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Stellantis is official: FCA and PSA merger finally sealed

MILAN — Fiat Chrysler and PSA sealed their long-awaited merger on Saturday to create Stellantis, the world's fourth-largest auto group with deep enough pockets to fund the shift to electric driving and take on bigger rivals Toyota and Volkswagen. It took over a year for the Italian-American and French automakers to finalize the $52 billion deal, during which the global economy was upended by the COVID-19 pandemic. They first announced plans to merge in October 2019, to create a group with annual sales of around 8.1 million vehicles. "The merger between Peugeot S.A. and Fiat Chrysler Automobiles N.V. that will lead the path to the creation of Stellantis N.V. became effective today," the two automakers said in a statement. Shares in Stellantis, which will be headed by current PSA Chief Executive Carlos Tavares, will start trading in Milan and Paris on Monday, and in New York on Tuesday. Now analysts and investors are turning their focus to how Tavares plans to address the huge challenges facing the group – from excess production capacity to a woeful performance in China. Tavares will hold his first press conference as Stellantis CEO on Tuesday, after ringing NYSE's bell with Chairman John Elkann. FCA and PSA have said Stellantis can cut annual costs by over 5 billion euros ($6.1 billion) without plant closures, and investors will be keen for more details on how it will do this. Marco Santino, a partner at consultants Oliver Wyman, said he expected Tavares to disclose the outlines of his action plan soon, but without divulging too many details at first. "He has proven to be the kind of person who prefers action to words, so I don't think he will make loud statements or try to over-sell targets," he said. Like all global automakers, Stellantis needs to invest billions in the years ahead to transform its vehicle range for the electric era. But other pressing tasks loom, including reviving the group's lagging fortunes in China, rationalizing its huge global empire and addressing massive overcapacity. "It will be a step by step process, also to allow the market to better appreciate every single move. I don't think we will have all the details before one year," Santino said.

Stellantis sees vehicle loan durations extended amid banking turmoil

Stellantis is seeing clients seeking longer-term financing and leasing deals for their vehicles as a consequence of higher global interest rates, the carmaker's head for the business said. Chief Affiliates Officer Philippe de Rovira said loans which normally had a three-year maturity were now increasingly moved to four years. "This allows customers to get a car for a monthly instalment that is similar to that they had before," he said. The world's third largest carmaker by sales on Tuesday announced it had completed a plan announced in late 2021 to reshuffle and simplify its leasing and financing operations in Europe. Under its terms, Stellantis created a 50-50 single long term multi-brand leasing company named Leasys with Credit Agricole Consumer Finance. It also set up local joint ventures in European countries for its new Stellantis Financial Services unit, formerly Banque PSA Finance, with BNP Paribas Personal Finance and Santander Consumer Finance. "These banks have always had better funding conditions than those we can have as an automaker," de Rovira said. Benefits of the plan included cutting the number of financing and leasing entities the group runs in each country and the number of IT systems it uses, with expected savings exceeding 30% in this particular area, he added. De Rovira said the group had a huge portfolio of orders it had not yet delivered due to supply chain shortages impacting production. "Demand is not our main issue. The issue is to deliver as fast as we can cars that are in our order portfolio, which is still at record levels," he said. The group aims to expand its corporate leased vehicle fleet to more than one million units in 2026 and to double net income from its so-called banking activities to 5.8 billion euros ($6.3 billion) by 2030. De Rovira said Stellantis was not seeing a downward trend in vehicle pricing. "Probably the significant price increases we have seen in 2021 and 2022 will not be repeated because the context is changing, but for the moment we don't see decreases, we see stabilisation". ($1 = 0.9188 euros) (Reporting by Giulio Piovaccari and Gilles Guillaume; Editing by Jan Harvey) Earnings/Financials Plants/Manufacturing Alfa Romeo Chrysler Dodge Jeep RAM

Dear Ram: 'GT' doesn't belong on a pickup

When word of the forthcoming Ram G/T models hit our inboxes on Tuesday, my first reaction was one of confusion. The notion of a "Grand Touring" package for anything with a pickup bed struck me as entirely foreign and left me feeling conflicted. Have pickup trucks really come so far that a GT-inspired model makes sense, or am I just married to an antiquated notion that has been co-opted and subsequently bled to death by the endlessly churning automotive marketing machine? One could reasonably argue that "GT" has come a long way from the days when it was closely associated with its namesake term (whether you say "Gran Turismo" or "Grand Touring" really makes no difference) and plenty of not-so-sporting automobiles have already borrowed the nomenclature to denote trims with faster-looking body kits or larger wheels. If that's the model we're choosing to acknowledge, Ram's is arguably ahead of the game. Its G/T package adds a cat-back exhaust and cold air intake (more of a performance nod than some other "GT" models enjoy), paddle shifters, a console-mounted gear lever, unique bucket seats with high bolsters and metal covers for the gas and brake pedals. If this were a package for a Dodge Charger or Challenger, it would certainly check the right boxes. Heck, the whole thing was essentially parts-binned from the TRX with an assist from Mopar's factory accessory catalog.  A Ford Mustang GT and a Mercedes-AMG GT. Note how similar they are to a half-ton truck. In my quest to decide just how out-of-touch I am, I first asked Ram whether G/T actually stands for anything. It doesn't. It was chosen simply to "signify a sporty model within the lineup." There's no apparent significance to the slash aside from being an obvious nod to Dodge's R/T (Road/Track) models, of which even the Viper was one. Even with SRT having supplanted R/T atop the Mopar performance heap, the latter still denotes models with a significant performance increase.  But that means G/T is precisely what we think it is — a trim meant to impart notions of performance, even if there's little of it to be found. It doesn't quite sit with me. The domestics have already pretty much forced us to accept the notion of both high-performance and luxury-oriented pickups, so something splitting the difference doesn't really seem that outrageous.