Fiat Chrysler, Maserati Reynaud, Reynaud discussed on NPR's Business Story of the Day
Support for this podcast and the following message come from American pest as the leading provider of safe, sustainable pest control solutions across the DMV. Let American past help you to take back your home or business from menacing pests visit them today at American pest dot net. Fiat Chrysler is proposing a merger with the French automaker Renault, Reynaud says it's considering it, this merger would be a big deal. It would create the world's third biggest car company after Toyota and Volkswagen. Here's NPR's Camilo domino, sqi, a merger this big would be striking, but not totally surprising. Fiat Chrysler has been looking for a partner for a while. And there, there are limited partners available. Michelle crabs is an analyst with auto trader and Cox automotive. She says, meanwhile, the French Renault had a long standing alliance with the Japanese automaker Nissan that was working. Well, and then things went awry, when former CEO Carlos gone was arrest. Sted in Japan for alleged financial misdeeds and things have just been unraveling now both fiancee's and Reynaud are eyeing their options when it comes to who though partner with as they prepare for big changes in the industry. Many major, automakers have already been partnering up over the last couple of years. There are two reasons first after years of record growth. The auto industry is starting to slow down and that decline is expected to continue. Meaning fewer car sales less revenue at the same time, automakers need to be making big investments in the future things like electric vehicles and self driving cars, and it's a tough one, because you're investing in something that isn't profitable today isn't going to be full tomorrow, but might be profitable might be essential in ten years time. Mark Wakefield is an automotive consultant at Alex, partner's upstart companies like tesla and even ride hailing services like Uber and lift. They're bringing new competition. In response established carmakers are closing ranks towards each other to be able to share costs and to be able to invest through this like on. That's really what's driving a lot of these merger discussions in partnership discussions to Reynaud has been making electric vehicles for years, while Fiat Chrysler, has been lagging behind its decided to focus on money-making brands like Jeep, and ram, big pickups, and SUV's. Plus, it has premium brands like Maserati Reynaud is pushing smaller low cost vehicles Fiat Chrysler thrives in the Americas. Particularly in the United States. Reynaud doesn't sell cars in North America at all. But it's a major player in Europe and Russia that also like a pretty good fit. One has small cars in the other big trucks, one offers luxury vehicles. The other goes down market, but they feel have problem which is trying to Felipe Munoz is an analyst at auto researcher Jada. Dynamics. He says, neither company has a foothold in the crucial Chinese market. Then there are the practical problems of merging and not in another culture. I know the more factories that's more people to teach to work together, which Fiat Chrysler, has to do already since the merger that made it back in two thousand fourteen Blyleven cries which are Italians on American that way only but he's not an easy thing. And it would be even harder if you try to preserve the French Renos alliance with Nissan of Japan, another complication Reynaud is part owned by the French government and has strong unions. The want to preserve local jobs, Fiat Chrysler says the deal if it happens would not result in any plant closures. Camilo dominancy, NPR news.