In 1899, businessman's son Giovanni Agnelli put up $400 to help found Fabbrica Italiano Automobili Torino (FIAT), which manufactured the newly invented horseless carriage in Turin. Fiat went on to dominate the Italian car market, with a flair for cheap-but-chic models such as 1936's Topolino and 1957's Nuova 500. It also diversified into commercial vehicles, defence work, agricultural equipment and more. Agnelli's grandson, the debonaire 'Gianni' Agnelli, pursued international expansion vigorously: as chairman (1966-1996), he became known as 'Il Re', the unofficial king of Italy. In 1976, amid one of Fiat's periodic financial crises, Agnelli sold a 10% stake to Libya's Colonel Gaddafi, although he later repurchased it.
By the late 1990s, the Fiat empire accounted for almost 5% of Italy's GDP and included Maserati and Alfa Romeo, as well as Lancia and Ferrari. Nonetheless, its share of the domestic market had halved to around 30%. Agnelli died in 2003, shortly before losses of EUR4.3bn were announced. The family stake passed to grandson John Elkan, now chairman.
Who's the boss?
Fiery Italian-Canadian Sergio Marchionne took the wheel as CEO in 2004. Despite - or because - of his reputation for impatience and a short temper, by 2006 the car business was profitable again. Marchionne says Fiat must become one of the world's top five car manufacturers in order to have a long-term future: an ambition which his bold deal with US Chapter 11 survivor Chrysler is key to achieving.
Fiat now has a 20% stake in the risen-again giant, and a readymade distribution and service network in the USA. Chrysler gets access to Fiat's world-leading small car technology, and Marchionne heads both firms.
The secret formula?
The small cars - such as the Uno, Punto, Panda and 500 - have always been its best products, so Fiat should prosper in today's market. Last autumn, the car business was demerged from the rest of the group. Prospects for Chrysler's US models in Europe look less rosy, however.
Fiat re-entered the US in January, 27 years after it retired hurt from the world's largest car market.
The 1970s, when build quality was so low mechanics coined the acronym - 'Fix It Again, Tony'.
Operating profit: EUR1.1bn
Gross margin: 3.1%
[All figs for demerged Fiat car business, financial year 2010]