions of dollars and ended in tears.

The deal between Chrysler and Fiat is:

- Chrysler is sold to a new company, NewCo.
- Chrysler uses US Treasury and Canadian Government funds ($US6.5 billion) to ``perform all its obligations'' regarding employees.
- NewCo is free of Chrysler's debts and liabilities. That means Fiat has no exposure to Chrysler's debts.
- NewCo offers Fiat 20 per cent of its capital. Fiat can increase this to 49 per cent by meeting certain conditions including creating a Chrysler-badged Fiat small car, building Fiat components in the US and when Chrysler has repaid its US Treasury debt.
- Chrysler products increase their presence in Europe; Fiat products - including Ferrari, Maserati, Case New Holland (agricultural equipment) and Iveco (trucks) - expand into the US and Canada. Along the way will be the sharing of engines, platforms, components and technology.

LINK:Chrysler Australia unaffected: spokesperson | PerthNow
 
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