Wednesday, May 6, 2009

Defending Fiat: Deal with Italian company could be the cure for ...

FIAT CEO Sergio Marchionne (left) arrives with Ferrari president Luca Cordero di Montezemolo, (center) for a test drive of the Fiat 500, (red in background) by Italian President Giorgio Napolitano in Rome in 2007. By David Feldman

Lew Winfield's letter fulminating against the Fiat-Chrysler deal (May 4) deserves some response.

The reason nobody sees a Fiat today, as Mr. Winfield says, is because the company left the U.S. market in 1989. They withdrew from selling Fiats, that is. The company can hardly be said to produce "boring little econoboxes" as Mr. Winfield complains, unless you believe Ferrari and Maserati, Fiat-owned cars currently sold in the United States, are boring.

Fiat has long planned to return Alfa Romeo, another one of their not-so-boring brands, to the United States within the next few years. The Fiat-Chrysler combination will facilitate these plans once current Chrysler, Dodge and Jeep dealers can begin to offer Fiat-produced cars. Indeed, the proposed deal will likely save many of those American dealers from bankruptcy.

Because their cars were not produced to co-exist with Northeast United States winters and our wide use of road salt, Fiats did have serious rust problems. But they sold some fine automobiles here. I owned two of them, a 124 Sport Spider and a 124 Sport Coupe. Both combined supple and road-gripping handling, with small but powerful (and economical) engines, and comfortable passenger accommodations. They were especially fun to drive on Central New York's curving back roads. Many are still alive and running well in the hands of serious collectors.

A great mistake many Americans make is to connect the Fiat company of today with some poor products from decades ago. Over the past 40 years, Fiat vehicles have won 12 of the prestigious European Car of the Year awards --competing against Mercedes, Audi, Volkswagen, Saab, BMW, Volvo, Jaguar, etc. In fact, Fiat is a top-rank European auto producer and is the world's third largest manufacturer of heavy-duty construction vehicles after Caterpillar and Komatsu. Fiat cars are produced not only in Italy, but also in Brazil, Poland, Serbia, Spain and India, among other countries.

It would, indeed, be sad to lose Chrysler, whose origins go back to 1923, and which has produced many advanced and highly sophisticated cars over the years. If a deal combining Chrysler's U.S. manufacturing and dealer base with Fiat's products and higher degree of current technology for producing economical and environmentally friendly cars can save the company and bring it back to profitability, then that sounds like a good deal all around.

David Feldman lives in Syracuse.



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