FCA-PSA merger confirmed
'Stellantis' destined to become the world's fourth largest carmaker from January 16th
By Matt Bird / Tuesday, January 5, 2021
Even in more conventional times, the amalgamation of Fiat Chrysler Automobiles and PSA would obviously be significant; with the world as it is, the merger looks like being one of the year's biggest automotive news stories. And it's January 5th.
The two companies have both confirmed shareholder approval of the union, with more than 99 per cent in favour of the move, and report that the process should be complete on January 16th. It's also been reported that "merger related matters" have been finalised as well, including Articles of Association and a Board of Directors. Meaning that 'Stellantis' – the name chosen for the new group – should be in existence as of next Saturday. Shares are to begin trading on the Euronext in Paris and on Mercato Telematico Azionario in Milan on Monday, January 18th, and on the New York Stock Exchange on Tuesday, January 19th. Barring any last minute changes – which are hard to envisage now – the FCA-PSA supergroup is a matter of days away.
Which leads to a rather inevitable question: which of the brands involved will survive the merger? Because Stellantis represents a huge a portfolio of manufacturers, with everything from Abarth to Jeep and Maserati to Vauxhall. There are some that appear safe from any additional reorganisation – Jeep, Peugeot and Fiat are the three bestsellers – but others might struggle to justify their place in the line-up. With the industry's inexorable push towards automation and electrification, plus Stellantis's meagre presence in China, it's easy to see how now could be the ideal time to make cuts in the name of greater efficiency.
Already reports are suggesting that Chrysler could face the chop, given it sells only two uncompetitive cars – the 300C and the Voyager/Pacifica MPV – in fairly modest numbers. It could be argued that Lancia's prospects don't look particularly bright, either, given its sole offering – the Ypsilon supermini – has only been sold in its home country since 2017. That said, it was Italy's second-best selling car in 2019, with almost 60,000 delivered, so perhaps its future isn't quite so clear cut.
Elsewhere, it's been noted that Dodge could face difficulties, marketing as it does a lot of high performance heavyweights in the US – a country which seems destined to pursue more ambitious environmental targets under a new president. Let's not forget Vauxhall, either; rejuvenated somewhat through the use of PSA platforms and powertrains – as, presumably, much of the smaller FCA offerings will also be – but arguably on shaky ground given Opel also exists in the empire. Can the UK-only offshoot still be justified?
In the build-up to the merger, both operations reiterated that no factories closures would occur – but overcapacity was a festering issue before the tie-up. It seems almost inconceivable now that either wing of the sprawling conglomerate will remain untouched. An ongoing requirement for platform consolidation in an electrified era and the implied cost savings of duplication mean that something will have to give. And given the way Carlos Tavares – currently PSA boss, and set to head up Stellantis – tends to operate, it could be sooner than anticipated. More news as we have it.
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