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Strains between France and Italy risk Renault-FCA merger

PARIS/ROME — Fiat Chrysler's proposed $35 billion merger with Renault has cheered investors, won conditional support from Paris and Rome and even earned cautious backing from trade unions. Beneath this veneer, however, the bold attempt to create the world's third-largest carmaker risks becoming rapidly embroiled in the fraught relationship between France's europhile President Emmanuel Macron and Italy's euroskeptic leaders. For while Deputy Prime Minister Matteo Salvini hailed the proposal as a "brilliant operation," Italy's creaking, state-subsidized Fiat factories are likely to bear the brunt of any production-related cost savings. FCA and Renault said this week that more than 5 billion euros ($5.6 billion) of annual savings would come mainly from combining platforms, consolidating powertrain and electrification investments and the benefits of increased scale. Salvini and France's Finance Minister Bruno Le Maire, who called the deal a "good opportunity" to build a European industrial champion able to compete with China and the United States, have both said they want guarantees on local jobs. "It's not every day that I agree with Salvini," said Le Maire, whose government appears to hold the trump cards. When it comes to where any job cuts fall, France will be helped by its existing 15 percent holding in Renault, whose superior efficiency at its five French plants makes it better placed to handle a supply glut, the demise of the petrol engine and the investments needed for electric and autonomous vehicles. "It will take many, many years to find real savings, and ugly political and operational realities can often swamp the potential of such new entities," Bernstein analyst Max Warburton said of the FCA-Renault plan to rival Japan's Toyota and Germany's Volkswagen. Advantage France? As well as Italy's government having to cope with the aftermath of European elections, which coincided with news of the FCA-Renault plans, political leaders in Rome were only informed shortly before the deal was made public, an FCA source said. This contrasted with the way the French government was treated, with Fiat Chrysler Chairman John Elkann, a fluent French speaker, letting it know of his merger proposal to Renault weeks ago, a French government official said.

Prius AWD-e, Subaru Forester and car museums | Autoblog Podcast #565

On the latest Autoblog Podcast, Editor-in-Chief Greg Migliore is joined by Green Editor John Snyder. They talk about driving the 2019 Toyota Prius AWD-e and the 2019 Subaru Forester. Then they discuss the weeks new, including conspiracy theories about Nissan and Carlos Ghosn, GM's EV plans and classic Ford Broncos for sale. The editors reminisce about their favorite automotive museums. They also help a reader choose a replacement for his Audi S4 in the "Spend My Money" segment.Autoblog Podcast #565 Get The Podcast iTunes – Subscribe to the Autoblog Podcast in iTunes RSS – Add the Autoblog Podcast feed to your RSS aggregator MP3 – Download the MP3 directly Rundown 2019 Toyota Prius AWD-e 2019 Subaru Forester Was Carlos Ghosn set up? Should General Motors be required to build EVs domestically? Al Oppenheiser to work on GM EVs Gateway Broncos Our favorite car museums Spend My Money Feedback Email – Podcast@Autoblog.com Review the show on iTunes Related Video:

Automakers drop support for Trump effort against California emissions

WASHINGTON — Toyota, Fiat Chrysler (now known as Stellantis following its merger with Peugeot) and other major automakers said on Tuesday they were joining General Motors in abandoning support for former President Donald Trump's effort to bar California from setting its own zero emission vehicle rules. The automakers, which also included Hyundai, Kia, Mitsubishi, Mazda and Subaru, said in a joint statement they were withdrawing from an ongoing legal challenge to California's emission-setting powers, "in a gesture of good faith and to find a constructive path forward" with President Joe Biden. The automakers, along with the National Automobile Dealers Association, said they were aligned "with the Biden administrationÂ’s goals to achieve year-over-year improvements in fuel economy standards." Nissan in December withdrew from the challenge after GM's decision in November shocked the industry and won praise from Biden. On Monday, the Justice Department asked the U.S. Appeals Court for the District of Columbia to put the California emissions litigation on hold to "ensure due respect for the prerogative of the executive branch to reconsider the policy decisions of a prior administration." Biden has directed agencies to quickly reconsider TrumpÂ’s 2019 decision to revoke CaliforniaÂ’s authority to set its own auto tailpipe emissions standards and require rising numbers of zero-emission vehicles, as well as Trump's national fuel economy rollback. Asked to respond to the automakers' action, White House climate adviser Gina McCarthy said in a statement that "after four years of putting us in reverse, it is time to restart and build a sustainable future, grow domestic manufacturing, and deliver clean cars for America." California Governor Gavin Newsom praised the automakers on Twitter for "dropping your climate-denying, air-polluting, Trump-era lawsuit against CA" and urged them to join the voluntary framework. TALKS WITH BIDEN Separately, an industry trade group on Tuesday proposed to start talks with Biden on revised fuel economy standards that would be higher than Trump-era standards but lower than ones set during the prior Democratic administration. The Trump administration in March finalized a rollback of U.S. Corporate Average Fuel Economy standards to require 1.5% annual increases in efficiency through 2026, well below the 5% yearly boosts under the Obama administration rules it discarded.