Last night, we broke to you the news that a merger between Fiat Chrysler Automobiles (FCA) and PSA Groupe was approved by both parties and now both companies have released statements making it official. This morning, MoparInsiders.com obtained an e-mail sent out by FCA CEO Mike Manley, addressing the purposed merger to its employees…
I’m pleased to announce that we are taking steps towards a 50/50 merger with Groupe PSA aimed at creating a leading global mobility group – one with the scale, talent and resources to compete and win in a transforming industry.
The combination of our two businesses would create the 4th largest automotive group with potential annual sales of nearly 9 million vehicles and combined revenues of some €170 billion. It would unite the groups’ respective brand strengths across Luxury, Premium, Mainstream Passenger Car, SUV and Trucks & Light Commercial. And it would benefit from pooled capabilities in the in the key technologies that are reshaping the future of mobility.
By becoming one single group, we would be able to generate significant value, delivering approximately ($4.11 billion (3.7 billion euro)) in estimated annual run-rate synergies from investment efficiencies from sharing vehicle platforms, powertrains, technologies and enhanced purchasing power. These synergies are NOT based on closing plants.
Let me add that this proposed merger is about more than just numbers and synergies. We would be bringing together two companies with a shared vision, openness and trust in each other. On a personal note, my respect for and friendship with Groupe PSA’s CEO, Carlos Tavares, stretch back nearly a decade. I am inspired by the prospect of working together with him and all of you to build a great new company together.
Merging companies and cultures is something we know how to do well. FCA is a product of our ability to leverage each other’s backgrounds, embrace diversity and collectively drive for results.
The combination we envision with Groupe PSA will build on that success.
We hope to finalize our discussions and reach a Memorandum of Understanding in the coming weeks. Then it will take some time to agree on definitive documentation and complete the necessary consultations and shareholder approvals. In the meantime, it is vitally important that we continue to operate as a strong and independent company, delivering on our business plan and the results we have committed to.
In the very near future, I’ll be hosting a global town hall meeting where I will share more about the state of our business, the announced merger and my expectations for the rest of this year. I’ll look forward to taking as many of your questions as I can.
Thank you again for all your hard work and commitment.
It is still unclear what Manley’s new position with the purposed new company will be. It was announced that FCA Chairman John Elkann would continue to be Chairman of the newly formed company, while FSA Groupe CEO Carlos Tavares would take over the same position of the new organization.
There is no doubt that Manley will continue to be an important part of the new company, as he has had large success with both the growth of the Jeep® and Ram Truck brands in the past. Manley has held several roles within the FCA organization that have included Head of Jeep brand, Head of Ram brand and CEO for the APAC region. He was also the lead Chrysler Group executive for the international activities of Chrysler outside of NAFTA, where he was responsible for implementing the co-operation agreements for distribution of Chrysler Group products through Fiat’s international distribution network.
Prior to those roles, Mr. Manley was Executive Vice President – International Sales and Global Product Planning Operations. Appointed to this position in December 2008, he was responsible for product planning and all sales activities outside North America.