French and Italian-U.S. auto giants Renault and Fiat Chrysler are set to announce talks on an alliance, with a view to a potential merger, informed sources said this week.Marco Bertorello / AFP/Getty Images PSA Group and Fiat Chrysler Automobiles have agreed to combine to create the worlds fourth-biggest carmaker, as the manufacturers prepare to shoulder the costly investments in new technologies transforming the industry.In the biggest auto tie-up since Daimlers ill-fated purchase of Chrysler in 1998, the French and Italo-American carmakers will each own half of the enlarged business.The new company, with global sales of 8.7 million vehicles, will be run by PSA Chief Executive Officer Carlos Tavares, with Fiat Chairman John Elkann holding the same role.The transaction would forge a regional powerhouse to rival Germanys Volkswagen and, with a market value of about US$47 billion, surpassing Ford. It will take as long as 15 months to complete, pending approvals by shareholders of both companies and by regulators, the carmakers estimated.Like executives across the industry, Tavares and Elkann are responding to growing pressure to pool resources for product development, manufacturing and purchasing in the face of trade wars and an expensive shift toward electric and self-driving technology.(Indeed, industry sources said that in the future, the new company plans to move “more than two-thirds” of production to “just two platforms, with 3 million cars per year on a compact/midsize platform and 2.6 million on a small platform,” reports Automotive News. “The smaller platform will be PSA’s CMP architecture and larger cars will be on the group’s EMP2 (while) Ram pickups and larger Jeep models will continue to use FCA underpinnings.” —Ed.)The challenges of our industry are really, really significant, Tavares, 61, told reporters on a call Wednesday. The green deal, autonomous vehicles, connectivity and all those topics need significant resources, strengths, skills and expertise.In an era when size is becoming ever more important, the deal will turn the two mid-sized carmakers into a global heavyweight, with a stable of popular brands and annual vehicle sales surpassing General Motors. The combination will give Peugeot-maker PSA a long-sought presence in North America and should help Fiat gain ground in developing low-emission technology, where its lagged rivals. Yet the new company will still be heavily reliant on Europes sluggish and saturated auto market, and poorly positioned in China, the worlds largest country for car sales.The companies are aiming to extract 3.7 billion euros in annual synergies from the deal, without closing any plants, unchanged from the target they announced when they disclosed their merger discussions. Chinas Dongfeng Motor Corp., which owns 12 per cent of PSA, will see its stake in the combined company decline to 4.5 per cent as a result of the deal and the sale of a portion of its holding to the French carmaker.Dongfengs stake in PSA has attracted attention because of the possibility it could interfere with U.S. regulatory approval. U.S. economic adviser Larry Kudlow said last month the Trump administration would review the proposed merger because the deal would give the Chinese carmaker a stake in the combined
Origin: Fiat Chrysler and Peugeot confirm merger into one US$46-billion automaker
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FCA and Peugeot-maker PSA confirm a 50-50 merger, forming new company
PSA Peugeot Citroen Chief Executive Carlos Tavares delivers a speech during the presentation of the companys 2018 full year results, in Rueil Malmaison, west of Paris, Tuesday, February 26, 2019.Thibault Camus / Getty The rumours are true: FCA (Fiat Chrysler Automobiles) is merging with PSA, the European maker of Peugeot, Citroen, Opel and Vauxhall vehicles, both corporations confirmed in a press release October 31.According to The Detroit Free Press, the two companies struck a deal that will see a 50-50 joint shareholder-owned entity. There would be no plant closures, and the combined entity would save 3.7 billion Euro annually.The two companies will have combined revenues of 170 billion Euro, with profits of more than 11 billion Euro based on 2018 figures. The new corporation will become the fourth-largest automotive group in the world. The hope is the partnership will see more automakers come together and develop self-driving technology and electrification. Under the umbrella of a Dutch parent company, the FCA and PSA will combine with a board made up of 11 members, of which each company will nominate five. Carlos Tavares of PSA will be the CEO of the new company, while John Elkmann will retain his role as FCA Chairman.The decision is still to be finalized in a memorandum of understanding in the coming weeks, but both brands have agreed to proceed.Before his death, it was FCA CEO Sergio Marchionnes vision to create a more consolidated automotive industry, and it seems like this is helping fulfill that vision.The new company will be listed on the New York, Paris and Milan stock exchanges. It isnt clear what the group will be called
Origin: FCA and Peugeot-maker PSA confirm a 50-50 merger, forming new company
BREAKING: PSA Group and Fiat Chrysler confirm merger plans
