NEWS

Fiat Chrysler CEO consults Tesla, Apple over consolidation

Monday, May 11, 2015

Fiat Chrysler Chief Executive Sergio Marchionne said on Saturday that he had visited the heads of Tesla Motors Inc and Apple Inc during a recent trip to California.

Marchionne, speaking on the sidelines of the opening of a Maserati dealership near Toronto, said he had met with Apple Chief Executive Tim Cook and Tesla CEO and founder Elon Musk, among others, on the trip, during which he also rode in Google Inc's self-driving car.

"I'm incredibly impressed with what that kid has done," he said, referring to Musk. With regard to Apple's Cook, he said: "He's interested in Apple's intervention in the car, that's his role." Marchionne was not more specific about Apple.

Sources have said Apple has been developing its own electric self-driving car. The company has been open about wanting to integrate its core iOS software into autos with a system called CarPlay, which allows drivers to access information on their iPhones without taking their hands off the streering wheel.

The Fiat chief declined to elaborate or describe the meetings in any more detail. Various automakers have been eyeing potential collaboration with Apple and Google even as they view their efforts to develop electric and self-driving cars as a potential competitive threat.

It is less typical for major automakers' CEOs to meet with their counterpart at Tesla, which has not collaborated much with established manufacturers.
Turning to Fiat's planned initial public offering of 10 percent of sports car maker Ferrari, Marchionne said it was on track to happen in the third quarter.

He also pledged that Fiat Chrysler would make a stronger entry in the realm of luxury sport utility vehicles. "When I see a Range Rover on the street, my blood boils, because we should be able to do a thing like that, and we will," he said.

Sergio Marchionne said he hasn't given up on his quest to push the auto industry to increase its profitability, even though carmakers are enjoying some of their best sales ever.

Last week, the Fiat Chrysler Automobiles NV chief executive officer argued for large automakers to combine and share costs. Analysts largely agreed with him, though his argument has been rejected so far by his fellow CEOs.

"We need to find a way to get this done," he told reporters Saturday at the opening of an Alfa Romeo and Maserati dealership in Oakville, Ontario, a Toronto suburb. "If they think these comments are going to deter me from the objectives, I've got news for you: It just reinforced my conviction it needs to happen. I haven't had a guy tell me it's not true. Not one."

Marchionne, 62, said last week he wants consolidation that helps cover development costs for expensive components like engines and advanced technologies, as well as more mundane things like parts. If companies can merge and defray those costs over more sales volume, they can boost returns, Marchionne said.
The executive has been pushing the auto industry to consolidate as a way to increase profitability. Other automakers have yet to take the cue, with booming sales in the U.S. and Europe easing pressure to restructure.

 

auto.economictimes.indiatimes.com

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