Following talks earlier this year, it has been confirmed that automotive giants PSA Group and Fiat Chrysler are merging.
The move creates the fourth largest automotive firm, with nearly 9m models produced by the two firms each year with combined revenues of £144bn. A binding ‘Combination Agreement’ has now been signed, with the full merger expected to take place over the next 12-15 months.
In challenging times for automotive manufacturers when resources and budgets are being stretched, the merger aims to create greater synergies and shared investments on “vehicle platforms, engine families and new technologies”.
PSA Group owns well-known brands like Vauxhall, Opel, Citroen and DS, with the FCA Group having Fiat, Chrysler, Alfa Romeo and Jeep under its belt.
In a joint statement the companies said the group will be led by PSA Group CEO Carlos Tavares, with Fiat Chrysler’s John Elkann becoming chairman of the merged company, which is yet to be named.
Current FCA CEO Mike Manley will stay on at the new firm, though it’s not known what role he will take up.
The merger aims to create annual savings of more than £3bn, with Tavares being known for his cost-cutting – something that’s helped Vauxhall return to profit since being taken over by PSA in 2017.
No factories are set to be closed under the merger, with further details of the alliance expected to be announced later today.