The PSA Group and Fiat Chrysler Automobiles have confirmed plans to merge on a 50/50 basis, firming up yesterday’s news that the two companies were in discussions regarding such a move. Both firms said today that the discussions would be finalised “in the coming weeks” to reach a binding Memorandum of Understanding, which will create one of the world’s largest automotive groups. They added that the “combined entity would leverage its strong global RD footprint and ecosystem to foster innovation and meet these challenges with speed and capital efficiency”. The likely merger will create a car giant worth around £40 billion and encompass some of the world’s biggest car brands. FCA owns Fiat, Jeep, Alfa Romeo, Maserati, Ram, Lancia and Chrysler, while the PSA stable includes Peugeot, Citroën, DS and Vauxhall-Opel. The deal would create the fourth largest car manufacturer globally in terms of annual sales, at 8.7m vehicles, behind Volkswagen Group, Toyota and the Renault-Nissan-Mitsubishi alliance, as well as revenues of €170bn (£147bn) and recurring operating profit of over €11bn (£9.5bn). Today’s announcement also stated there are estimated synergies of €3.7bn (£3.14bn) synergies annually “without any plant closures resulting from the transaction”. This would come from a more efficient allocation of resources for major investments in vehicle platforms, powertrain and technology as well as purchasing power. The two firms projected that 80% of the synergies would be achieved after four years. The shareholders of FCA and PSA will each take a 50 per cent stake in a new Dutch parent company, under the proposals, with the governance structure balanced between the two firms. There would be 11 board members, with five nominated by FCA and five by PSA. Current FCA chairman John Elkann will become the chairman of the new firm, while PSA group boss Carlos Tavares would become the CEO, standing on an initial five-year term. PSA Group chief Carlos Tavares is famous for cutting costs – for example, turning Vauxhall into profit in under 12 months of taking ownership – and PSA and FCA claimed the merger would make “among the highest margins in the markets where it would operate,” based on FCA’s strength in the Americas and PSA Group’s in Europe. As well as broadening the global reach of both firms, the merger will also mean the new entity will comprehensively cover all areas of the market including luxury, premium, volume, trucks and light commercial vehicles. PSA Group boss Carlos Tavares said: “This convergence brings significant value to all the stakeholders and opens a bright future for the combined entity. I’m pleased with the work already done with Mike and will be very happy to work with him to build a great company together.” FCA chief Mike Manley said: “I’m delighted by the opportunity to work with Carlos and his team on this potentially industry-changing combination. We have a long history of successful cooperation with Groupe PSA and I am convinced that together with our great people we can create a world class global mobility company.” FCA has already been in the news this year regarding mergers. It held extended talks with Group Renault over a possible partnership but those talks broke down after the two firms could not reach an agreement, thought to be hampered by Renault’s alliance with Nissan and the French government. Tavares led the purchase of Vauxhall-Opel and has been keen to expand the firm for some time, either through partnership or further acquisition. PSA is understood to have previously looked at buying Jaguar Land
Origin: BREAKING: PSA Group and Fiat Chrysler confirm merger plans
PSA Group and Fiat Chrysler confirm merger talks
Fiat Chrysler Automobiles is holding merger talks with the PSA Group that would create one of the world’s biggest car groups. The Financial Times has reported that the two firms have been in talks for several months over a merger. Both companies have now confirmed the talks. PSA issued a statement that said: “Following recent reports on a possible business combination between Groupe PSA and FCA Group, Groupe PSA confirms there are ongoing discussions aimed at creating one of the world’s leading automotive groups.” A similar statement from FCA read: “Following recent reports on a possible business combination between Groupe PSA and FCA Group, Fiat Chrysler Automobiles NV confirms there are ongoing discussions aimed at creating one of the world’s leading mobility groups. “FCA has nothing further to add at this time.” The potential merger would create a car giant worth around £40 billion and encompassing some of the world’s biggest car brands. FCA owns Fiat, Jeep, Alfa Romeo, Maserati, Ram, Lancia and Chrysler, while the PSA stable includes Peugeot, Citroën, DS and Vauxhall-Opel. FCA has been looking for a partner for some time, and earlier this year held extended talks with Group Renault over a possible partnership. But those talks broke down after the two firms could not reach an agreement. PSA boss Carlos Tavares led the purchase of Vauxhall-Opel and has been keen to expand the firm for some time, either through partnership or further acquisition. PSA is understood to have previously looked at buying Jaguar Land Rover, and has previously held talks with
Origin: PSA Group and Fiat Chrysler confirm merger talks
Toyota and Subaru confirm they’re co-developing a next-gen 86 and BRZ
