MONTREAL — Fiat SpA chief executive Sergio Marchionne says the Italian automaker plans to make use of Chrysler's plants in southern Ontario after the Italian company buys a stake in the ailing U.S. car manufacturer.
Marchionne said Fiat officials have toured Chrysler's Canadian assembly lines, concluding that they are efficient operations that churn out high-quality products.
"We have a large commitment to fully utilize these assets and the opportunity is going to be visible relatively quickly about what can be done here," he told reporters Friday after giving a speech in Montreal.
Fiat is on the verge of taking control of a 20 per cent share in Chrysler, pending the completion of bankruptcy court procedures in New York.
The Italian car giant, which owns Ferrari and Maserati, has been plotting a return to North America, where it last sold cars two decades ago.
It would gain access to Chrysler's dealer network, while the U.S. company would expand into Fiat's international markets.
Marchionne said he hopes Fiat can work with the Canadian Auto Workers union, a relationship that he acknowledges got off to a bumpy start. The CAW, however, managed a cost-cutting deal that helps save Chrysler Canada on labour costs at its plants.
The Windsor, Ont.-based automaker, with more than 9,000 employees, operates vehicle assembly plants in the southwestern Ontario border city of Windsor as well as Brampton, just northwest of Toronto, and a parts factory in Toronto.
"I think that if we start working together with the Canadian Auto Workers, I think these plants have got a great future," he said.
Fiat has also been in the bidding for GM's German unit Opel, but absented itself from talks this saying it faced "unreasonable" funding demands. Marchionne stressed that Fiat was not withdrawing its bid, but sources said Friday that the German government and Canadian auto parts maker Magna International (TSX:MG.A) have agreed on the framework of a deal for Magna to take a majority stake in Opel.
Marchionne, who took over as Fiat's CEO in 2004, said the company has "rebuilt the business from its ashes" under his guidance in the last five years.
Fiat, which employs 200,000 people in 190 countries, is well-positioned to be Chrysler's major operating partner, he added.
"Fiat has proved that it can manage a downturn and manage it well," he said.
The dual Canadian-Italian citizen said that while Fiat cannot substitute Chrysler's judgment on the North American market, it can offer technical expertise on how to produce smaller, more efficient cars.
"We showed up at the right time, with the right technology, the right engines and the right transmissions to help Chrysler complete its product range," he said.
"And we're going to benefit from what they do at the upper end of the spectrum."
The company has been developing a new fuel-efficient, cleaner-burning engine it hopes to put into its new vehicles.
"North American needs to get there," Marchionne said of greener cars.
"You just cannot afford to go around with 5.7-litre V8s - you don't need them."
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