New automotive giant to build popular Jeep

NEW YORKFiat Chrysler (FCA) y Peugeot Citroen (PSA) modified the terms of their merger due to the commercial disruptions caused by COVID-19 and thus give way to the birth of the fourth largest automaker in the world and the third in sales.

FCA agreed to reduce the exceptional dividend to be distributed to its shareholders to $ 3.4 billion against the $ 6.5 billion promised earlier. PSA, meanwhile, will distribute 46% of its shareholding in the French auto parts manufacturer Faurecia among all the shareholders of the new company instead of only among its own shareholders as planned.

The decision was made “to take into account the impact that the COVID-19 health crisis has had on the automotive industry,” both companies said in a joint note. At the same time, it seeks to “preserve the original balance of the merger” that should be completed by the end of the first quarter of next year, the statement added.

The merger, which was announced at the end of October 2019, will lead to the creation of Stellantis; a company that will be the fourth largest in the world in the automotive sector in terms of production volume and the third in sales.

Many loyal consumers in the US to brands like Jeep and Chrysler will have the opportunity to continue to enjoy these vehicles with a redesign that will not discard the traditional lines that made them popular in North America, both companies announced.

The new giant will manufacture brands such as Peugeot, Citroen, Fiat, Chrysler, Jeep, Alfa Romeo and Maserati.

However, in recent months, questions have been looming about the balance of that union that had been announced as a marriage with common interests.

Due to the slowdown in trade caused by the pandemic, the two companies announced in May the waiver of the payment of an exceptional dividend of 1.3 billion dollars, which was planned as part of the merger.

SOURCE: AFP

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