Hyundai and FCA may have a future together

Article by Christian A., on September 24, 2017

It has been two years since Fiat Chrysler Automobiles started courting suitors for a potential buyout. Naturally, two Chinese automakers namely Guangzhou Automobile Group and Great Wall Motor Company have shown interest in this. However, there is another candidate for the potential takeover, and it is none other than Hyundai.

It was The Detroit Bureau who said that Hyundai has shown interest to buyout FCA. This rumour came out last August just after FCA had a meeting with the Chinese automakers. But even after the South Korean automaker expressed their interest, China’s Dongfeng Motor Corp. And Zhejiang Geely are still in the picture.

According to an analyst in charge of automobiles at Eugene Investment & Securities, Lee Jae-il, if a Hyundai-FCA merger actually pushes through in the near future, that will make the South Korean marque the largest automaker in the world, even leaping over Toyota, VW, and Nissan combined for a total of 11.5 million units sold last year. That is not all for Hyundai. This merger will also benefit the South Korean automaker due to an expanded portfolio and high consumer awareness of FCA brands in the United States and Europe. Furthermore, the acquisition will not just increase sales, but it will also help Hyundai fill in its hole in their lineup with SUVs and trucks.

Jae-il also said that it has been suggested for Great Wall Motors to acquire Jeep and that this is a possible move by the Chinese, but again, Hyundai Motor is also a possible buyer.

With all the rumours circulating, Hyundai continues to keep quiet regarding this matter. In fact, they are denying the rumours that they are working together with FCA. More than that, Sergio Marchionne, CEO of FCA denied all the news as well saying that neither the Chinese nor the South Korean automakers have offered to merge with them, during the Italian Formula One Grand Prix. Instead, Marchionne talked about how he will be putting his focus on executing the company’s business plan for 2018. The company’s share price actually hiked up after the reports of interest for the group.

FCA is currently the seventh largest automaker in the industry, and in the world - with over 225,000 employees across four different regions where they operate. Last year alone, the company was able to earn a revenue of €111.018 billion ($132 billion), that is equivalent to a profit of €1.814 billion ($2.17 billion).

This is not the first time we have heard rumours like this between the parties involved, and if this is true, we’re unsure why the automakers are denying them. The recent rumours have gone through lengthy articles in the South Korean press and speculation by analysts in Seoul.

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Topics: hyundai, fca, partnership

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