Officially: the fourth largest auto concern in the world is formed

[[MC]Ronin[MC]]

Officially: the fourth largest auto concern in the world is formed

The deal to form the French-American alliance between PSA and FCA (50:50) is estimated at $ 50 billion.

 

 

Following the initial announcement on October 31, the merger deal with PSA Group and Fiat Chrysler Automobiles is a fact. The French-American alliance shares the rights equally (50:50), thus forming the fourth largest automotive concern in the world. With an estimated annual sales of around 8.7 million cars, the new association ranks after the VAG Group, Toyota Renault-Nissan-Mitsubishi.

The new alliance's expected revenue is EUR 170 billion annually, with an operating profit of more than EUR 11 billion and an operating profit margin of 6.6%. These figures are calculated on the basis of the results of 2018. One of the objectives of the merger is to reduce costs as a result of economies of scale and synergies, with savings of around EUR 3.7 billion here.

How will this happen? About 2/3 of the major models will be built on two platforms, with an estimated 3 million cars being built each year on each of these two small platforms.

As already known, 11 members (5 each from PSA and FCA) will be on the board, but Carlos Tavares, the current head of PSA Peugeot Citroen, will take over the next five years.

Earlier this month, Tavares said that no closure of any of the 13 brands was planned. The French hold Peugeot, Citroen, DS and Opel / Vauxhall, while the US-Italian partner owns Abarth, Alfa Romeo, Chrysler, Dodge, Fiat, Jeep, Lancia, Maserati and Ram. Two more brands need to be added here, namely Free2Move Shared Travel Service and Mopar Accessories Manufacturer.