Italy marks 'historic moment'

By Joe Lynam
BBC business reporter

Fiat is widely regarded in Italy as more than just a local success story.

Some Italians are looking forward to owning a piece of an American icon

It is perceived as one of the very symbols of Italian industrial pride and its new partnership with ailing US carmaker Chrysler has been warmly welcomed by the media in Italy.

The Italian press has been mostly uncritical of the deal preferring to focus on the fact that one of its companies could soon be controlling an American icon like Chrysler.

Most papers quote Fiat's chief executive Sergio Marchionne, describing the deal as a "historic moment for Fiat and the entire Italian industry".

The strongly pro-Berlusconi Il Giornale quoted the prime minister's "great satisfaction with an agreement that is further evidence of the strong economic and commercial ties between Italy and the USA".

The paper added that the deal confirmed that Fiat's industrial technology and innovation had made Italy proud.

La Stampa newspaper, which is owned by the Agnelli family which also controls Fiat itself, quoted chief executive Sergio Marchionne who said: "Now we cannot make any mistakes, the whole world is watching us and the responsibility is enormous. To succeed we must remain humble and not delude ourselves that the work will be easy."

The Fiat boss said 'the responsibility is enormous'

An opinion piece in the respected daily Corriere della Sera , which also has ties to the Agnelli family, said "the real challenge [of turning around the fortunes of both Fiat and Chrysler] begins immediately".

Italy's Head of State, President Giorgio Napolitano, said it was a result which Italy "could be proud" of.

The more left-leaning La Repubblica was slightly more questioning.

It featured the leader of the opposition socialist party leader Antonio Di Pietro from Italia dei Valori. "I must ask how many more jobs will emerge from this arrangement? The answer to that can tell us whether the agreement in question was only the interests of profit, or those of the country."

Il Messaggero praised the role played by the US trade unions for their "constructive participation" in the forthcoming challenge to recreate a great Chrysler.

None of the major Italian papers made reference to the fact that Fiat made a loss of €411m ($545m:£366m) in the first quarter of this year as opposed to a profit of €427m the same period last year.

The deal, which has the blessing of both the US and Italian governments, was confirmed in the White House on Thursday. It should see Fiat take an initial stake of 20% in Chrysler once the Detroit manufacturer emerges from Chapter 11 bankruptcy protection.

Once the $8bn loan is repaid to US taxpayers, Fiat will take a 51% share.

Fiat is set to provide Chrysler with know-how and expertise at building smaller and greener cars - without any direct capital transfusion.