page_title: Automotive industry crisis of 2008–2010
section_title: Italy
hierarchical_section_title: Automotive industry crisis of 2008–2010 / Europe / Italy
caption_attribution_description: Fiat Grande Punto. Same as other version except the front license plate is cleaned up.
context_page_description: The automotive industry crisis of 2008–2010 was a part of the financial crisis of 2007–2008 and the resulting Great Recession. The crisis affected European and Asian automobile manufacturers, but it was primarily felt in the American automobile manufacturing industry. The downturn also affected Canada by virtue of the Automotive Products Trade Agreement.
  The automotive industry was weakened by a substantial increase in the prices of automotive fuels linked to the 2003–2008 energy crisis which discouraged purchases of sport utility vehicles and pickup trucks which have low fuel economy. The popularity and relatively high profit margins of these vehicles had encouraged the American "Big Three" automakers, General Motors, Ford, and Chrysler to make them their primary focus. With fewer fuel-efficient models to offer to consumers, sales began to slide. By 2008, the situation had turned critical as the financial crisis of 2007–2008 placed pressure on the prices of raw materials.
  Car companies from Asia, Europe, North America, and elsewhere have implemented creative marketing strategies to entice reluctant consumers as most experienced double-digit percentage declines in sales.
context_section_description: On December 16, 2008 Fiat in Italy announced that it will extend its temporary plant closures in Italy by a month; the Pomigliano d'Arco, the main plant for its Alfa Romeo cars will be shut for four weeks. However, on February 20, 2009, reacting to actions by the Italian government to stimulate the automotive sector, Fiat said its plant closures would be curtailed. The company also forecast that sales in Europe will drop by 14 percent in 2009.
  On January 20, 2009 the company announced that it had entered into an agreement, subject to regulatory approvals, to acquire 35% of Chrysler.  Fiat's 35% stake in Chrysler would not involve a conventional sale of shares, but would be achieved in return for allowing Chrysler to utilise some of Fiat's fuel efficient technologies (Chrysler's February submission to the U.S. government included a commitment to produce nine Fiat-derived vehicles over a four-year period starting in 2010, including four hybrid-electric and battery-electric models).  Chrysler would be accorded access to Fiat's sales outlets in Europe, while in reciprocation Fiat will also gain access to Chrysler's dealership network in the U.S., where it is predicted smaller models such as the Fiat Grande Punto may be successful.  In the past, Fiat has had trouble gaining a foothold in the American markets, whilst Chrysler has never held a strong market share in Europe since it sold its UK based Rootes Group and France based Simca to PSA Peugeot Citroen in the 1980s.
  On January 22, 2009, Fiat announced a 19% drop in revenues in the last three months of 2008. Italian Prime Minister Silvio Berlusconi said the government would meet to discuss the issue.
caption: Fiat and Chrysler hope smaller models like the Fiat Grande Punto could be successful in the U.S. market
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