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Fiat-Chrysler CEO Sergio Marchionne has accused the VW Group of taking advantage of its overseas profits to undercut its rivals in the European market and, thus, create a “bloodbath” for their sales.
Despite VW calling for his resignation as president of the ACEA, the European Auto Manufacturers’ Association, they subsequently made up, with VW CEO Martin Winterkorn and Marchionne settling the issue during the Paris Auto Show.
Marchionne was also re-elected today for a second two-year term as ACEA president. Apparently, though, despite being “good friends” with Winterkorn, he hasn’t buried the hatchet and wants to get back at VW.
Europe is a no-no, as VW is dominant, with a 25 percent share and Fiat is simply fighting to stay alive. In the United States, though, it's a whole different game: the Chrysler Group has an 11.4 percent market share and VW, despite its four brands (VW, Audi, Bentley and Lamborghini) posting a 31 percent increase in sales, commands only 4 percent of the market.
Marchionne has decided to take advantage of this role reversal in the States by offering US$1,000 rebates to current U.S. VW owners if they buy a Fiat or Chrysler vehicle – and the best part is that they don’t even have to sell their VW.
So, the Fiat-Chrysler CEO has found a way to give VW a taste of its own medicine. We’ll have to wait and see a) if it works and b) how his German frenemies will react.
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