Fiat to split car and industrial divisions
The plan will see the Iveco trucks, Case New Holland farming and construction equipment and its industrial and marine engines firms separated from its Fiat, Ferrari and Maserati car brands as well as its automotive components firms, with Fiat saying that the process should be completed in six months.
The demerged company will be named Fiat Industrial (FI) and wil be listed on the Milan stock exchange.
Commenting on the rationale behind the demerger, CEO Sergio Marchionne said: 'There is no longer any reason to keep together sectors that operate with such diverse financial and industrial logic.
He added: 'With this new structure, the two companies will have the freedom to pursue the best strategic choices, including strategic alliances. They will have complete freedom of movement and a well-defined operating profile, enabling them to fully demonstrate the value that might otherwise be partially suffocated.'
The announcement comes in the wake of this week's release of first-quarter figures for Fiat, which reported a net loss of €21 million following a net loss of €411 million a year ago, and Chrysler, which announced a net loss of $197 million (€147 million), following its bankruptcy last year.