Rumor: Fiat Looking to Buy MV Agusta?

03/24/2014 @ 3:22 pm, by Jensen Beeler18 COMMENTS

Rumor: Fiat Looking to Buy MV Agusta? fiat mv agusta 635x425

Undoubtedly fueled by Audi’s purchase of Ducati Motor Holding, rumors out of Italy now peg Fiat to acquire MV Agusta. While neither party will talk about the rumors, it is no secret that MV Agusta is in need of more cash, as the company had difficulty securing credit after the Castiglioni’s repurchased the company, now debt free, from Harley-Davidson.

This has lead to the Varese brand releasing a rapid succession of closely related motorcycles in an effort to bolster sales and penetrate new market segments: the MV Agusta F3, MV Agusta Brutale, MV Agusta Rivale, MV Agusta Turismo Veloce, and MV Agusta Dragster. The company’s financial position has also fueled CEO Giovanni Castiglioni to talk last year about a possible IPO by as early as 2016.

The position of MV Agusta’s rocky financial situation makes the Italian company a poor target for an IPO. Instead, investment by private equity firm or an acquisition by a larger company, like Fiat, would be MV Agusta’s best bet for capital injection and business stability. Add to that, there is a certain Italian romance to the Turin-based Fiat brand acquiring MV Agusta, which is just down the street in Varese.

Is there any truth to these rumors? Only the respective parties can know. Without a doubt, such a move would be a huge boon to MV Agusta, and could do a lot to secure the company’s future. However, it is much harder to understand such an action from Fiat’s point-of-view.

MV Agusta would require substantial resources from Fiat in order to become even a self-sustaining business venture, add to that the amount of money it would require to grow MV Agusta into something that would significantly add to Fiat’s bottom line.

With the way European regulatory laws work, there is some value for car company to have a motorcycle subsidiary, however those advantages primarily benefit brands that don’t do a great deal of volume on high-efficiency, low-foot print, vehicles (read: Mercedes-Benz, Porsche, Audi, etc).

With Fiat already a leading European brand in this regard, the non-monetary benefits of having MV Agusta are simply just not there for the Italian automaker.

With analysts still not sure about the benefit of the Ducati/Audi deal, and MV Agusta only a fraction of the company that Ducati was when it was acquired, there is certainly a lot of wisdom to question. We bet Fiat could get a killer price though, and crazier things have happened. Stay tuned on this one.

Source: Moto.it

Comment:

  1. Ed says:

    If they made it a subsidiary of Ferrari, Alfa Romeo, or Maserati it would serve the same purpose as Ducati does for Audi under the Volkswagen Group umbrella. And maybe Ferrari missed Ducati and Vrooom this year and wanted a motorcycle manufacturer there.

  2. Damn says:

    when wil they learn. history buyers history.

    Don’t!!!!buy

  3. paulus says:

    This would be the perfect marriage… for a disaster.
    No problem the Italian government is always ready for a bail out deal, once MV suck the maximum allowable funds out of Fiat.

  4. Quiet American says:

    Does this that MV Agusta will promptly leave the US market and spend the next four decades telling us they will be back in 18 months. I hope not as I really like the motorcycles and their history.

  5. Quiet American says:

    In all seriousness, I think MV has boxed themselves out of the product line that could make them solvent as an independent company. This is a full line of liter to 1200 cc triples. The 650-800cc triples are supposedly really nice, but they are just too small for the mature buyers who can afford luxury bikes. The fours cover that range but aren’t as exotic, and maybe are not even on par with less expensive but parallel German and Japanese offerings.

  6. Jaybond says:

    Personal interest perhaps? Or maybe Fiat sees motorcycle as an area that they could potentially further add to their bottom line in the near future. No doubt, MV Agusta brand is getting stronger than ever with evergrowing model line up as do their sales figure. If indeed Fiat is going to acquire MV Agusta, with careful management and product planning & better QC, MV Agusta will certainly add more value to the Fiat auto empire..

  7. Gutterslob says:

    Bring on the MV Punto!!

  8. Peter says:

    MV has probably more dealers in the US than FIAT…
    Btw there are FIAT “companies” – at least that was my understanding:
    The conglomerate FIAT that also own Ferrari and FIAT the car manufacturer.
    http://en.wikipedia.org/wiki/Fiat

  9. mb says:

    quite interesting, especially if you keep in mind the recent expansion plans of Italians as Fiat Chrysler Automobiles. And yep my US friends, as Peter said, FIAT owns Dodge, Jeep, Chrysler, Maserati, Ram trucks, Ferrari and some more brands known probably more in Europe as Abarth, Alfa Romeo, or Lancia. Quite a big business!

  10. smiler says:

    What I find funny about the comments from the Americans here is that it was Harley that snuffed out Buell and nearly did the same to MV. Having finally managed to get its act together after being eaten and thrown up by the chrome and leather clad mechanical elephant. MV now wants to secure its future.
    Having been independent previously and failed, motorcycle companies will go the same way of car companies. They need to be part of a bigger organisation if small, very niche or very large. MV does not have the history to be able to produced 50 – 100K bikes a year.
    What else should MV do?
    I would much rather see MV with Ferrari, Fiat, Alfa & Maserati than az a trofie purchaze by zee Germanz or purchased by KTM.
    In many ways it is sad that Ducati was not bought by Fiat instead. Zee Germanz are already sowing zee seedz of blandnezz there. As they have at Lambo.