2017 Toyota 86 Toyota and Subaru confirmed late September there will be a next generation of their jointly-developed sports cars, the 86 and BRZ.The fate of the vehicle was on shaky ground for a while, and we didnt know if it was going to survive for another iteration. Luckily, it will apparently be part of a massive expansion of the alliance between the two brands, which will include a whole bunch of new products.The 86 is expected to arrive sometime in 2021, though powertrain possibilities are still up in the air at this point. Its possible the vehicle could migrate to the Toyota New Global Architecture platform instead of the modified Subaru platform it currently rides on; this would mean the Boxer engine could be replaced by Toyotas turbocharged inline-four. Whatever they decide to do with the car, it will apparently be engineered to spark more joy to drive than the Supra at least, according to Toyotas lead engineer. (Or was that Marie Kondo?)Among the other projects the automakers will work on together are a Battery Electric Vehicle; a host of connected and autonomous vehicles; and an AWD vehicle that will apparently offer the ultimate sensation in all-wheel driving. (Celica GT4, anyone?)Toyota also announced it would investing more in Subaru, increasing its stake in the company from 16.83 per cent to 20 per cent. Subaru will acquire shares in Toyota of equal value to the money Toyota
Origin: Toyota and Subaru confirm they’re co-developing a next-gen 86 and BRZ
Toyota and Suzuki confirm details of new ‘Alliance’
Toyota and Suzuki have announced plans to acquire a financial stake in eachother’s operations, as part of a move towards a collaborative development programme. Toyota plans to take a 4.94% stake in Suzuki at a cost of £743,328,000 for 24,000,000 shares of common stock. Suzuki, meanwhile, will invest roughly £372,000,000 in Toyota. The deal is awaiting approval from the foreign competition authorities. The difference in investment amounts reflects Toyota’s inflated value; in 2018, the company became the first Japanese firm to achieve annual sales of 30 trillion yen (£232,340,271,000), while Suzuki achieved roughly a tenth of that, at 3,871.5 billion yen (£28,273,533,075). A statement from Toyota read: “The two companies intend to achieve sustainable growth, by overcoming new challenges surrounding the automobile sector by building and deepening cooperative relationships in new fields while continuing to be competitors, in addition to strengthening the technologies and products in which each company specializes and their existing business foundations. “Specifically, to take up challenges together in this transitional era, the two companies plan to establish and promote a long-term partnership between the two companies for promoting collaboration in new fields, including the field of autonomous driving.” In March, the two companies announced the first details of a new wide-ranging collaboration, which will involve Toyota producing Suzuki-badged hybrid vehicles based on the RAV4 and Corolla estate for the European market. The deal will include Suzuki vehicles being built at Toyota’s Derbyshire plant. The two Japanese firms signed a memorandum of understanding to develop a partnership in 2017, and have now agreed ‘concrete details’ of the deal. The two firms say the agreement will bring together “Toyota’s strength in electrification technologies and Suzuki’s strength in technologies for compact vehicles”. The agreement is also designed to help both firms “grow in new fields”, and will include joint collaboration in production and electrified vehicles. Toyota and Suzuki say they will “continue to fairly and freely compete against each other”. Both firms have given details on a number of specific projects in which they will collaborate, split into three strands. Toyota will supply its hybrid powertrain system to Suzuki at a global level, and will supply Suzuki with two new electrified vehicles based on the RAV4 and Corolla wagon for the European market. The two new models, both due on sale in late 2020, will be additions to Suzuki’s current range, rather than replacing any current model. The Corolla-based vehicle will be built at Toyota’s Burnaston plant in Derbyshire alongside the new Corolla, with production starting in late 2020. The hybrid powertrains will be made at the firm’s Deeside engine plant. The addition of the new model is not expected to add to the 3200 people employed across the two sites. Toyota has invested more than £2.75 billion in its UK operations, and the head of the firm’s UK manufacturing division, Marvin Cooke, said the move “demonstrates Toyota’s trust in the capability of our workforce to deliver the highler levels of superior quality products.” He added: “Seeking to produce additional volume for other manufacturers is one example of all the efforts we are making to keep our UK manufacturing operations as competitive as they can be.” Toyota will also adopt Suzuki’s newly developed compact vehicle engines in the European market. These engines will be manufactured at Toyota’s facility in Poland. Toyota said it was too early to determine which models would get the engines. The two firms will work to develop hybrid vehicles for the Indian market. Suzuki will also supply Toyota with two compact vehicles based on the Ciaz and Ertiga for the Indian market, and four vehicles in the African market. In addition, Toyota and Suzuki have agreed to collaborate on the development of a C-segment SUV for India, with Toyota taking on production of the Suzuki Vitara Brezza for that market. Toyota boss Akio Toyoda said: “We believe that the expansion of our business partnership with Suzuki – from the mutual supply of vehicles and powertrains to the domains of development and production – will help give us the competitive edge we need to survive this once-in-a-century period of profound transformation.” Suzuki boss Osamu Suzuki added: “We appreciate the kind offer from Toyota to let us make use of their hybrid
Origin: Toyota and Suzuki confirm details of new ‘Alliance’
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