The talks of merger have progressed in recent days and could lead to an announcement regarding a partnership or merger as soon as possible.
Fiat Chrysler Automobiles N.V. and French automobile manufacturer Renault are reportedly in advanced discussions to merge the two automakers. According to the reliable sources, the talks of merger have progressed in recent days and could lead to an announcement regarding a partnership or merger as soon as possible.
Reportedly, the CEOs of Renault and Fiat Chrysler have made it clear that both the automakers are open to partnerships with other automakers which will give them the economies of scale for further cost cutting both in terms of manufacturing and developing vehicles. The move could be particularly helpful in Europe where overall auto sales are under pressure.
Mike Manley, CEO, Fiat Chrysler, reportedly noted during most recent earnings call of Fiat Chrysler that the company has made it clear in past that it wants to be active and proactive to develop the business and improve the value for shareholders. The company is entering an environment where there are going to be opportunities, he further added.
In the meantime, under Renault’s former CEO Carlos Ghosn, the company was increasingly interested in a full merger with Nissan which is its collaborator in an alliance that has delivered mixed results. In late 1990s, when both the automakers first formed their partnership, the combination had helped Nissan to cut the losses and eventually become a highly profitable automaker. In recent days, there is growing tension between Renault and Nissan since the arrest and detention of Ghosn late last year. Ghosn has been charged with several crimes by Japanese authorities relating to his tenure as the CEO of Nissan-Renault alliance.
Reportedly, the automakers will be helped by the partnership between Renault and Fiat Chrysler to pool resources for the development of autonomous and electric vehicles. The EV program of Renault is more advanced than Fiat Chrysler’s, but neither of them is considered a leader in electric vehicles.