Yesterday, Fiat Chrysler Automobiles made a surprising announcement that they want to have a merger with Renault. The Italian-American delivered a non-binding letter to the Board of Groupe Renault proposing a combination of their respective businesses as a 50/50 merger. FCA's goal for the merger is to share technology, intellectual property, and even plans to develop and manufacture vehicles with Renault.
And now, the French have replied.
Renault, in their official statement, have responded rather positively to the proposition. They even called the proposal a 'friendly' one. Europe's second-largest automaker says their board of directors have decided to study the feasibility of FCA's proposal, 50/50 merger, and all. There's even mention of the Alliance, which also includes Nissan, and Mitsubishi.
Should this deal push through, this will further cement the Alliance's lead in the global car market. That also means an extended product portfolio for them. Again, if the French agree to the 50/50 merger and FCA allows themselves to be part of the Alliance, the brands under their roof will include Renault, Nissan, Mitsubishi, Fiat, Alfa Romeo, Maserati, Chrysler, Dodge, Jeep, and Ram. Groupe Renault believes that this merger could further strengthen their manufacturing footprint worldwide.
As mentioned, Renault is Europe's second-largest automaker, Nissan is raking in most of the sales in the Alliance, and Mitsubishi is doing well in the Southeast Asia market. FCA, on the other hand, is actually Europe's third-largest automaker and last year was a good one for them. Revenue, operating income, net income, total assets, and total equity were all up in 2018, based on their financial report.