French automakers PSA and Italian-American Fiat-Chrysler announced Wednesday that they have signed a merger agreement to “form the world’s fourth-largest automaker.” The two automakers signed “a binding agreement binding with a view to a merger between equals of their activities, to form the fourth largest automobile manufacturer in the world,” said a joint press release from PSA and Fiat-Chrysler, relayed by the French media.
With more than 400,000 employees, the new entity will post a consolidated turnover of nearly 170 billion euros and annual sales of 8.7 million vehicles, it said.
“The completion of the merger should take place within 12 to 15 months,” said the two groups. This alliance will allow “savings linked to technologies, products and platforms” which “should represent around 40%” of the 3.7 billion euros in synergies. These savings should allow the new entity to “invest massively in the technologies and services that will shape the mobility of the future, while meeting the challenge of regulations on CO2 emissions,” the statement said.
The two manufacturers announced on October 31 that they had unanimously agreed on the principle of a merger, where the shareholders of the two groups would share the capital 50/50, after various financial transactions, to form a new global automobile giant, without factory closure.