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Renault Looking to Merge With Nissan, Then Acquire FCA?

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Recent weeks have seen rumours pop up regarding a possible partnership between PSA (Peugeot Société Anonyme) and the FCA Group (Fiat Chrysler Automobiles). New speculation now advances the possibility that Renault is interested in the automotive group – but with a significant first step to come before that could happen.

That first step would be a merger between the French company and Nissan.

Yes, Renault and Nissan are already tied together in a partnership as part of the Nissan-Renault Alliance, along with Mitsubishi. But the key word is alliance. Prior to his arrest, Alliance boss Carlos Ghosn had tried to cement the partnership and effectively make for a full merger. There was resistance to this from Nissan, particularly from its CEO Hiroto Saikawa. The view from Nissan HQ has long been that the Alliance brought greater benefits to Renault than to the Japanese automaker.

Now, the French manufacturer is apparently looking to restart merger talks, with the hope that it could happen within the next 12 months. Thereafter, the plan would be for the newly-created giant to make a bid for FCA. All of this comes as reported by the Financial Times.

Photo: Renault

If this plan does get implemented to its conclusion, Renault, Nissan and FCA (and let’s not forget Mitsubishi) will constitute one of the world’s biggest automotive groups, alongside Toyota and Volkswagen.

Unsurprisingly, no official word has been forthcoming from any of the parties involved confirming any of this. French authorities are saying only that the current focus is on a possible full marriage between Renault and Nissan.

It may be a while before we have anything more concrete than what comes out of the rumour mill.
But seen from the “where there’s smoke” perspective, clearly there are serious discussions going in in several boardrooms. The Wall Street Journal is reporting, for one, that FCA has rejected the overtures made by the PSA Group. In any event it’s fairly obvious that FCA is listening to suitors.

To survive in the automotive industry of the next decade and beyond, companies know that scaling-up is the only strategy. It’s inevitable that we’ll see other partnerships and mergers in the coming years.

Stay tuned.