FCA, PSA to Employees: Merger Deal Is Just Weeks Away

Steph Willems
by Steph Willems

Undaunted by General Motors’ racketeering lawsuit, Fiat Chrysler and partner Groupe PSA have told employees that the tentative $50 billion merger they agreed on last month will kick off in earnest in a matter of weeks.

The two automakers imply a binding agreement will be signed before year’s end — right on schedule.

The message to FCA and PSA employees, intercepted by Reuters, came through two internal channels, with those workers being told a team of 50 people were working on the tie-up. Under the proposed merger, the new entity would be headquartered in the Netherlands, with PSA’s Carlos Tavares serving as CEO and FCA’s John Elkann as chairman.

No brands at either automaker would be on the chopping block, Tavares claims.

In creating the world’s fourth-largest automaker, both companies would be able to take advantage of the other’s technological know-how, as well as their presence in regions where the other might like to make inroads. For PSA, Fiat Chrysler’s North American dealer network might help ease its re-entry into that market. For FCA, its partner’s overseas presence and electrification tech could come in handy — not to mention its small car platforms.

Money saved through efficiencies is targeted at $4.1 billion a year.

According to the message sent to employees, nine working groups have been created to help make the merger a reality. Heading up these teams are David Ostermann, FCA’s group treasurer and head of business development, as well as Olivier Bourges, PSA’s executive vice president for program and strategy.

Much has been said about the potential risks to the merger posed by GM’s lawsuit, which accuses FCA of bribing UAW officials in order to corrupt the collective bargaining process and draw favorable concessions from the union. How this might impact the merger really depends on the strength of GM’s evidence and its ability to prove its claims in court. Meanwhile, the proposed merger seems to be speeding towards an agreement.

Aside from refuting GM’s claims (and claiming the suit represents an attempt to scuttle the merger), FCA hasn’t said much about it. PSA chose the “no comment” route.

[Image: Matthew Guy/TTAC]

Steph Willems
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  • Tstag Tstag on Nov 26, 2019

    A part of me really questions the wisdom of these mega mergers which seem designed to mask fundamental problems rather than address them. Far more impressive to me are the likes of Ford and Honda who stand alone with basically just one or two brands. Consider for example the relative success of an industry minnow like JLR. Sure they’ve had tough times but confront their challenges head on. Consider how a small company like JLR has beaten bigger players to market with an electric car, has expanded their range of products hugely in the past decade and has invested in new factories and plant while still more often than not turning a buck. For sure JLR and others like them may need partners to thrive but they achieve a lot with little. I think there is a lesson there for big car makers to learn from.

    • Inside Looking Out Inside Looking Out on Nov 26, 2019

      I thought they were brand under Ford and then Tata ownership. When they become independent? I missed that moment. And of course it was not Ford's money that developed new JLR models, because JLR is so profitable that they have no problem developing new platforms including one for BEV.

  • Akear Akear on Nov 26, 2019

    For the first time in nearly a century, FCA(Chrysler) will be larger then GM. It looks as if history will be made soon. GM - what a disgrace!

    • See 1 previous
    • Akear Akear on Nov 26, 2019

      @28-Cars-Later Due to protectionism I don't think GM can count on their Chinese made cars making it to US shores.

  • ToolGuy First picture: I realize that opinions vary on the height of modern trucks, but that entry door on the building is 80 inches tall and hits just below the headlights. Does anyone really believe this is reasonable?Second picture: I do not believe that is a good parking spot to be able to access the bed storage. More specifically, how do you plan to unload topsoil with the truck parked like that? Maybe you kids are taller than me.
  • ToolGuy The other day I attempted to check the engine oil in one of my old embarrassing vehicles and I guess the red shop towel I used wasn't genuine Snap-on (lots of counterfeits floating around) plus my driveway isn't completely level and long story short, the engine seized 3 minutes later.No more used cars for me, and nothing but dealer service from here on in (the journalists were right).
  • Doughboy Wow, Merc knocks it out of the park with their naming convention… again. /s
  • Doughboy I’ve seen car bras before, but never car beards. ZZ Top would be proud.
  • Bkojote Allright, actual person who knows trucks here, the article gets it a bit wrong.First off, the Maverick is not at all comparable to a Tacoma just because they're both Hybrids. Or lemme be blunt, the butch-est non-hybrid Maverick Tremor is suitable for 2/10 difficulty trails, a Trailhunter is for about 5/10 or maybe 6/10, just about the upper end of any stock vehicle you're buying from the factory. Aside from a Sasquatch Bronco or Rubicon Jeep Wrangler you're looking at something you're towing back if you want more capability (or perhaps something you /wish/ you were towing back.)Now, where the real world difference should play out is on the trail, where a lot of low speed crawling usually saps efficiency, especially when loaded to the gills. Real world MPG from a 4Runner is about 12-13mpg, So if this loaded-with-overlander-catalog Trailhunter is still pulling in the 20's - or even 18-19, that's a massive improvement.