Chrysler Has Aggressive Plan for 2014 Profit; Product Changes Page 2

November 9, 2009

2009 Dodge Caliber SRT4

We believe the market grossly underestimates the value of Chrysler to Fiat (which is) our top pick in Europe with over 60 percent upside to our 18-euro target, Morgan Stanley said.

Even a partial achievement of targets would make an IPO of Chrysler likely by 2011, the financial firm noted. Chrysler said it sees an IPO by 2014 but thinks it highly unlikely before 2011.

JP Morgan notes that if sales targets are met, the value to Fiat could be worth an extra 4.5 euros per share with room for 2.5 euros per share, with room for 2.5 euros per share upside by 2011, Reuters noted.

However, if Chrysler sales do not pick up, the market may take a simmer view of Chrysler's prospects which would suggest as much as 10 to 15 percent downside to Fiat shares, Reuters noted this morning.

In October, Chrysler U.S. Sales fell 30 percent while GM reported its first monthly sales increase in two years.

Credit Suisse told the news service that it sees the plan as highly aggressive but while significant cash risks to Fiat investors remain we expect a sharply recovering U.S. market to prompt investors to take a more optimistic view on the asset.

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