  11. Superlight says:

    Smiler, Lambo products are bland? Look again. The most recent cars are a lot of things, but not bland.

  12. sburns2421 says:

    Smiler,
    Harley poured money into MV and then gave it back to the Castiglioni family for one Euro IIRC. This isn’t to defend Harley, IMO they never knew what to do with MV (or Buell for that matter).

    Fiat owning MV? Doesn’t sound like a bad idea at all. The US government split ownership of Chrysler with Fiat and the United Auto Workers union, the arrangement seems to be working “ok”. But Fiat undoubtedly understands niche, expensive status vehicles like MV. They have owned Ferrari for almost 50 years and it is arguably the greatest “brand name” in the world along with one like McDonalds, Nike, and Coca-Cola. Maserati and soon Alfa have very desirable cars, that are practical enough to use every day.

    Fiat guiding MV’s development could be a very good thing, even if in the short-term it just meant refinement of existing models. All recent tests of the MV fours and triples basically say there is an incredible bike in there somewhere, but lack of development (electronics mostly) prevents the package from being all that it could be. If some of that Ferrari or Maser magic could be rubbed off on MV, they could be the total package.

  13. John Mith says:

    I think this is a great idea. MV suffers from a huge lack of resources in general. It’s painfully obvious in their new product releases which don’t even seem to have been tested on a track. Fiat could provide MV the engineering resources it desperately needs to turn a profit.

    I’m also quite perplexed with MV’s approach to their new models. Since 2010 their bikes have seen a massive decline in quality after Harley got involved. These new bikes include “features” such as aluminum wheels cast in China and a lot lower quality fit and finish than previous generation bikes. Pricing has steadily dropped as well and they have entered into much cheaper models such as the F3 line and the other new lines that they are producing. Are they still trying to be a premium product? I don’t think that competing with the Japanese on their turf is a really good idea. They have no possible way to compete at the scale that the Japanese do.

    I find the owners to be quite an amusing bunch as well. I own several “older” F4’s and the owners of the new bikes have this snobbery thing going even though the original bikes cost MORE than theirs did when they sold new. Even though the new F4’s boast up to 201hp their engine and in fact most of the engineering dates back to the original F4 750. I get the idea that some of these owners would buy Chinese scooters as long as there were MV logos painted on them. Its quite sad that most of them are so caught up in the brand and the marketing to realize what’s really going on.

    If Fiat can give MV a anything I hope it’s a dose of sanity and some additional resources. MV can only survive as a premium upscale product. Please someone at Fiat return these bikes to being the hand made bespoke Italian crafted bikes that they once were. Even if you have to raise the price and lower the production numbers there are owners out there that recognize the value. In the current situation I would not even consider a new MV with Chinese wheels on it.

  14. sunstroke says:

    Smart decision by FIAT

  15. L2C says:

    @ Superlight

    I think the new Huracán is the most distinctly beautiful car Lamborghini has ever produced. Only Ferraris were ever so lustful.

  16. AHA says:

    Oh no! Never mind an exotic motorbike company, Fiat has an excellent record of buying car brands and ruining them. Lancia & Alfa Romeo being prime examples. Ferrari saved themselves, not Fiat. Maserati is in permanent take-off mode but never seems to reach cruising altitude – you have to think many other auto-industrial groups would have done a better job. Plus Fiat has no surplus cash since the Chrysler acquisition and its car division has a very depleted list of cash earning models. Its main priority is supposed to the continually postponed relaunch of Alfa including re-entry into the US market. Senior mgmt at Fiat have no time & no ability to help MV sort out its problems. It’s such an obvious disaster even by Italian standards, I’ll be very surprised if this even comes close to happening.

  17. Quiet American says:

    @mb
    Most of us know about Fiat’s portfolio, and those of us with agricultural ties know about several other divisions in that spectrum. We have been through numerous attempts to save Chrysler: the US taxpayers, Iacocca, Chrysler saving Jeep – but maybe it was the other way around, Kirk Kerkorian, Iacocca and some other investors, Kerkorian and Iacocca, Daimler Benz – or maybe as diehard Mopar fans claim it was the other way around, Cerberus, Government Car Czars, Fiat and UAW Chrysler, and now just Fiat, but maybe this one is really the other way around, too.

    It will take years to know how the story unfolds on this Chrysler buyout, and how do you even comment on that in a few sentences? We do know, however, that Fiat struggles mightily to get their niche divisions here. If they do, they then have a record of failing to provide adequate distribution and service. This is why comments relating to the never-ending Alfa reintroduction debacle are the easiest to post.

  18. ascended_master says:

    The synergy here lies with Ferrari. There is some recent history to this, Ferrari had a hand in the design of the F4 motor & some may remember the Ferrari authorised MV/Dave Kay bike. This is a premium brand with a long history. Fiat well knows how to capitalise on this.

    I can see these bikes in Ferrari dealerships, the brands would complement each other very well.