. Marchionne added that car makers in the developed world are "totally ill-equipped to deal with China as a market and to deal with policy changes that come out of Beijing." Chinese automakers will have a huge competitive advantage due to the scale of their market, and the capital efficiencies that will bring, he said. Excluding China, there will eventually be only five large car makers in the developed world, Marchionne said, each producing 5 million to 6 million cars a year and sharing car designs and architecture globally. Chrysler and Fiat will together be the world's fifth-largest car maker this year, Marchionne said. Without combining their operations, neither car maker will last in the new period of consolidation, Marchionne said. Fiat took a controlling 53.5% position in Chrysler in July by purchasing ownership stakes the U.S. and Canadian governments acquired when providing bailout loans for the car manufacturer during the financial crisis. As the Italian automaker steadily increased its Chrysler holdings this year, Marchionne began discussing the idea of merging Fiat and Chrysler this year into a single, global group that would have the scale to compete with larger competitors such as General Motors Co. (GM), Volkswagen AG (VLKAY) and Toyota Motor Corp. (TM). Marchionne said that Fiat and Chrysler made a good combination because Fiat needs the U.S. as a market, and Chrysler needs Fiat's expertise in designing small engines in order to meet coming U.S. fuel-efficiency standards, and to broaden its business through Fiat's distribution network in South America. Chrysler will sell about 2.4 million cars next year and make more than $3 billion in profits, Marchionne said. Fiat and Chrysler together will sell about 4.2 million cars together this year, making them the world's fifth largest automaker when considered as one entity. Marchionne said the U.S. auto industry had suffered in recent years because they were more focused on gaining profits from their financial arms rather than improving the profitability of their car-making operations, which he said in many cases fell into "industrial neglect." "We had lost sense of what our ultimate objective wa