While the news of a potential suitor to merge with and potentially absorb the FCA name into a new company has been something that’s been asleep for a while, rumors of a new merger surfaced a few months ago in September. This rumor involved FCA being acquired by Hyundai and becoming the leading name with the brands that are currently part of FCA under the same umbrella. These rumors have become known to be just that, rumors, and have been quickly dispelled by the CEO of FCA, Sergio Marchionne as the news surfaced of this potential possibility.
What brought about the rumors that Hyundai would absorb the FCA brands and vehicles? Currently, the two companies share some parts and technologies which seems like it would be a simple and straightforward way to have the pairing become a merged company. It’s not been a secret that Marchionne wanted to find a company to merge with several months ago, but it seems his thoughts may have changed and instead of a full merger, he, and the rest of the FCA team, would prefer a strong partner that can help grow the brands that FCA has under its umbrella.
The Challenges Faced For FCA
While these two companies currently share some technologies, it seems plain to me that these don’t involve creating an affordable small car that can be sold in large quantities. Over the past few years, we’ve seen FCA delete the Dodge Dart, Dodge Grand Caravan, and Chrysler 200 from the market. At a time when the movement is toward small and active SUV models for the drive, this might seem like an intelligent change, but competing brands are developing their compact sedans and coupes to make them more attractive rather than deleting them from the lineup altogether.
In the past, when asked about the two sedans that were discontinued, Marchionne stated the company needed a strong partner that could build these cars in order to make them financially feasible. FCA has been mired by financial struggles that have lasted longer than their direct competition, which has kept them from being able to develop more models for us to enjoy. The interest in Hyundai could be expanded when it comes to the development of more transmissions and hydrogen power for the drive, which could signify these items being added to some of the small SUVs that are being offered by the FIAT Chrysler America brands.
Right now, Marchionne is working on a new business plan that will take the company to 2022 to help guide the company into the future which he won’t be part of. His time with the company is scheduled to end in April 2019 and the goal is to present this new plant in the second quarter of next year to have time to implement it and make things easier for the next CEO of FCA. This gives us something new to look forward to from his office while we dispel the rumors that FCA was to merge with Hyundai.