Hyundai's Getting Ready to Pounce on Fiat Chrysler, Report Claims

Steph Willems
by Steph Willems
hyundais getting ready to pounce on fiat chrysler report claims

Fiat Chrysler Automobiles won’t comment on a report claiming Hyundai Motor Group plans to launch a bid for the automaker, but that’s what sources with knowledge of the matter tell the Asia Times.

The sources claim HMG CEO Chung Mong-koo is biding his time, waiting for FCA’s stock to fall before moving forward on the potential takeover. Reportedly, Hyundai could launch the bid within months.

FCA CEO Sergio Marchionne retires in April 2019, with his successor an unknown quantity at this time. If Chung Mong-koo truly wants a takeover, he’ll act before Marchionne steps down, the sources claim.

Apparently, the driving force behind a potential merger is Paul Singer, billionaire activist shareholder and Elliott Management principal. Singer holds a $1 billion stake in Hyundai. His ties to FCA are more personal, however. Singer recently took control of Telecom Italia, naming Alfredo Altavilla, head of FCA’s Europe, Africa, and Middle East regions, as one of its board members. Altavilla’s name has been mentioned as a possible Marchionne successor.

Apparently, there’s quite a bit of disagreement between Marchionne and FCA chairman John Elkann over who should fill the CEO’s shoes. “Marchionne is pushing for [FCA CFO] Richard Palmer, while Elkann wants an industrial CEO to take over such as Altavilla or [Ram/Jeep head] Michael Manley,” one FCA source told Asia Times.

The sources allege Elkann, who also heads Exor N.V. — an investment group controlled by the Agnelli family, which holds over 29 percent of FCA’s stock — is more interested in growing a media empire than controlling FCA. A merger with Hyundai would give FCA access to the electric vehicles its truck-heavy portfolio generally lacks. (The money-losing Fiat 500 EV, FCA’s only North American EV, was famously panned by a scornful Marchionne.)

Marchionne, of course, is very fond of seeking mergers. Potential tie-ups with General Motors and Volkswagen Group never got off the ground, but sources claim the CEO used interest from China’s Great Wall Motor “as a stalking horse” to catch Hyundai’s eye and soften the Trump administration’s reaction to a future, non-Chinese takeover.

As we said, the automakers aren’t talking, so we’re left waiting to see if anything comes of this.

[Image: Fiat Chrysler Automobiles]

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  • Carroll Prescott Carroll Prescott on Jul 05, 2018

    Acquire FCA - prune Chrysler, keep FIAT in Europe, keep Jeep and Ram since those are areas Hyundai is weak. Dodge is really not remarkable, but the Charger has some value. Develop the next Charger so that the next Stinger will have platform sharing opportunities - they don't compete now as positioned. And may turn Chrysler's minivans into Dodges or Kias.

    • Sgtjmack Sgtjmack on Jul 12, 2018

      Except the Stinger is a little smaller than the 300/Charger. The Stinger is also front wheel drive as opposed to the 300/Charger being rear wheel drive, but both are available in AWD. That being said, I don't understand how they would make the two vehicles on the same platform. Dodge still makes the Caravan, and just started selling them again relatively recently, so I don't understand what you mean by turning the Chrysler Pacifica (T&C) into Dodge.

  • Sgtjmack Sgtjmack on Jul 12, 2018

    Junk building junk. Man, the guys at Chrysler can't get together with a truly quality brand to save their hind ends. Even Daimler-Benze couldn't stay with their crap products until the end of their contract.

  • ToolGuy VW (marque not group) and Tesla very nearly switched positions on a YTD basis.
  • RHD Inexpensive gasoline appears to be a thing of the past. ILO is correct - we have enough sunlight, wind and emerging ocean wave energy to power the entire country and then some. Clean air is nice, and being free of the whims of OPEC, geopolitics and hugely profitable oil companies will do all of us a world of good.
  • Raymond Segura Can you tell me where I can get the rear bumper for 69 impala?
  • Art Vandelay some of the crazy numbers I get. Percentages look bigger with any fluctuations with low volume makes and brands leaving the market will see massive month over month changes. But what’s with Buick? I still see the occasional ad on TV and yet the drop is disproportionate even compared to all the other GM brands.
  • Master Baiter "There is no mandate for consumers to buy EVs, not in any country or state. That’s made up."Right. And you are not mandated to purchase a toilet that only uses 1.6 gallons/flush. You could choose to not have a toilet--just go in the woods, like the bears do.