• Business Week, Detroit Free Press, Wednesday, January 21, 2009 11 AM

First, the bad news, as brought to us by Business Week's David Welch and Carol Matlack and echoed in a host of other stories around the net this morning: "Chrysler needs cash and competitive new models now -- neither of which Fiat can bring." To wit, Fiat made absolutely no commitment to help finance Chrysler, which is heavily in debt, and it remains to be seen how the two companies will fund development of jointly built vehicles.

In fact, it could cost Chrysler hundreds of millions per model, and take three or four years, just to retool its factories to make its own versions of Fiat's cars. But, as the story concedes, "there are some good fits." The Detroit Free Press' Mark Phelan takes it from there. "Allying with Fiat should provide Chrysler with the vehicles and powertrains it needs to offer a line of appealing and fuel-efficient small cars" like the award-winning 500 city car, the Grande Punto subcompact and Bravo compact, he writes. Fiat is also among the world's leaders in diesel technology, which Europeans overwhelmingly choose as a way to reduce emissions and fuel consumption.

"Fiat, in exchange, gets the dealer network and assembly capacity it wants to become a player in its return to the United States," Phelan writes. In addition, Fiat will benefit from Chrysler's expertise in minivans, rear-wheel-drive cars, pickups and Jeeps .

Read the whole story at Business Week, Detroit Free Press »