A preliminary "teaser" image of the new Dodge Dart, which will debut in Detroit on January 9.
With the launch of the new Dodge Dart, making its debut at next week’s North American International Auto Show, Chrysler expects to grab a larger share of the growing compact car segment.
But the maker’s Italian partner Fiat will grab an immediate larger stake in the U.S. maker – boosting its holdings by 5% for adding a new model to the Chrysler line-up that can deliver at least 40 miles per gallon on the highway.
That was one of the stipulations set by the White House as part of the 2009 bailout of Chrysler. Fiat initially was granted a 20% stake and effectively put in charge of the U.S. maker’s turnaround. Since then, Fiat has steadily increased its holdings by meeting a series of additional requirements – most recently by paying off Chrysler’s remaining federal loans and then buying out the shares in the carmaker owned by the U.S. and Canadian governments.
With this move, Fiat now holds a 58.5% stake in Chrysler, Sergio Marchionne serving as CEO of both makers.
The Canadian-educated executive has been steadily increasing the ties between the two companies. Last year, he realigned management so Chrysler and Fiat now operate as one effectively global organization.
The remaining 41.5% stake in Chrysler is now held by the United Auto Workers Union’s VEBA, or Voluntary Employee Benefit Association, an entity created in 2007 to transfer much of Chrysler’s health and legacy costs off corporate books.
Marchionne has indicated he will likely seek to purchase some of those shares, as well, a Chrysler government filing last year indicating Fiat would like to eventually hold a 70% stake in the maker.
As for the new Dodge Dart, it brings back a nameplate wildly popular in the 1960s and ‘70s, though it hasn’t been offered in the U.S. market in three decades. The compact car is based off the Italian maker’s Alfa Romeo Giulietta and the modified Compact U.S. Wide architecture will be shared with a number of other Chrysler and Fiat products.
The new Dart will be offered with a variety of powertrains, most notably two versions of Fiat’s high-mileage MultiAir engines. One, a turbocharged, 1.4-liter inline-six, topped 40 mpg in testing by the Environmental Protection Agency, triggering the payoff of another 5% in Chrysler stock for Fiat.
“The acquisition of a further 5% of Chrysler is a fundamental step in completion of the integration between our two groups, ” Marchionne, said.