PoD:
Due to a bad hair day, or a bad night, Mussolini never decides to have a go at France in June 40.
But the French collapse and go Vichy as usual (incl. Mers-el-Kebir etc.).
The Italians remain strictly neutral, but are secretly negotiating with the British about sharing the Vichy French colonies. In September 1940 Italian forces enter Tunesia and French Djibuti and soon overruns Algeria and Morocco too, and British take Syria and Lebanon. The Germans are furious, but realise that Germany has no chance of intervening in those parts of the world anyway and stays calm. Vichy France is at war with Italy, but the Italians are told from Berlin, that if they stay out of France nothing will happen. Simultaneously British (Commonwealth) and Thai troops land in French Indochina but so does the Japanese. It soon comes to fighting, and although the Vichy French are ordered to side with the Japanese, it is obvious from the mass defections, that they prefer other masters. Both sides say that they only invaded to keep the other out, but as usual the British are better at propaganda. British Empire and Japan are now at war with each other, but the Italians remain neutral. With safe access through the Med. and Middle East the British have a far easier job in keeping forces in the Far East and the Japanese have a hard time in French Indochina, and the IJN hesitate to enter any major battle with the strong RN squadron now based in Singapore and controlling the South China Sea.
In USA the President is deeply concerned, but sees no possibility to enter the war. The US presense in the PI is reinforced however and a strong naval squadron is sent there too. Naval advisers warn the President that this squadron really is out on a limp, but the President insists that the squadron is sent, and that it includes most of the Pacific Fleet's battleships and a couple of carriers for aircover. USA also keep up the blocake on Japan until she withdraws from China and French Indochina.
Meanwhile the British and Italians negotiate about the Balkans. Basically Italy wants British acceptance/support for the Balkans being an Italian sphere of influence, but the British hesitate to pay that much.
At the same time the Italians are negotiating with the Bulgarians and the Yugoslavians. The Bulgarians are keen to join anything involing a go at the Greeks, and the Yugoslavians show interest in a security guarantee involving both Italy and GB, as this would appear to give Yugoslavia a real chance of resisting German pressure.
As this goes on the Japanese have grown very nervous over the increasing US Forces in the PI, and realise that they won't be able to deal with the British before they have removed this thorn in the side, and decide to make a surprise attack on the US naval squadron while it does one of it's numerous promotion tours. On 7th of december 1940 the US squadron is caught by surprise, and although fighters suceed to get off from the carriers and inflict heavy casualties on the attackers, three out of four BB's and both carriers are sunk in deep water. Divebombers from the USN carriers succeed to get in the air and see their mother ships sink, but decide to go in the direction the enemy came from. Minuttes before they run out of fuel, they spot the IJN carriers and dive against them. Knowing that they have no possibility of returning many dive directly into the IJN ships, and within a few minuttes all four IJN carriers are ablaze and sinking.
In Washington Adm. King is furious at the President "You should have listened, I told you they were vulnerable over there!" The President smiles calmly and hands Adm. King a report from the cosmic topsecret Ultra interception saying that the IJN has lost all of it's operational CV's in a heroic suicide attack from USN divebombers. "We have taken great losses, but so has the enemy. Now we're in the Asian war and do not risk anylonger that either the British or the Japanese run with it all, I must compliment you and your men on a splendid job done!"
In Japan the radio boosts over a great victory over the Americans, and tells nothing of what happened to the IJN CV's.
In just the same hours a coup d'etat is going on in Yugoslavia. Croat and German friendly circles want to prevent the approaching to Italy and GB, fearing this will give the Serbs too great dominance. Fighting breaks out in Yugoslavia between rebels and troops loyal to the government. The Italians and British realise that it is now or never and openly support the Yugoslavian government around young King Peter, and soon a lot of Italian and a few British troops land in Yugoslavia.
This is the drop for Hitler and war is declared on Italy. Mussolini for a moment feels he has entered something he can't overlook, but is reassured by British reinforcements. And although the Americans are not at war with Germany they promise deliveries. Anyway he couldn't have kept anything going without the constant supplies of strategic materials and equipment from the Anglo-Saxons. The Italians are soon thrown out of Yugoslavia and Balkans, but the well fortified lines at the Isonzo and in Savoy so far has hold, and the growing British RAF and Army contingent is nice to have.
As we pass into 1941 the accelerating British production begins to tell. For the Japanese Indochina is very far away, especially as they have to go through a hostile China or subinfested seas. And with most CV's sunk the IJN doesn't dare to undertake major operations against the PI, Dutch East India or South China Sea.
In Germany they have realised they are in a difficult position. Although the German Army and Air Force is as mighty as ever, it has so far been impossible to penetrate the Italian fortifications in the Alps and large forces has to be kept guarding against the Russians. The Russians must be dealt with before the Americans enter the European war and the Japanese agree to operate against Siberia. They can't operate in SEA anyway, have idle army forces and are desperate for raw materials, why not try Siberia - nothing left to loose.
The French and Croatians are given the job of containing Italy and GB, while Germany, Hungary and Romania are to attack Russia with 200 Divisions in mid 1941 and 40 Japanese Divisions into Siberia...
Regards
Steffen Redbeard