Fiat Chrysler and Groupe PSA, the maker of Peugeot and Citroen cars, announced Wednesday they were in merger talks that could propel them into the top ranks as the world's fourth largest automaker. The potential $50 billion tie-up, coming on the heels of a failed attempt earlier this year to combine Fiat Chrysler with Renault, could help both navigate a highly competitive global environment and a costly shift from traditional to electric cars.
Italian-US carmaker Fiat Chrysler Automobiles (FCA) said "there are ongoing discussions aimed at creating one of the world's leading mobility groups" with France's PSA. A similar statement from PSA offered no additional details. Both companies were holding board meetings Wednesday evening, sources said. A combined FCA-PSA would produce the scale needed in an industry facing slowing demand, with 8.7 million vehicles sold per year and 184 billion euros in annual sales. A person with knowledge of the matter told AFP on Tuesday that a merger - which is not guaranteed - would create a firm valued at about $50 billion.
PSA could gain access to the lucrative US market, while fulfilling the long-held goal of late ex-FCA head Sergio Marchionne for a merger to survive escalating costs and competition. The tie-up would make the new automaker the fourth largest in terms of sales behind Volkswagen, Renault-Nissan-Mitsubishi and Toyota, and would combine a host of well-known brands from Alfa Romeo, Jeep and Dodge to Citroen, Opel and Peugeot.
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