It is the business of the summer… The group Fiat-Chrysler would be on the verge of being acquired by a chinese automaker ! This information disclosed by the website, american specialty Automotive News is still the state of rumor, especially after the denials of the main chinese groups, such as DongFeng or Geely already owns Volvo. But there are still some groups that are not yet expressed.
A global group
This is not a trivial matter since whoever grabs FCA, expands significantly in Europe, the United States, with brands well-established as a Chrysler, Dodge, Jeep or RAM, but also in Latin America where the brand Fiat owns more than 20% of the brazilian market. For a chinese automobile manufacturer (no not really yet acquired a world-scale) the change in size would just be decisive with 4,5 million registrations in the group. More importantly, it chamboulerait the hierarchy of the landscape of the global automotive industry, currently dominated by Volkswagen, Toyota, General Motors or Renault-Nissan-Mitsubishi.
But no one is yet out of the wood… The latest rumors in date, give Great Wall Motors (which has confirmed its interest, but without having made a firm offer), the leading manufacturer of SUVS in China with its brand Haval, of the attempts on the only brand Jeep, the first provider of group volumes an Italian-american. Other analysts believe to know as GAC, the sixth chinese automobile manufacturer with less than 2.5 million cars, would have manifested his interest for nearly a year now.
Also read: Which is the Great Wall, the small manufacturer auto chinese who see (too) large?
Sergio Marchionne, boss of FCA, has never hidden his intention to find a partner. After having been rejected by General Motors, but also by Carlos Ghosn, boss of Renault-Nissan Alliance, according to some… The Italian, however, has never given up on finding an industrial partner, and all options remain open : the sale by apartment, until the sale of the entire package. Two years ago, he brought Ferrari on the stock Exchange, and he is always looking to give the automotive supplier, Magneti-Marelli. A time, the Volkswagen group lorgnait Alfa Romeo, but this would not be news.
Chrysler and Fiat, two marks adrift ?
Because all brands of FCA are not as shiny as one might think. Thus, Jeep and Alfa Romeo (read our analysis) have a offensive product ambitious and of good quality that result in sales strong increase, by contrast, Chrysler, which breaks the teeth in the United States and Fiat get caught up in his inability to get out of his strategy mono-product around the Fiat 500.
Read also: Fiat-Chrysler can take a dieselgate ?
But the buyer will find a group totally cleaned by Sergio Marchionne. FCA is a group recipient, reduced debt, and most importantly, who is awash in cash with almost $ 25 billion of cash. In other words, while the rumors add value to the group $ 20 billion, the pleased buyer would have his money, because he would immediately in cash, and may at leisure giving up a few family jewels as Dodge, RAM, or even Chrysler, and why not Fiat…
The markets are applauding the idea
The markets, themselves, are very enthusiastic at the idea of a redemption of the FCA, including a chinese group. They see a very good eye for a consolidation of the sector, and the fact that a chinese group enters the dance could push the mastodons historical in their entrenchments, or to compel the manufacturers the means to react (Hyundai-Kia, PSA, etc.). The action FCA is rising since the rumors. This morning, she had a new fever rising to 4% after the intentions have been lent to Great Wall Motors.
Sergio Marchionne who must leave the group a year from now, will absolutely lead to his project of sale of the company. No question to the selling out of the group. But nickels are the accounts of the company, the buyer knows that he will find a number of brands to relaunch, which will require significant investment, Chrysler and Fiat in the lead. Besides investment in new technologies in which FCA has taken of late, particularly in the electrification. The redemption of the FCA, may not therefore be a financial opportunity, he enrolled in an industrial project is ambitious, and necessarily expensive.
This leaves many unanswered questions on the scenario of a buyout of FCA. A chinese group has the means to cover these costs ? Does he have the industry experience to get out of the FCA of this lack of security technology ? A western group will he react to bar the way to the Chinese, left to bid ? Donald Trump will there be a pan to its auto industry, a topic that is dear to them, to return to the Chinese ? The sale of FCA could in reality become a soap opera with multiple plot twists and great surprises, to the extent of the enormous challenges that the operation is…