Fiat Chrysler Autos CEO Sergio Marchionne has been quite outspoken as of recent in saying automakers must merge and consolidate in order to remain profitable, and competitive, in the near future. He has sprung the idea on nearly anyone in earshot, including General Motors, but a new report from The New York Times has Marchionne reaching out specifically to GM CEO, Mary Barra.
The report states an email was sent to Barra in March, with Marchionne reaching out to meet on a possible FCA-GM merger, but Barra quickly rejected the idea with no interest.
Barra has already publicly gone on the record stating she will not entertain any ideas of a merger, saying it will distract from General Motors short- and long-term goals.
“We laid out a very comprehensive plan that takes us through the early next decade, with milestones next year and beyond,” The Detroit News quoted Barra as saying in April. “As we’ve communicated, we think there’s tremendous opportunity for us within the business as we look at efficiency measures, as we look at truly achieving the scale that we should have because we’re already in that top tier of the auto industry, among the largest OEMs.”
Although Barra did mention automakers may need to rely on one another, through collaborations, to develop the next greatest technologies, an absolute merger is not seen as a solution in her eyes.
The rumormill can keep churning all it wants, but it looks like this idea is dead-on-arrival.
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There is a simple cure for Sergio. Set up a rule in Outlook that any message from him or FCA goes straight to trash.
Good, FCA isn't worth a penny anyways especially since that turd sold off the only part of the company that actually makes a profit
If that did happen what would the Dodge/Ram boys do? Wet themselves...
Jeep is worth a lot.
I agree, Jeep is the only valuable brand that would be good for GM if they don't start expanding their off-road SUV lineup on their own.
Jeep is the juiciest and tastiest part of the FCA steak.
Unfortunately, everything else is gristle.
Well FCA is in trouble and Sergio is making a major mistake going public as his desperation is telling.
Fiat was in trouble and hoped the trucks and Jeep would help but the rest of the company was just more baggage as much of Fiat is. Development cost are through the roof and few companies can go it alone anymore.
Ford, GM. Daimler, VW and Toyota are the only real autonomous companies anymore. The rest either have a dance partner or they will have to have one. Even the big ones are working together when it works for both like GM and Ford or Toyota and BMW.
Even with Jeep and Ram joining forces with FCA is like tying a engine block to your leg and going swimming.
What is very worrisome is the lack of investment in R&D and the lag of getting new products to Chrysler. The LX platform needed replace a couple years ago and they still have never replaced the Neon as a legit small car.
The fact is GM could not remove jeep as it would be too expensive and they do not want the rest of the baggage. Besides if they want to do this segment they have GMC and the ability to make a better product as they are not going to be limited to a previewed style of vehicle. The good thing about jeep is they have a iconic look but the bad thing about jeep is they are stuck always having to have to make it look like a Jeep. It is the same issue Mini has had as they would like to expand but they are boxed in to a single look. The new Jeep with the odd looks has worked better than I expected with those non traditional buyers so they may have a opening they can take advantage of.
Ram trucks offer nothing GM wants or needs or that they could do themselves. The Chrysler car lines are of no interest or of anything they want or need.
Now if Sergio wants a date to the prom he need to look to VW and broker a deal. VW has banked their future on volume. This would add volume to their line and with models for the most part they do not already have. But I suspect Sergio has issues as VW will want a good deal as they know no one else wants them.
I never understood the FCA merger as I could not see either party being strong enough to help the other. Fiat has had money issues for years and Chrysler never did recover well after the bail out.
Since the bail out Chrysler has really only two new car models and a couple SUV and the trucks. They lack the new RWD and it will be a while before they see it. They still lack a good small car in the Sonic/ Festiva segment. The two new cars are based on old Fiat corporate platforms. The reviews have been better than what they had but not class leading.
Discounting cars and trucks are gaining sales but not long term customers as they only have a 24% repeat buyer rating. Quality issues are yet to be resolved and have delayed the Renegade.
