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Fiat Chrysler Confirms Negotiations With PSA For A Possible Merger


10/30/2019


Fiat Chrysler Confirms Negotiations With PSA For A Possible Merger
Discussions about a possible partnership between Peugeot, Vauxhall owner PSA and car giant Fiat Chrysler is currently ongoing. This news of a possible tie up was recently confirmed by Fiat Chrysler. 
 
The talks were also confirmed by PSA, which operates UK Vauxhall factories at Ellesmere Port and Luton, and said that the negotiations were "aimed at creating one of the world's leading automotive groups".
 
This developed follows on the heels of Fiat Chrysler opting out of an earlier attempted merger with another France-based car maker, Renault, earlier this year.
 
A mew company that would be valued at more than $50bn would be created by the merger between the US-Italian company and PSA.
 
The confirmation of the news about the ongoing talks between the companies saw the share price of Fiat Chrysler rising sharply. There was a 5 per cent increase in the price of shares of PSA in early trading on Wednesday after the negotiations were confirmed by the companies.
 
The global auto industry is currently undergoing a phase of consolidation and partnerships between large companies as the auto companies struggle to cope with a slowdown in the global economy while also having to put in huge amounts as investments in the development of technologies and production facilities for electric cars and self driving vehicles. Auto companies are also string to negotiate ever stricter environment and emission regulations all across the world. 
 
The merger if completed would create an entity that would bring together brands such as Fiat, Chrysler, Alfa Romeo, Dodge, Jeep and Maserati together with PSA's Peugeot, Citroen, Vauxhall and Opel.
 
However the deal could also mean further uncertainties for Vauxhall workers because the UK business of from America's General Motors was bought over by PSA two years ago along with Germany's Opel brand.
 
Earlier this year, PSA said that it planned to make the next generation of its Astra model at Ellesmere Port, where it employs 1,000 people working solely on the Astra, but that its investment depended on the terms of the UK's departure from the EU.
 
Since the takeover, the company has already cut hundreds of jobs at the factory. 
 
Global pressures weighing on the industry has already squeezed the auto companies of the United Kingdom. Japanese auto major Honda has pulled out of Swindon while US’s Ford has closed down its engine plant at Bridgend. Earlier this year, announcement of terminating thousands of jobs from its global workforce was made by Jaguar Land Rover.
 
(Source:www.skynews.com)