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4 ways FCA-PSA merger could be a plus

DETROIT — In a merger deal announced overnight, Fiat Chrysler stands to gain electric vehicle technology while PSA Peugeot Citroen could benefit from a badly needed dealership network to reach its goal of selling vehicles in the U.S. The merger would create the world's fourth-largest automaker with a combined market value of around $50 billion. Neither company would comment. Experts say the two automakers will be able to share car, SUV and commercial vehicle designs, helping each other fill weaknesses and share costs that will make them a strong global player. "We view the combination of these two companies as reasonable given global competition, high capital intensity, and industry disruption from electrified powertrain as well as autonomous technologies," Morningstar analyst Richard Hilgert wrote in a note to investors. Here are four areas that could be crucial to the two automakers' success: Technology For years, Fiat Chrysler has lagged its rivals in electric vehicle technology, with its former CEO once trying to discourage people from buying its only fully electric car in the United States, the Fiat 500E, because he lost money on each sale. The company has made progress on gas-electric hybrids and may have plans for more fully electric vehicles, but PSA has valuable technology that FCA can use, said Navigant Research analyst Sam Abuelsamid. Peugeot was relatively late to the electric vehicle game but is now working fast to catch up, notably with fellow French rival Renault. CEO Carlos Tavares has made a point of stressing the company's need to adapt to changing technology at car shows and earnings calls. Last year he announced plans to offer 40 electric models across its lineup by 2025. "Electrification hasn't been a huge part of their play up until now," Abuelsamid said. "Between the two of them, I think they could generate some scale for whatever they're doing, sharing component costs, development costs across electrical platforms," he said. More electric vehicles also would help FCA meet pollution and fuel economy regulations in Europe. As far as autonomous vehicles, neither company is among the leaders, Abuelsamid said. But that's a technology that's years into the future, giving them time to share the huge expenses and catch up together. FCA also has alliances with other companies such as Google spinoff Waymo that could bring autonomous vehicle technology to the market when ready, Abuelsamid said.

Fiat board makes Chrysler merger official, approves $5.4B bond sale

Fiat's board of directors has officially approved the merger plan that will see the conglomerate's automotive operations merged with Chrysler into the new Fiat Chrysler Automobiles.
The plan essentially provides a road map for the structure of the new company. It includes provisions for Fiat shareholders - one Fiat share will translate to one share of FCA common stock. The new company will also include a loyalty voting structure, which will provide for shareholders of Fiat stock or those that have held FCA stock for at least three years. According to the plan, these shareholders would see their voting power double, with two votes for every share of FCA's common stock. The overall merger plan still needs to be approved by the company's shareholders.
In other Fiat-related news, the company's board has announced a bond issuance of four billion euro ($5.4 billion). The new bonds should provide the company with a degree of flexibility in refinancing debts associated with the merger plan.

2017 Fiat 124 Spider First Drive

If you've been following the protracted birth of this car, you probably know the basics: The 2017 Fiat 124 Spider is a Mazda MX-5 in an Italian-designed suit. It's built in Japan, and it was engineered by Mazda but sports a Fiat engine – shared bones, different philosophies. A quick Miata aside: When we found out the latest MX-5 had less power than the NC-generation car that came before it, what got shouted down was the fact that it's significantly lighter, and it's also a damn riot to drive. It doesn't need more power, and we reaffirm this belief every time we get in one. I did just that, driving one to the airport to catch a flight to San Diego this week. With the MX-5's charms freshly in mind, I drove the 124 Spider in both basic Classica and posh Lusso trims on-road, ­and briefly sampled the sportier Abarth version at a long autocross-style cone course. What I really wanted to know is how much Fiat character found its way into the latest evolution of the Japanese interpretation of the classic European roadster. Whereas the MX-5 is stretched drum-tight over its hardpoints, the 124 Spider has an extended nose and tail; since the wheelbase is unchanged, this manifests in larger overhangs. To be generous, this body stretch increases the trunk space slightly and improves cooling to the turbocharged engine, which faces more significant heat-management challenges than Mazda's 2.0-liter. It also gave Fiat's designers some room to incorporate scallops for the LED-equipped headlights that recall the sealed beams on the original Fiat 124 Spider from 1966, those iconic twin power bulges on the hood, and an angular grille. Whether you consider the 124 to be attractive on its own, in comparison to the MX-5, or an appropriate homage to the original car is entirely subjective, but I'll weigh in with mixed feelings. Sharing a platform has its challenges, and recall that Fiat came into this development process late. This was supposed to be an Alfa Romeo, remember? How that affected the design process isn't clear, and no one would cop to it, but it seems that the Fiat-ization of the MX-5 didn't happen at a leisurely pace, nor on Fiat's terms. I think it's less handsome than the MX-5 in general, but in certain colors (and in the Abarth trim) it's a looker. The front end is especially handsome, and the character line that kicks up at the door handle adds some real interest to the profile.