Fiat, Chrysler deal is final. Who really runs the company now?
Fiat will own 20% of Chrysler Group, LLC to start. Could increase to 35%.
What shocks me is that the board will have four 'government representatives' on it, with the government only owning 8% of the company. The UAW owns 55% and only gets one representative. Fiat will get 3 representatives for their 20%. Those numbers seem out of whack.
Chrysler, Fiat ink deal - Jun. 10, 2009
I dunno, I see that as both smart and "prudent" by your US government.
A company's Board of Directors is the body that appoints the CEO of the company, and therefore determines the direction the company will go in. Having a strong presence on the new Chrysler's Board of Directors will help ensure that your government will be fully appraised of, and have a say in, the management of the new company.
That's important because the big three have been ignoring the 800 pound gorilla in the room too long now; that being the fact that the only way to break America's dependance on Saudi oil is to develop alternatives to the gasoline engine. Right now there is the technology to build a 300 mile per overnight charge electric car, but the major car companies really don't want to.
There is an excellent documentary called "Who Killed the Electric Car" that was aired on PBS that highlighted the EV1 electric car that GM built for the California market. The people that had those cars loved them, but GM never actually SOLD the EV1, it simply leased them on a year-to-year basis, much like renting an apartment. When California dropped it's requirement that a certain percentage of each manufacturer's cars be emission free, GM terminated the leases on all of their EV1's, collected those cars and crushed them. This was despite the fact that the people driving them were more than willing to purchase those cars from GM.
That "Who Killed the Electric Car" documentary cites the automotive maintenance infrastructure as one of the reasons for killing the EV1. Gasoline powered cars require an infrastructure to maintain; they require gas stations, service stations and parts manufacturers and distributors. Electric vehicles are considerably simpler and more reliable, and could very well eliminate this sector of the economy. So, instead of developing an electric car, GM is now trying to develop hydrogen fuel cell technology. This is despite the fact that they can build an emission free 300 mile-per-overnight charge electric car today, but a hydrogen fuel cell car will still cost over a million dollars with existing technology.
What's really needed is for major car makers to build cars that people want and the environment needs, not cars that will make their dealerships lots of money and keep America dependant on foreign oil.
Having a strong presence in Chrysler's Board of Director's meetings is a step in that direction.
Did you know that only 10 percent of the energy contained in each gallon of gasoline is actually converted into mechanical energy (work) in a gasoline engine? Most of the rest of the energy escapes as heat from the radiator and tail pipe. It's that low energy efficiency of internal combustion engines that makes burning coal to produce electricity to recharge the batteries in electric cars better for the environment than continuing on with the status quo. And, electricity can be produced from wind farms, water falls, solar panels and geothermal wells, wheras gasoline can't.
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