I pray that they find a way out as I hate to see America lose any division let alone a automaker but as things are going I can see a break up of FCA and only Jeep and Ram surviving.
Now you know the truth of the Ram name change. They could sell the trucks or even sell them under a different MFG else where hence the name change.
Daimler took a damaged company and did not fix a damn thing. Sure they made some cool cars but they never focused on the smaller cars that are so important today. Fiat is a niche but not the only car to save FCA.
I have seen reports from investment people saying if things continue as they are FCA and Chrysler could be broken up or gone in 10 years.
Mary is earning her money not replying her.
She needs to go public and tell Sergio to bug off we do not need you.
Sergio gets too much love. The government gave him Chrysler and he has used NA ops as a cash cow to cover European losses and this silly dream of rebirthing Alfa.
Chrysler could be thriving right now had he made proper investment and sold Alfa and it's Turin capacity to VAG.
The consolidated Chrysler dealer's have real potential with a proper Chrysler line up of cars, soft suvs on the Chrysler brand side riding on Jeep underpinnings (like Buick and GMC) and with Dodge as a tiny niche sport division of three cars.
If GM were able to break FCA and sell European to VW, the deal might work after a decade of hard work much like Hyundai and Kia flood the market.
I still think GM should resist the urge to merge.
As much as I love Alfa, I have to agree. From an economic standpoint, FCA should have cut off Alfa and Lancia several years ago. Those brands only incur costs and no revenues. And Maserati and Ferrari should have been sold off to generate money. Money to fund development of modern car architectures to spun new C-, D- and E-segment models from Chrysler and Fiat.
And I am glad GM said no to FCA. GM struggles just as much in Europe as Fiat does. Two wrongs don't make a right.
"I pray that they find a way out as I hate to see America lose any division let alone a auto maker but as things are going I can see a break up of FCA and only Jeep and Ram surviving."
Are you old enough to remember when Boeing, MD and Lockheed were all producing wide body commercial aircraft in the US? Now it's only Boeing. The auto industry is comparable as development costs continue to increase, along with competition from the rise of automakers from other parts of the world.
I don't have a crystal ball but I say in 10-20 years at least one of the big 3 (or big 2.5 or whatever its called these days) may not be around. Unfortunately at this stage I say that could more than likely be FCA or even just its American half.
As for GM and FCA merging...how would that work? Both companies have made hard decisions to consolidate their US brands down to a few each over the years. Would a merged company keep all those brands, therefore bringing back the associated problems of having a diverse brand portfolio or would it be expected that more brands get culled?
You are very correct. This is not just an auto industry issue but many industries are seeing this.
GM might like getting some return on the 3.0 diesel the old GM paid to help develop, but the 2.8 makes it hard to justify buying it again.
There were quieter ways to do this. I would add Dodge to the Jeep column. But the bad outweighs the good.
Chrysler would add nothing to GM, nor would Fiat, Alfa, or SRT. GM has small cars pretty well down pat between GM Korea, Gamma II, and Spark EV. What they lack is budget performance and off-road... not worth the acquisition.
Frankly GM could crush FCA if it revived Pontiac as a sub-brand of Buick... and Hummer as a sub-brand of GMC. Which may be Barra's plan... if she were planning that, she certainly would be telling people the opposite (as she has).
GM is crushing Chrysler even with out any Pontiac brand and GMC does have a Jeep like competitor. The only questions is will they move forward with is as a GMC.
FCA has nothing and I mean nothing that GM would want outside the Wrangler and the price is not worth it.
I agree with you on Dodge. Durango Citadel and Charger, even at is age, at great. Fiat has even done a good job shaking off the damaged brand image of Chrysler.
Fca NA has great potential if only quality could be improved. Also, Chrysler brand needs a full segment line up. Giving Dodge a compact, Fca dub compacts and Chrysler brand midsized looks silly.
Marchionne seems desperate, Mary did good in rejecting this, fiats are known for being very unreliable.