Fiat Chrysler and Groupe PSA announce intention to merge
Two of Europe’s leading car manufacturers have announced their intention to merge in a deal that could see the creation of the 4th largest car manufacturer in the world.
Fiat Chrysler, owner of automotive giants including Fiat, Alfa Romeo, Chrysler, Abarth and Jeep has announced its intention to merge with Groupe PSA. French company PSA is responsible for the manufacture of some of Europe’s best-known brands including Peugeot, Citroen and Opel/Vauxhall.
A joint statement from the two companies said the Boards of both have ‘each unanimously agreed to work towards a full combination of their respective businesses by way of a 50/50 merger.’
The two companies have agreed to finalise discussions on the deal and are working towards signing a binding Memorandum of Understanding in the coming weeks.
The proposed merger of the two has raised concerns about jobs losses in the UK.
Groupe PSA employs 3,000 people in the United Kingdom, as part of its manufacturing business. Over 1,000 of these are employed at the Ellesmere Port plant in Cheshire in the North West of England.
In June of this year, PSA announced that Rüsselsheim in Germany had been chosen as one of two European locations for the manufacture of its next generation Vauxhall/Opel Astra.
Making the announcement the company said that it was planning for operations to continue at the Ellesmere Plant and for it to be second home for the next generation production of the Astra. However, in a stark warning to the UK it said finalising this plan would be dependent on the Brexit deal agreed between the UK and the EU.
In a statement issued at the time, the company said, ‘The decision on the allocation to the Ellesmere Port plant will be conditional on the final terms of the UK’s exit from the European Union and the acceptance of the New Vehicle Agreement, which has been negotiated with the Unite Trade Union.’
Meanwhile, responding to news of the intended merger, Unite, the trade union representing those working in the automotive industry in the UK said it was seeking an urgent meeting with PSA.
Unite National Officer, Denis Quinn said, ‘Unite is seeking an urgent high -level meeting with PSA over merger talks with Fiat Chrysler.
Merger talks combined with Brexit uncertainty is deeply unsettling for Vauxhall’s UK workforce which is one of the most efficient in Europe.’
He said, ‘The fact remains, merger or not, if PSA wants to use a great British brand like Vauxhall to sell cars and vans in the UK, then it has to make them here in the UK.’
(Image by Leeroy Agency via pixabay.com)