Fiat closes deal to take Chrysler's good assets

Italy’s Fiat is the new owner of the bulk of Chrysler’s assets, closing a deal today that saves the troubled US carmaker from liquidation and places a new company in the hands of Fiat’s chief executive officer.

The deal clears the way for a new, leaner Chrysler Group to emerge from bankruptcy protection minus billions in debt, 789 underperforming dealerships and burdensome labour costs that nearly sank it.

Fiat CEO Sergio Marchionne was immediately named CEO of the new company, which said in a statement that it would soon reopen Chrysler factories which were idled during the bankruptcy process, costing the carmaker $100m (€71m) per day.

The new company will focus on smaller vehicles.

“Work is already under way on developing new environmentally friendly, fuel-efficient, high-quality vehicles that we intend to become Chrysler’s hallmark going forward,” the new company said in a statement.

The Italian carmaker won’t put any money into the deal but will give Chrysler billions worth of small car and engine technology.