Chapter Three: The Year That Changed Detroit Forever
2009 really was the end of Detroit, as it had been known for more than a century, and the repercussions are still being felt
January 20, 2009, stood to be a historic day. Barack Obama and his wife Michelle traveled to the U.S. Capitol for his inauguration as the nation’s first Black president.
In Detroit, another type of history was being made. Fiat, the Italian automaker, announced that it was buying a 35 percent stake in Chrysler, a deal that took place nearly under anyone’s radar. Fiat and its brands were powerhouses in Europe, and the company actually was one of the first auto companies allowed to import vehicles in China.
But Fiat had not sold vehicles in the United States since 1982, when its American sales had dwindled to only 15,000 vehicles. Why would it want to come back — and why would it take on Chrysler at such a time of crisis?
For one thing, the deal did not cost Fiat any money. Facing stiff competition in Europe, it was looking for an outlet for small cars like the Fiat 500, which had been successfully re-introduced in 2007. Chrysler’s dealer network meant it would not have to create its own once it was ready to re-enter the U.S. market.
Chrysler, which was heavily reliant on sales of light trucks, desperately needed some attractive new products. It ended 2008 with just 12.7 percent of the U.S. market, a loss of 2.2 percentage points in only two years. Toyota, which passed Chrysler in monthly sales in 2003, just as my book was published, leapfrogged both Chrysler and Ford for 2008 to rank second in U.S. market share behind General Motors.