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

Steph Willems
by Steph Willems
hyundai s 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.

  • CEastwood Seven mil nitrile gloves from Harbor Freight for oil changes and such and the thicker heavy duty gripper gloves from Wally World for most everything else . Hell we used to use no gloves for any of that and when we did it was usually the white cloth gloves bought by the dozen or the gray striped cuff ones for heavy duty use . Old man rant over , but I laugh when I see these types of gloves in a bargain bin at Home Cheapo for 15 bucks a pair !
  • Not Previous Used Car of the Day entries that spent decades in the weeds would still be a better purchase than this car. The sucker who takes on this depreciated machine will learn the hard way that a cheap German car is actually a very expensive way to drive around.
  • Bullnuke Well, production cuts may be due to transport-to-market issues. The MV Fremantle Highway is in a Rotterdam shipyard undergoing repairs from the last shipment of VW products (along with BMW and others) and to adequately fireproof it. The word in the shipping community is that insurance necessary for ships moving EVs is under serious review.
  • Frank Wait until the gov't subsidies end, you aint seen nothing yet. Ive been "on the floor" when they pulled them for fuel efficient vehicles back during/after the recession and the sales of those cars stopped dead in their tracks
  • Vulpine The issue is really stupidly simple; both names can be taken the wrong way by those who enjoy abusing language. Implying a certain piece of anatomy is a sign of juvenile idiocy which is what triggered the original name-change. The problem was not caused by the company but rather by those who continuously ridiculed the original name for the purpose of VERY low-brow humor.