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Stellantis mega-merger gets approval from FCA, PSA shareholders

MILAN — Shareholders of Fiat Chrysler and PSA Peugeot decisively voted Monday to merge the U.S.-Italian and French carmakers to create worldÂ’s 4th-largest auto company. Addressing separate meetings, both PSA Peugeot CEO Carlos Tavares and Fiat Chrysler Chairman John Elkann spoke of the “historic” importance of the vote, which combines legacy car companies that helped write the industrial histories of the United States, France and Italy. Before the merger is finalized, shares in the new company, to be called Stellantis, must the launched. It will be traded in Milan, New York and Paris. The marriage of PSA Peugeot and Fiat Chrysler Automobiles is built on the promise of cost-savings in the capital-hungry industry, but what remains to be seen is if it will be able to preserve jobs and heritage brands in a global market still suffering from the pandemic. The deal will create the worldÂ’s fourth-largest carmaker, with the capacity to produce 8.7 million cars a year, behind Volkswagen, Toyota and Renault-Nissan, and create 5 billion euros in annual synergies.  “We are fully aware of the fact that together we will be stronger than individually,'' PSA CEO Carlos Tavares told a virtual gathering of eligible shareholders. “The two companies are in good health. These two companies have strong positions in their markets.” The new company will put together under one roof French mass-market carmakers Peugeot and Citroen, top-selling Jeep and Italian luxury and sports brands Maserati and Alfa Romeo - pooling companies that have helped define the industry in the United States, France and Italy. While the tie-up is billed as a merger of equals, the power advantage goes to PSA, with Tavares running Stellantis and holding the tie-breaking vote on the 11-seat board. Tavares is set to take full control of the company early this year, possibly by the end of January. Fiat Chrysler chairman John Elkann, heir to the Fiat-founding Agnelli family and Fiat ChryslerÂ’s biggest shareholder, will be the Stellantis chairman. Fiat Chrysler CEO Mike Manley will head North American operations, which is key to Tavares' long-time goal of getting a U.S. foothold for the French carmaker he has run since 2014, and the clear money-maker for Fiat Chrysler. Such a deal was long wanted by Fiat ChryslerÂ’s long-time CEO Sergio Marchionne, who had predicted the necessity of consolidation in the industry. He was unable to find a deal before his sudden death in July 2018.

Mahindra vs. FCA case rages on amid confusion from false reports

The Mahindra vs. FCA case is trucking on despite some reports from India that say otherwise. It was widely reported over the weekend that Mahindra had come out on the winning side of the U.S. International Trade Commission's investigation. However, that's not the case, and FCA says it expects a final decision to be made this month. Apparently, the reports used a brief filed by Mahindra that doesn't actually have any bearing on what the final decision in court is. The briefing was rather explicit in its language, but FCA released a similar brief following hearings. We'll list them both for you below. Mahindra: "FCA is contractually barred from pursuing this investigation if Mahindra's vehicles contain or use the approved grille design. The evidence shows that Mahindra's Roxor uses the approved grille design. Thus, the record supports a finding that Mahindra met its burden of proving by a preponderance of the evidence that FCA is contractually barred from pursuing this investigation." FCA: "Mahindra has failed to carry its burden in showing that all of FCA's claims fall under the narrow scope of the 2009 Agreement. The Investigation against Respondents should therefore proceed." These statements represent opinions of both companies, but not actual decisions made by the U.S. ITC. In case you were still wondering, this whole battle is about the Mahindra Roxor's front grille design. FCA says is looks too much like a Jeep, and is worried the Roxor will cut into Wrangler sales. The Mahindra Roxor isn't road-legal, which would make it difficult to steal actual Jeep sales from FCA, and there was also an agreement signed in 2009 between the two companies related to this issue. FCA agreed then not to bring about infringement claims against Mahindra as long as it used a grille design that differs from the classic Jeep trademark grille FCA approved of. One could argue Mahindra's grille is different than Jeep's design because it only has five slats instead of seven, but it sure does look a lot like an old Willys. It will be another month before official word is out on this case, and we'll be following to see whether Mahindra will be allowed to sell its fun, diesel off-roader in the U.S. Related video:

Stellantis expects strike to cost it $795 million in third-quarter profits

MILAN — Automaker Stellantis said Tuesday that the autoworkers strike in North America is expected to cost the company around 750 million euros ($795 million) in profits — less than its North American competitors. The Europe-based maker of Jeep, Fiat and Peugeot reported a 7% boost in net revenues to 45.1 billion euros, with production halts caused by the strikes costing the company 3 billion euros in sales through October. The net revenue boost was due to higher volumes in all markets except Asia. Chief Financial Officer Natalie Knight told journalists that StellantisÂ’ strike impact was lower than the other Big Three automakers due to its global profile as well as some high-profile cost-cutting measures, calculating the hit at around 750 million euros ($795 million.) GM, the last carmaker to reach a deal to end the strike, reported an $800 million strike hit. Ford has put its impact at $1.3 billion. “We continue to be in a very strong position globally and in the U.S. This is an important market for us, and weÂ’re highly profitable and we are very committed to our future," Knight said. “But mitigation is core to how we act, and how we proceed.” Stellantis has canceled appearances at the CES technology show in Las Vegas next year as well as the LA Auto Show, due to the strike impact. Stellantis on Saturday reached a tentative agreement with the United Auto Workers Union to end a six-week strike by more than 14,000 workers at its assembly plants in Michigan and Ohio, and at parts warehouses across the nation. Stellantis does not report full earnings for the third quarter, instead providing shipments and revenues. It said that global sales of electric vehicles rose by 37% over a year earlier, powered by the Jeep Avenger and commercial vehicle sales. North America continued to be the revenue leader, contributing 21.5 billion euros, an increase of 2% over last year, and representing nearly half of global revenues. Europe, the next biggest performing region, saw revenues grow 5% to 14 billion euros, as sales rose 11%. Related video: Earnings/Financials UAW/Unions Alfa Romeo Chrysler Dodge Fiat Jeep Maserati RAM