Abstract: Internalizing Finance in Industry: The Case of Simca, 1956-1962

Patrick Fridenson

Abstract

The development of international banks by carmakers is a little-known phenomenon in historical research. It raises important questions on the connections and interactions between industry and services, and on the alternatives between markets and hierarchies when firms need and generate large flows of capital. Simca was the French subsidiary of the Italian group Fiat. It was allowed by the French government to take over a French bank. The Compagnie financière de Paris worked for both Simca and Fiat in Latin America, China, and Portugal. It also broadened its scope to a few other customers and activities. It achieved a learning process in order to assess the performance of subsidiaries abroad and to face the various high risks of internationalization. Led by a woman, it was an innovative organization, the activities of which confirm recent theories on firms as collective efforts to create new potentials. But when the American company Chrysler bought Fiat's subsidiary, its role was soon over.