Fiat Chrysler, PSA mega-merger faces EU antitrust probe

BRUSSELS: The mega-merger between Fiat Chrysler (FCA) and Peugeot Citroen (PSA) will undergo an exhaustive probe over concerns it will stifle competition, EU authorities said Wednesday.

The tie-up was announced at the end of October and originally scheduled to be finalised in early 2021 at the latest, in order to create the world's fourth-largest automaker.

The combined company would unite brands such as Peugeot, Citroen, Fiat, Chrysler, Jeep, Alfa Romeo and Maserati into one global giant.

The EU is concerned about the merger's effect on Europe's highly-profitable market for vans, which are technically easy to manufacture but sold at good prices.

"Fiat Chrysler and Peugeot SA, with their large portfolio of brands and models, have a strong position in commercial vans in many European countries," said Competition Commissioner Margrethe Vestager in a statement.

The commission will "ensure that a healthy competitive landscape remains for all the individuals and businesses relying on commercial vans for their activities," she added.

An initial investigation showed that the companies competed head to-head to sell vans in roughly half of the EU's 27 member states, the statement said.

The probe is to last at least 90 days and was widely expected after the companies dropped plans to have the EU's approval fast-tracked.

The launch of an in-depth investigation does not prejudge the final outcome of the European Commission's decision.

In a joint statement, the companies reaffirmed their goal to complete the tie-up by the end of the first quarter in 2021.