Fiat Chrysler eyeing up Chinese takeaway

Fiat Chrysler Automobiles (FCA) has reportedly received an offer from a Chinese car-maker to buy the Italian-American automotive giant.

The offer, said to have been made by a "well-known" car-maker, is claimed to be worth a small premium over FCA's current market value, says Automotive News.

According to the US newswire, the deal to buy the Fiat Chrysler empire, which includes the highly profitable Jeep and RAM brands, was rejected by FCA bosses for not being attractive enough.

In what's labelled as a billion-dollar bidding war, sources speaking to Automotive News say that other Chinese car-makers are now also meeting with FCA execs to express their interest over a potential purchase.

Among the car-makers apparently interested is Great Wall Motor, senior execs from which were reportedly spotted at FCA's HQ in Auburn Hills, Michigan.

FCA has been described as the "perfect target" for Chinese car-makers desperate to expand into other foreign territories like the North American market and FCA boss, Sergio Marchionne, has for years invited and enticed a merger to help slash R&D budgets and boost economies of scale when developing new models.

Wild speculation has listed both Dongfeng and even Volvo's owner Geely as interested parties, among others, but neither FCA nor any of the other Chinese companies have confirmed their involvement in talks for a potential purchase.

According to a source speaking to Automotive News, the deal could be a shrewd one for Marchionne as it reportedly excludes Alfa Romeo, Maserati and Ferrari.

Those prized brands will remain in hands of Exor, the holding company still owned by the Agnelli family, the Italian relatives of Giovanni Agnelli who foundered Fiat.

As well as access to new markets like the US, Europe and Latin America, FCA owns an incredible 162 manufacturing bases, 87 R&D centres and 2600 dealers in the US alone.

Since 2015, Marchionne has tried to merge FCA with both General Motors and Volkswagen but failed at every opportunity.

To help make FCA more desirable to foreign investors Marchionne has killed off slow-selling models like the Dodge Dart and Chrysler 200 sedan in the US and slashed development budgets of other models to boost profit.

This included switching Jeep and RAM vehicles from a monocoque platform back to a less sophisticated, cheaper ladder-frame chassis.

Jeep will soon rapidly ramp up the number of models it offers to include a Wrangler ute and a large luxurious model to compete with Land Rover.

The effect of Marchionne's cost-cutting was to refocus production on high-profit vehicles like SUVs, people-movers and pick-ups.

Speaking to Automotive News last month, Marchionne admitted his strategy: "In order to be fair to our shareholders, we need to make sure that we deliver as much value out of this venture as we can," he said.

Despite being widely ridiculed by analysts back in 2014 when he laid out his plans, Marchionne is now claimed to be 'on track' to grow global sales from 4.4 million units per year in 2014 to almost seven million by 2018.