Fiat Chrysler and Renault, two automakers looking to reduce the cost of producing vehicles and pooling resources to develop the next generation of vehicles, are planning a merger to become the world's third-largest automaker.
According to a statement from Fiat Chrysler Automobiles The combined company would be held 50% between the shareholders of FCA and Groupe Renault. A board of governors would hold the majority of independent directors.
The merger still needs approval from the boards of both automakers.
The joint organization would achieve an estimated sales of 8.7 million vehicles a year and would rank as the world's third largest automaker.
Fiat Chrylser said the combined company will make savings of € 5 billion ($ 5.6 billion) annually and "run as a merger transaction under a Dutch parent company".
Fiat Chrysler's press release added that there would be no plant closures as this was the result of the merger and should give the union the opportunity to lead the way in the development of electric and autonomous vehicles.
During the recent Fiat Chrysler earnings call, CEO Mike Manley was asked about the possibility of merging with another automaker, analysts said. "We are in an environment where opportunities will arise."
Fiat Chrysler's partnership with Renault is completely independent of the alliance Nissan-Renault-Mitsubishi.
For Renault, the partnership with FCA renews the speculation of the French The alliance of car manufacturers with the Japan-based Nissan may not last.
The two companies are involved, but this alliance has been strained since the arrest of Nissan-Renault CEO Carlos Ghosn at the end of last year. Ghosn was accused in Japan of committing financial crimes while serving as CEO of Nissan. This is vehemently denied by Ghosn and his lawyers.
Last year, Fiat Chrysler sold 4.85 million vehicles worldwide, with the vast majority sold in North America, where Jeep and RAM Trucks are two of the most popular brands. Meanwhile, Renault sold 3.81