Background Information
The Chrysler Car Company is one of the world’s leading automotive manufacturers. Established in 1925, Chrysler was originally founded by Walter Chrysler in the wake of the success of his product, the Chrysler 6 car. The company quickly rose from its humble beginnings to become one of America’s most iconic car manufacturers. Thus, the company has been an integral part of U.S. automotive culture for over 100 years. Today, Chrysler continues to be a major player in the global automobile market.
Chrysler’s range of products is now vast and diverse. From passenger cars to sports utility vehicles (SUVs), minivans to pickup trucks, the company is firmly established in almost every market segment. It also produces luxurious up-market luxury cars under its pysicalbrand.
Naturally, this question of who owns the company has been on the minds of those who have invested in the company, or are considering investing in it. After all, knowing who’s running the show is always insightful. Additionally, so too is it interesting to see how the company is structured and owned. So then, who exactly owns the Chrysler Car Company?
Consequent Ownership of Chrysler Car Company
Chrysler was initially publicly owned, with shares sold to the public through the New York Stock Exchange in 1928. This changed, however, when Chrysler was acquired by Diamler-Benz AG in 1998. Diamler-Benz AG was predominantly owned and operated by the German-based Daimler Group.
The Daimler Group would control the Chrysler company until 2007. This came to an end when the company was sold to Cerberus Capital Management, a private U.S. based investment firm, led by fortunes businessmen Stephen Feinberg. This sale marked the transition of ownership from European to American hands.
Subsequently, Feinberg and Cerberus ran the company until 2009. However, with the threat of bankruptcy looming, the U.S. Government had to intervene. At this point, the U.S. Government assumed direct ownership of the company, with an estimated 80.1% stake.
The assumption of ownership by the U.S. Government only lasted until 2011. After a successful restructuring, and agreement to pay back the Federal Government’s loan, the company was passed on to a new owner. This time, the Fiat Group, an Italian automaker and parent company of Fiat Chrysler Automobiles (FCA), was the new owner. Under Fiat, Chrysler has become a subsidiary of FCA and continues to be owned by the firm.
Current Ownership Structure
Since 2011, Chrysler Car Company has been a subsidiary of FCA. FCA has various shareholders, including holding companies, trusts, and Pension Funds. Additionally, the company is now several parts owned. Exor N.V., a Dutch-based holding company, is the majority shareholder in the company and holds 29.19% of the voting rights. Furthermore, with 29.07%, the Larry S. Thompson Trust is the second largest voting shareholder, with a combined share of 58.26%.
Apart from these two, the company also has several other voting shareholders. These include a collective of Italian and U.S. based mutual funds, Flaherty & Crumrine, the largest shareholder amongst U.S. based Pension Funds, with a stake of 5.50%. Additionally, the Ontario Teacher Pension Plan Board (OTPPB), a Canadian company, holds 1.50%. Smaller voting shareholders include UBS, Wellington Management Company and The Vanguard Group, amongst others.
Excluding voting shares, the company’s free float is owned by several leading international investment firms. These include BlackRock with a 5.03% stake and Capital World Investors with a 4.71% stake. The rest of the free float is dispersed amongst numerous institutional investors and hedge funds.
Analysis & Experts’ Perspectives
The ownership structure of the Chrysler Car Company gives insight into its history and the various parties involved with the company. Key experts have weighed in on the company’s ownership structure, and how it has been shaped by the events of past decades.
Financial analyst, James Haggerty commented on the strength and diversity of key shareholders, “The ownership of Chrysler Car Company is a case of stability and strength. Multinationals, institutional investors and even pension plans have vested interests in its progress… This ultimately could benefit their vested interests.”
Senior industry consultant Jonathan Kenworthy states, “Chrysler’s past has been full of twists and turns. From foreign acquisitions to the U.S. Government bailout, this is a company that has had to withstand more difficult times than most…. It’s no wonder that its current ownership structure is so diverse and far reaching.”
These perspectives give us an insight into the intricacies of the ownership structure of the Chrysler Car Company, and how this has been shaped by the turbulent past of a true automotive legend.
Companies Who Invested in Chrysler Car Company
Various companies have invested in Chrysler Car Company since its inception. Many of these companies are some of the biggest names in financial investments and automotive production.
One of the companies that have had a stake in the company is Daimler-Benz AG. The German giant was the majority shareholder of Chrysler from 1998 to 2007. During this time, the company was able to transform the company’s product range, introducing luxurious up-market vehicles and transitioning the firm into a true global automotive manufacturer.
In addition to this, Exor N.V., an Italian-based holding company has invested large sums in the company. Exor currently holds 29.19% of the voting rights in the company and is the majority shareholder since 2011.
Other companies that have invested include UBS, Wellington Management Company, the Larry S. Thompson Trust, Flaherty & Crumrine and the Ontario Teachers’ Pension Plan Board.
Insights & My Analysis
Chrysler has had a long and turbulent ownership structure since its inception in 1925. It has been subject to foreign ownership, U.S. Government intervention and a host of individual and institutional investments.
What we can see is a diverse and far reaching ownership structure, with numerous innovative companies buying a stake in one of the U.S.A’s most iconic car companies. Furthermore, we can see the strategic importance of diversifying the ownership and the various benefits such an approach can bring.
This approach can bring stability and strength to a company, and allows multiple parties to share the success of the venture. Additionally, it allows a company to take advantage of the skills and knowledge of many people for the furthering of the automotive industry, giving us cars of exceptional calibre.
Atypical Buying Strategies
The ownership structure of Chrysler Car Company doesn’t just reflect a traditional approach to investment and ownership. At its core, the company has experienced various different buying strategies over the course of its history.
One of the most significant buying strategies was the use of U.S. Government intervention as a means of restructuring the company and averting bankruptcy. This intervention though cumbersome and costly, ultimately saved the firm and allowed it to continue it’s legacy of manufacturing iconic vehicles.
Furthermore, the ownership structure of the firm has changed multiple times due to foreign divestment and acquisition. This look at foreign investments into the company has given us key insights into the strategic nature of the automotive industry and its need for international diversification.
These buying strategies, though not typical, have been imperative for the progression of the company and the industry as a whole.
Current Industry Impact
What we can also see from looking at the ownership of the company is its current impact on the industry. The company has gone from strength to strength, despite the obstacles it has faced.
Using its innovative approach to ownership and its clear direction, the company has produced a range of cars that have pushed the industry forward. The impact of this development has been immense, with industry analysts referencing the progress of Chrysler as a key development in the industry.
The company’s recent foray into the electric and hybrid car sector has also been a major development. Chrysler has taken advantage of the changing attitudes towards climate change and environmental awareness; this has been a welcomed addition to the automotive industry and will no doubt be a huge contributor to the company’s success in the coming years.
It’s clear then, the ownership of the Chrysler Car Company has had an immense impact on the automotive industry. From its humble beginnings to its role as a global automotive manufacturer, the firm has been integral to the industry’s development and shows no signs of slowing down.
