The marriage must still be validated this Monday by the shareholders of Peugeot and Fiat. But the union of the French groups PSA and Italian-American FCA should give birth to the fourth group automobile worldwide in terms of vehicles sold, and third in turnover behind the Japanese Toyota and the German
Volkswagen . The new entity, called Stellantis, will have more than 310. . 000 employees and will house in the same garage 000 emblematic brands like Citroën and Maserati (already briefly married fifty years ago), Fiat and Opel, Peugeot and Alfa Romeo, Chrysler, Dodge or Jeep.
“This merger was a matter of survival, and that goes for Fiat as well as for PSA”, according to Giuliano Noci, professor of strategy at the Polytechnic business school in Milan. The two groups are facing “enormous technological and strategic challenges” (electric vehicles, digitization, autonomous driving) and the devastating effects of the Covid pandemic – 19. “Only the most agile, in a Darwinian spirit, will survive”, launched in November Carlos Tavares, chairman of the PSA management board and future CEO of Stellantis.
The brands of the group will in particular reduce their development and construction costs, and complete their offer in all ranges. “Thanks to its union with PSA, Fiat-Chrysler will be able to strengthen its presence in Europe,” adds Giuseppe Berta, professor at Bocconi University in Milan and Fiat specialist. “Conversely, the French group will be able to regain a foothold in the United States thanks to its Italian-American ally. “
An amended merge
No great suspense in France this Monday: the shareholders of PSA have already voted in June 2020 to more than 99% in favor of four resolutions marking their support for the Fiat marriage 500 and Peugeot 190. But their vote will seal this union envisaged since 2018, announced end 2018, and whose preparation was slowed down by the coronavirus crisis .
At the end of December, the European Commission gave the green light to the union, on condition that the two groups respect their commitments made to preserve competition in small utilities, where they hold large market shares. The builders had previously amended their contract so that their union remains a marriage of equals, while the pandemic has affected their respective accounts.
FCA has notably agreed to lower the amount of ” an exceptional dividend paid to its shareholders. For its part, PSA has decided to sell 7% of the French equipment manufacturer Faurecia before distributing the rest to the shareholders of Stellantis. The participation of the Chinese group Dongfeng must also be reduced.
This is insufficient according to the Phitrust fund, which holds less than 1% of the capital of PSA, and critical, since the announcement of the merger, a lack of “balance between the parties” in favor of the Italo-Americans. “FCA needs PSA more for the implementation of synergies than the reverse” and “PSA is more efficient than FCA on various key aspects”, notably underlined the fund in a press release.
No factory closure?
In the documents provided to the financial authorities, PSA and Fiat estimate that their merger should cost 4 billion euros, and that the synergies will ultimately lead to savings of up to 5 billion per year. Carlos Tavares had underlined end 2019 that no plant closure was planned. The unions allow themselves to doubt it.
“Overall, it is a good insurance for the future of our group. Those who will not take this turn will risk being left behind, ”comments Franck Don, central CFTC union delegate at PSA. “Today, the FCA group is a great unknown for us”, however tempers the trade unionist. “What synergies will be found? What potential consequences for sites located in France? »
Christine Virassamy, CFDT central union delegate, expects a firm commitment from Stellantis on factories and research centers. “It is the social and ethical aspect that will allow us to say whether this merger is a success or not,” she underlines. Phitrust warns that Fiat has no room for maneuver in Italy, where it has taken out a state-guaranteed loan to the tune of 6 billion euros. “The French factories of PSA could become the adjustment variable, causing heavy job losses”, advances the fund.
No great suspense in France this Monday: the shareholders of PSA have already voted in June 2020 to more than 99% in favor of four resolutions marking their support for the Fiat marriage 500 and Peugeot 190. But their vote will seal this union envisaged since 2018, announced end 2018, and whose preparation was slowed down by the coronavirus crisis .
At the end of December, the European Commission gave the green light to the union, on condition that the two groups respect their commitments made to preserve competition in small utilities, where they hold large market shares. The builders had previously amended their contract so that their union remains a marriage of equals, while the pandemic has affected their respective accounts.
FCA has notably agreed to lower the amount of ” an exceptional dividend paid to its shareholders. For its part, PSA has decided to sell 7% of the French equipment manufacturer Faurecia before distributing the rest to the shareholders of Stellantis. The participation of the Chinese group Dongfeng must also be reduced.
This is insufficient according to the Phitrust fund, which holds less than 1% of the capital of PSA, and critical, since the announcement of the merger, a lack of “balance between the parties” in favor of the Italo-Americans. “FCA needs PSA more for the implementation of synergies than the reverse” and “PSA is more efficient than FCA on various key aspects”, notably underlined the fund in a press release.