Fiat Chrysler has delivered a non-binding letter to Renault to propose a combination of the respective businesses as a 50/50 merger.
The Fiat Chrysler proposal follows initial operational discussions between the two companies to identify products and geographies where they could collaborate, particularly as they develop and commercialise new technologies.
The discussions made clear that broader collaboration through a combination would substantially improve capital efficiency and the speed of product development.
The case for the merger is also strengthened by the need to take bold decisions to capture at scale the opportunities created by the transformation of the automotive industry in areas such as connectivity, electrification, and autonomous driving.
The proposed combination would create a global automaker, preeminent in terms of revenue, volumes, profitability and technology, benefiting the companies’ respective shareholders and stakeholders.
The benefits of the proposed transaction are not predicated on plant closures, but would be achieved through more capital investment in common global vehicle platforms, architectures, powertrains, and technologies.