Fiat chief executive Sergio Marchionne said European countries need to take further action to resolve the region's debt crisis, despite measures so far taken to bail out Greece.

He also criticised European governments for failing to intervene to restructure the region's auto industry, unlike the US which has provided more than US$65bn to finance restructurings of General Motors and Chrysler. He added: “That intervention forced a major structural reorganisation and facilitated a courageous shift."

Marchionne said Europe's response to the sovereign debt crisis has lacked a coordinated approach from the beginning, and said the signals so far were "mixed and did not give much reason for optimism".

In addition to a EUR110bn (US$135bn) bailout of Greece, European nations are creating a financial safety net for indebted countries that along with support from the International Monetary Fund could total EUR750bn (US$920bn).

Marchionne told a Detroit Regional Chamber of Commerce event: “Failure to throw a lifeline to Athens could have set off a catastrophic chain of events. Yet the process of agreeing a bailout package was subject to foot dragging, uncertainty and nationalism."

Marchionne, who heads both Fiat and Chrysler, said the Greek rescue and the financial stability package represented a major step but Europe needed to go further in order to stabilise the economy.

"If these efforts are to achieve more than just buying time and deferring the problems, they need to go beyond merely providing aid. Only a more comprehensive approach based on the political will of Europe to protect not just its currency but also its future will enable a qualitative leap forward in the nature of the union."

Marchionne said that his five-year rescue strategy for Chrysler was on track and affirmed that the US carmaker would break even on an operating level this year and pay back US and Canadian loans by 2014.

He added that Chrysler's US$143m operating profit in the first quarter is evidence that its 2010 financial targets are achievable.

Chrysler plans to utlilise a new generation of Fiat-based small cars and fuel-efficient vehicles, starting with the Fiat 500 in December, to revitalise its line-up which is currently heavily reliant on big trucks and SUVs.