Fiat set to become car supergroup

Italian car maker Fiat is in talks with General Motors (GM) to acquire European operations Vauxhall and Opel. The sixth biggest car manufacturer is already in the process of securing a share in the troubled operations of Chrysler, another one of the big Detroit three.With world domination firmly in its sights, Fiat would become the second biggest car operation in the world, behind GM if the buyout got the go-ahead.GM is under pressure to sell some of its car brands as part of the restructuring deal struck with the US Government. Saab is being restructured by the Swedish Government and is unlikely to be part of a deal with Fiat, while Hummer and Pontiac are set to be discontinued.Industry analysts have warned that the acquisition of Vauxhall and Opel could mean job losses in the UK and abroad.  Vauxhall currently employ around 5,000 people in the UK. Professor Garel Rhys from the Cardiff Business School agreed that British jobs could be lost if the deal went ahead."General Motors has indicated they have three plants too many and those three plants too many are actually in Germany, or run by the Germans", he told the�BBC."It could be that Fiat, knowing that the company is too big, would balk at taking on the Germans and might look for the softer option of closing a plant in the UK."German economy minister Mr zu Guttenberg said, after meeting Fiat Group chief executive Sergio Marchionne, that any deal would need short-term financing across Europe by the Italian carmaker of about €5-7bn.German union official Armin Schild, who sits on Opel's supervisory board, told the BBC: "I can't say if Mr Marchionne is able to save Opel, but I know that Opel and Fiat are direct competitors, producing the same types of cars for the same market, so the merger of both companies could offer little to each other and take away a lot.”

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