Volkswagen Confirms Readiness to merger talks to Fiat Chrysler

volkswagen-confirms-readiness-to-merger-talks-to-fiat-chryslerVolkswagen Group opened the door to a merger with rival Fiat Chrysler Automobiles, thereby setting the stage for a seismic shakeup in the global automotive industry.

Matthias Mueller, Volkswagen global CEO told reporters in Germany that he would not forbid talks with Fiat Chrysler, the Italian-American automaker, according to Reuters.

His comments came after an annual press conference, indicating a possible speedup in consolidation for an industry that is experiencing an edge of mayhem via self-driving vehicles and ride-hailing applications.

Mueller confirmed reporters “I am not ruling out a conversation,”, according to Reuters. He informed that he had not yet spoken with Fiat Chrysler CEO Sergio Marchionne regarding this topic and said “it would be convenient if Mr. Marchionne communicated his considerations to me as well and not only to you.”

Marchionne has lobbied publicly for auto industry consolidation and in this regards has previously proposed a deal with General Motors and was swiftly rejected by GM.

But now urgency is picking up as GM is ready to sell its European division to French automaker PSA Group that controls the Peugeot brand, thereby translating into stiffer competition for VW in its home market.

In the U.S., Fiat Chrysler has its popular and profitable Jeep and Ram brands, but is burdened with ailing car-heavy brands Dodge, Chrysler and Fiat.

Fiat Chrysler is one of the smaller automakers globally and may need to navigate in technological investment heavily to keep with the industry shifts taking a turn to self-driving vehicles and electric cars.

But that does not indicate a deal makes sense for Volkswagen, said Autotrader analyst Michelle Krebs.

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