What could have been the biggest merger in recent automotive history will be no more. Fiat Chrysler Automobiles (FCA) has made it official that they are no longer pursuing a merger with France's largest automaker, Renault. Just two weeks ago, the Italian-American car company surprised the industry with plans to merge with Renault, which the latter considered.
But now, the winds have changed. So what made FCA change their mind and do an about-face on their plans? Their answer lies in politics. In their statement, FCA said they withdrew their proposal due to the French government.
Their release said, 'It has become clear that the political conditions in France do not currently exist for such a combination to proceed successfully'. Talks about the merger were actually on-going, with FCA, Renault, and even Nissan holding discussions on the matter. Perhaps if it wasn't for France's political climate, the talks could have moved to the next level.
Perhaps another factor in the withdrawal is the fact that the French government has a bit of a say in whatever Renault does. It is possible that the government may have said something about the deal which led to its eventual withdrawal. But whatever the case is, the deal will not push through.
So what will the involved parties do now? FCA says they will continue with their independent strategy. It also doesn't look like FCA will be knocking on the doors of other automakers any time soon. Nissan and Mitsubishi on the other hand have yet to comment.