Boards approve merger to create the world's fourth largest automaker
October 31, 2019
The boards of Fiat and Peugeot will be merging after a decision was made by the two motor giants to create the world's fourth-largest automaker with combined revenues of 170 billion euros ($188.8 billion- R 2, 840, 118, 400,000.00), the companies announced today.
The 50-50 merger is expected to create synergies of 3.7 billion euros, a figure that the automakers expect to achieve without any factory closures - a concern of unions in both France and Italy where the carmakers have more model overlap.
Once the merger is finalised, Peugeot CEO Carlos Tavares will be chief executive of the new company with Fiat Chairman John Elkann taking the role of chairman.
The automakers said that the new company would be able to meet the challenges of powertrain electrification, connectivity and autonomous driving "with speed and capital efficiency."
The combined company will be able to share in the cost of developing those technologies with their "strong global R&D footprint," they said.
They will also save on investments in vehicle platforms and save money with greater purchasing power.
The merger decision comes about five months after a similar deal with French automaker Renault fell apart.