SPIEGEL: Mr. Marchionne, shortly before you submitted your rescue plan for Opel in Berlin, you were spotted driving around in a Ferrari, at high speeds…
SPIEGEL: Your driving speed isn't the only reason many are concerned about Opel's independence.
Marchionne: Everyone nowadays is agonizing over who should join forces with Opel. The only thing that counts is the fact that we are in the worst recession since World War II while simultaneously experiencing a deep structural crisis in the automobile industry. We can discuss ways to solve the problem, but not whether it exists.
SPIEGEL: What does your solution look like?
Marchionne: It's quite simple. Fiat currently produces 2 million cars a year. That sounds like a lot, but it isn't enough to enable us to manufacture cars profitably in the future. GM's European subsidiaries produce 1.7 million cars a year, which also isn't enough. For this reason, my proposal is to merge the two carmakers and assemble a joint company which is competitive.
Marchionne: Fiat is not a sick company, but one of the few automakers making money in the current crisis. We are doing well. However the auto industry as a whole is not.
SPIEGEL: What worries you?
Marchionne: The industry built up tremendous excess capacity in the good years, and now, with shrinking demand, that capacity has to be adjusted. Otherwise it could become a threat, even for a healthy manufacturer like us. But it's a question of survival for Opel. Opel is losing money. Things cannot continue like this, partly because the company has a government-backed loan to repay. Opel needs a partner or it will go under.
SPIEGEL: The prevailing view at Opel is that the company would truly run into problems if it entered into an alliance with Fiat, and that jobs would be lost on a large scale. Can you reassure these people, especially those at Opel's plant in Eisenach in the eastern German state of Thuringia who are worried about losing their jobs?
Marchionne: The plant in Eisenach is not just a highly efficient automobile factory, but also a symbol of German unity. However, Eisenach could operate even more profitably by working together with our Fiat plant in the nearby Polish city of Gliwice, instead of with its sister plant in Zaragoza, Spain. No parts supplier or financial investor can offer Opel such advantages, but an industrial partner from within the same sector can. That's why a joint venture with us makes so much sense.
SPIEGEL: The more efficiently you utilize capacity at the plant in Eisenach, the less capacity you need elsewhere. Can you guarantee that you will also keep the plants in Rüsselsheim, Bochum and Kaiserlautern open?
Marchionne: No one can offer guarantees. That would be completely unprofessional. Based on our current plans, however, I can say that we will not have to close any Opel assembly plants in Germany.
SPIEGEL: So how do you propose to reduce the excess capacity you yourself have mentioned?
Marchionne: It's true that not everything can remain unchanged at GM's European subsidiaries. We're not just talking about German plants, but also factories in Spain, Britain and Belgium. We need a European solution.
SPIEGEL: What do the employees get out of it?
Marchionne: They will be part of Europe's second-largest automobile group, with substantial international growth and employment opportunities, especially as a result of the alliance with Chrysler. The engineering talent that is currently restricted to Opel could then be used to a much greater extent internationally.
SPIEGEL: How many jobs do you plan to cut?
Marchionne: I can't say. I have to take a look at the plants first.
SPIEGEL: Earlier Fiat plans mentioned a figure of 18,000 jobs.
Marchionne: We never mentioned that number. According to our initial estimate, far fewer than 10,000 jobs will be lost throughout Europe. The impact on Germany will be much lower.
SPIEGEL: The people at Opel want to see numbers. They want to know what sorts of hardships are ahead for them.
Marchionne: If there are to be hardships, they will be distributed fairly across Europe. We expect roughly a 20 percent reduction in capacity, which doesn't mean 20 percent fewer employees. As an automaker, I can offer solutions for an industrial problem. What I cannot do is create demand. I can't force anyone to buy a car, neither from Fiat nor from Opel. In other words, it makes no sense to produce cars that aren't needed. We at Fiat are very strict when it comes to this issue.
SPIEGEL: Berthold Huber, the head of the powerful German metalworkers' union IG Metall, says that the corporate cultures of Fiat and Opel are not a good fit.
Marchionne: Huber and I have one thing in common: We are both over 50. The nation state dominated political thought when we were growing up. Nowadays, everyone knows that the French, the Italians and the Germans have to work together if they hope to prevail on a global scale. This is exactly what we want to achieve with our plan. We want to create an EU-wide cooperative industrial venture, but without ignoring the various national cultures. On the contrary, we will preserve Opel as a fully independent national brand, with its own production, development and sales organization. At the same time, we would bring down costs enough to make Opel profitable once again.
SPIEGEL: There was a joint venture between Fiat and Opel once before. It was terminated four years ago, because it wasn't working.
Marchionne: I wasn't part of the company at the time. Based on everything I know about it, the main problem was that Fiat was the minority partner, while GM had the say. We couldn't develop transmissions before getting the OK from Detroit. The current state of GM shows just how far-sighted its management was. It was like being in bed with a bear. There was no room left for Fiat.
SPIEGEL: Many at Opel fear that Fiat is now the bear.
Marchionne: I can even understand that. But we leave more room in the bed, enough room, because we know what it takes for a mass producer to manufacture products today: It needs the most cost-effective and efficient production structure possible, while at the same time preserving brand independence. That's the trick, as Volkswagen exemplifies. VW, Audi, Seat, Skoda -- people think they are different brands, but in reality they're all Volkswagen.
SPIEGEL: You don't just want to merge with Opel. You also want to form an alliance with the ailing US carmaker Chrysler. After losing billions, Germany's Daimler Group recently ended its attempt to restructure Chrysler. Why should Fiat be better at it?
Marchionne: Daimler was not a mass producer. It is impossible to develop an identical suspension for a car in the Mercedes S class and an American small car. The worlds remained separate. We also own Ferrari. Ferrari has the best engine in the world. But if I tried to install this brilliant engine into a Fiat Punto, I'd be bankrupt in three months.
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