FCA: Merger With PSA to Be Finalized Early Next Year
The FCA-PSA merger is progressing nicely. According to Fiat Chrysler CEO Michael Manley, the joint timeline established last month is totally feasible. Both companies hoped to get this settled before 2022; Manley now believes everything could be settled within the next 12 to 14 months.
The manufacturers have inked a binding agreement — worth an estimated $50 billion — to collaboratively prepare themselves to fend against slowing global demand and the unpleasantly high cost of developing greener vehicles to appease regional emission laws. They’re also attempting to establish an effective comprehensive strategy for the numerous auto brands involved in the deal. While we speculated about Chrysler’s future yesterday, over a dozen other marques that cater to fairly specific customer groups also need to be considered.
“Talks are progressing really well,” Mike told Reuters at the sidelines of meeting hosted by the European Automobile Manufacturers’ Association (ACEA), which he also heads.
Fiat and Peugeot are now getting into the details of how the merger will work, including choosing which vehicle platforms — the technological underpinnings of a vehicle — will fit which products in a combined company.
Because customers in different locations still prefer vastly different cars, there is room for multiple platforms in a combined group, Manley said.
“That global platform is an elusive beast,” he added. “This concept of a massive global platform in my mind is almost a myth but that doesn’t mean to say we’re not going to recruit significant volume.”
Expect successive leaks and interviews over the coming months to better outline how this is all supposed to come together. Right now, Manley saying talks are running smoothly is good enough. FCA has dreamed of finding itself in this position for years; understandably, it doesn’t want anything fouling up the deal.
Thus far, both firms have promised no plant closures or worker cuts following completion of the deal. That seems like an impossible pledge to keep, and it doesn’t ensure anything in the interim period. PSA will also have one more member on the board of the combined firm than FCA, leaving many wondering how big a priority North America will be a few years down the road.
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