AutoBeta(AutoBeta.net)12/22 Report--

The merger of Fiat Chrysler and Peugeot Citroen is imminent. After completing the monopoly investigation, the European Commission approved the merger of the two major automakers on the 21st, Xinhua reported.

Previously, the EU feared that the combined new company would affect the lucrative van market in Europe. As a result, the European Commission said in a statement that the conditions for approving the merger were that the two carmakers fully abide by their commitments.

The commitment is that Citroen promised to continue to implement the agreement with Toyota Motor Company of Japan after the merger to continue to produce and sell Toyota-branded vans in the European market. In addition, Fiat Chrysler and Peugeot Citroen agreed to open their van repair and maintenance networks to competitors after the merger.

Fiat Chrysler and Peugeot Citroen issued statements welcoming the European Commission's green light to the merger and announcing that the two companies are scheduled to hold separate shareholders' meetings in early January to approve the merger, which is expected to be completed by the end of the first quarter.

The merger of the two big carmakers is largely certain that the new company, which will be fully merged by Fiat Chrysler and Peugeot Citroen at a 50:50 share ratio, will be called the "Stellantis" group and will become the world's fourth-largest carmaker by sales, with Carlos Tavares as chief executive.

As early as December 18, 2019, Fiat Chrysler and Peugeot Citroen formally signed a binding joint agreement designed to facilitate the merger of the two groups, in which the two carmakers each hold a 50% stake.

In terms of sales, the combined group will sell 8.7 million new cars a year, ranking fourth in the global auto industry, behind Germany's Volkswagen Group, Toyota and Renault-Nissan-Mitsubishi Alliance. In terms of operating income, the combined new group will have annual revenue of about 170 billion euros, ranking third in the global automotive industry.

According to the plan, the merger of the two groups will have ultra-luxury, luxury, mainstream passenger car brands, as well as complementary products and brand combinations such as pick-up trucks and light commercial vehicles, which will give the new group a balanced and profitable global layout. The new group will own Peugeot, Citroen, DS, Opel, Vauxhall, Alfa Romeo, Chrysler, Dodge, Fiat, Jeep, Lancia, Maserati, RAM and SRT.

The advantages of the merger are cost savings related to technology, products and platforms, as well as slowing demand and rising electrified costs in the global automotive market. The new group will optimize investment and share large-scale use of vehicle platforms, engine series and new technologies. In the agreement, it is expected that the annual sales of more than 2max 3 of the new group will come from two platforms, namely, small platforms and compact / medium platforms. About 3 million vehicles will be sold each year.

Of course, for Chinese consumers, the merger of the two automakers will be more critical to how the Chinese market will adjust, after all, Peugeot Citroen and Fiat Chrysler have been underperforming in the Chinese market.

With the intensification of competition and centralized transformation in the global automobile market, many automobile companies have formed alliances one after another. In June this year, Volkswagen Group and Ford Motor Company officially announced an alliance to develop pickups, commercial vehicles and electric vehicles. Fiat Chrysler and Peugeot Citroen became the latest carmakers to "huddle together for warmth".

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