Fiat Chrysler Automobiles N.V. (FCA) and Peugeot S.A. (PSA) on Wednesday reached a binding agreement on a merger that would create the fourth-largest global automotive manufacturer by volume and the third-largest by revenue.
The two carmakers made the announcement in a joint statement.
The statement said the proposed combination will be an industry leader with the management, capabilities, resources, and scale to successfully capitalize on the opportunities presented by the new era in sustainable mobility.
Based on 2018 results for each of the two merging partners, the new company would have the capacity to sell an estimated 8.7 million vehicles a year with revenue of nearly 170 billion euros.
This, they said about 46 per cent would be derived from the European market and 43 per cent from North America.
The PSA Chairman, Carlos Tavares, said the merger was a huge opportunity to take a stronger position in the auto industry as the duo seek to master the transition to a world of clean, safe and sustainable mobility.
Tavares added that the merger was also to provide customers with world-class products, technology, and services.
“This is a union of two companies with incredible brands and a skilled and dedicated workforce. Both have faced the toughest of times and have emerged as agile, smart, formidable competitors,” the FCA CEO, Mike Manley added.
FCA was founded in 2014 as a result of a merger between historic Italian carmaker Fiat and American automaker Chrysler.
The statement said FCA employs nearly 200,000 people around the globe, while PSA employs 210,000 people.