Could Fiat Chrysler Sell Off Jeep and Ram?

Could Fiat Chrysler sell off Jeep and Ram? It seems as if that’s being seriously considered.

Could Fiat Chrysler sell off Jeep and Ram? Seatco has the best convertible top repair and installation service in the whole DMV Region

Jeep’s Mighty FC Concept Vehicle

There was an interesting moment during a conference call between FCA (Fiat Chrysler) and stock analysts earlier this week. Sergio Marchionne, the CEO of the company, was asked by an analyst if it’s possible that Jeep or Ram, or both, might be sold off by the company. Marchionne’s answer was simply, “Yes.”

Whoa.

It’s been looked at before, just as sort of a “what if “exercise, because it’s really not a bad idea, in terms of extracting the maximum value out of the collection of pieces that is now FCA. Jeep, by itself, is worth $22 billion. All of FCA together is only worth $17 billion, because you get the car business with it, which brings a lot of losses and liabilities to the table. Jeep has no liabilities, is growing rapidly and is incredibly profitable.

Could Fiat Chrysler sell off Jeep and Ram? Seatco has the best convertible top repair and installation service in the whole DMV Region.And, by the way, the same number-crunching was done for the Ram division, which produces the popular trucks. It’s worth $11.2 billion, according to market analysts.

If you’re running Chrysler, and you can make $17 billion into $33.2 billion, by subtraction, that’s got to look pretty appealing. Of course, then, if Jeep and Ram go away, what the heck do you do with what you have left? Basically, it’s not worth anything. A couple of the low-volume car models make money, like the hot rod cars, but we’re talking very low unit sales. It’s not enough for the company to be anything more than a specialty car company.

But the large, established Chrysler dealer network, along with those car models, is worth something to the right buyer. The right buyer could be PSA (Peugeot-Citroen), the French automaker who just acquired Opel, and has been wanting to get back into the North American market for years.

Or, hard to swallow as it may be, that dealer network could also be very valuable to a number of Chinese manufacturers that would like to sell in the American market.

And the wildest of wild-card buyers would be a company that makes electric cars, like Apple or Tesla or even a couple of the newer players.

But, back to “whoa”. This all makes financial sense, but it will obliterate Chrysler as we now know it. But, boy, the numbers are very compelling. Maybe the question shouldn’t be, “Could Fiat Chrysler sell off Jeep and Ram?”, but rather, “When Could Fiat Chrysler sell off Jeep and Ram?”. Soon? As in, next month? Next year.

“Whoa” is right, my good reader.

And, that’s before we even get to the wild-eyed speculation about who would buy Jeep and/or Ram. A German company? GM or Ford? They don’t need Ram, but they’d love to have Jeep. Some of the Japanese manufacturers would like to have Jeep. Same for the Koreans. Nissan might want Ram. Maybe the Koreans, too. And, of course, there are the Chinese manufacturers, eager to get into the American market, and they’re just flush with money. And remember when no one thought the Indians would buy Land Rover and Jaguar? They did, though, and they’ve done well with those companies.

And it might not even be an existing manufacturer. It could be a brand new company, formed just for the purpose of buying one of these brands and it’s manufacturing facilities, so as to enter the market as a stand-alone.

If the sales happen, it’s going to be weird for awhile. The regular order of things will be upended. But, that’s happened before – Pontiac going away, AMC sold to Chrysler, Studebaker going out of business, manufacturers pulling out of the U.S. market, etc. Stuff happens in the auto business.

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