Fiat plans to emerge world's second-largest automaker

08 May 2009

Italian automobile giant Fiat SpA is redrawing its business plans to create an automotive empire by taking over General Motors' Europe, South American and South African operations.

If the plan goes through, Fiat will become the world's second-largest carmaker after Japan's Toyota, as it already has sealed a deal with troubled US automaker Chrysler LLC.

According to reports, Fiat is planning to merge its car business with GM's German brand Opel, UK brand Vauxhall, and Sweden's Saab unit.

The company had submitted the plan, dubbed Project Phoenix, to the German governmentthis earlier this week. With these acquisitions, Fiat foresees annual savings of around euro1.4 billion from 2015 onwards.

Fiat chief executive Sergio Marchionne is expected to return to Europe today from the US to lobby for his plan.

There were earlier reports that Marchionne is to meet German economy minister Kar-Theodor zu Guttenberg and foreign minister Frank-Walter Steinmeier to present a concept for the take over of Opel. (See: Fiat mulls Opel takeover even as it inks Chrysler deal).