Fiat to Get 35% Chrysler Stake for Magic Beans

We have the rumor that Fiat will be paid to take a stake in Chrysler:

Fiat, the stronger of the two, wouldn’t immediately put cash into Chrysler. Instead it would obtain its stake mainly in exchange for covering the cost of retooling a Chrysler plant to produce one or more Fiat models to be sold in the U.S., these people said. Fiat would also provide engine and transmission technology to help Chrysler introduce new, fuel-efficient small cars, they said.

Fiat is been trying to get back into the US market for years, and now they are getting a domestic factory for free.

If Fiat can get their Diesel model 500 or Panda into the US, both of which get something north of 50 mpg, they would have a real winner.

Update: the Freep confirms the deal.

H/T Calculated Risk.

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