Earlier:

…
Note there will be no IPO from Chrysler, the weakest of the formerly Big Three, for some time; the Canadian and Ontario governments have a fair bundle invested in Fiysler too…

Now:

Some Chrysler Dealers See Un Problema in Fiat’s Plans

As Chrysler Group LLC prepares to lay out its strategy for selling a subcompact car from partner Fiat SpA, the move is raising concerns among some dealers struggling to sell the vehicles already on their lots.

The launch of the Fiat 500 would introduce a fifth brand into the Chrysler family, alongside the Chryslers, Dodges, Jeeps and Ram trucks most dealers carry now.

Chrysler and Fiat hope the tiny Fiat 500 becomes a sales and pop-culture hit along the lines of the Mini Cooper…

Some Chrysler dealers also say they are concerned about investments those chosen to sell the Fiat 500 will have to make. Chrysler, for instance, wants dealers to build separate showrooms for Fiat, which could cost hundreds of thousands of dollars each.

“The enthusiasm for the Fiat coming to the market has diminished,” said one East Coast Chrysler dealer who is still weighing whether he will apply to sell the 500.

“At first, it was something that would be mixed in” among Chrysler’s current models on the showroom floor, this dealer said. Now, “they are going to have to present a compelling story and product to back me investing at least $1 million to build a new showroom.”..

The Fiats will start with the 500 model arriving in December from a Chrysler plant in Mexico. A convertible is expected in 2011.

Plans also call for the sale of Fiat’s Alfa Romeo vehicles in the U.S. [see below for possible Ontario connection], which Mr. Marchionne said on Monday most likely would happen through the Fiat showrooms. Chrysler said it will locate Fiat dealers in top urban markets with the strongest small-car sales…

One Chrysler dealer in Florida said he was spooked by the experience of dealers who sunk money into selling the Smart, a tiny car made by Daimler AG, and the Mini Cooper, from BMW AG, and haven’t seen a payback.

Smart is sold through dedicated dealerships. Sales fell from 24,000 in 2008 to about 14,000 in 2009 and are down 61% this year through July. Mini has seen its sales languish since peaking at 54,000 in 2008. BMW dealers sold 45,225 last year and sales year to date through July were down 1.9%.

The Fiat 500′s arrival is being planned as industry sales are tepid. J.D. Power and Associates last week cut its 2010 U.S. sales forecast to 11.6 million vehicles, down from 11.7 million. Gas prices, which helped pushed many Americans into smaller cars in 2008 when they topped $4 a gallon, remain below $2.50 on average…

More:

Chrysler chief says profit will be ‘difficult’ this year
…
• [Chrysler CEO Sergio Marchionne] Said a decision must be made soon on whether to build a large luxury sedan for Alfa at the plant in Brampton, Ont…

I can’t see much serious profit in the Cinquecento at a price American buyers will pay for such a small car:

Fiat 500 gathering at Biltmore Estate…

Road test here.

Mark
Ottawa