Shareholders of both companies overwhelmingly approved the merger Monday, carmakers said.
Following the completion of the merger, the combined company will become the world’s fourth largest automaker, said Jeff Schuster, an analyst at LMC Automotive. Together, the companies are estimated to be worth $ 57 billion.
While Fiat Chrysler and PSA compete in Europe, PSA is virtually non-existent in the US, where Fiat Chrysler is the fourth largest carmaker in terms of sales in the country. However, both companies have struggled to compete in the fast-growing car market in China, Schuster said. The merger will not help right away, he said, so it will remain a challenge for the new company.
Although the two companies in Europe do compete with each other, their brands have somewhat different positions in the market, Schuster said.
‘And I think there’s a [electric vehicle] expertise PSA has that FCA does not have, ‘he said,’ so there is a nice synergy there. ‘
The founding of the new company will help release resources as it moves toward electric and autonomous vehicle technologies, said Michelle Krebs, an analyst at Cox Automotive.
“The creation of Stellantis is merely a great example of an underlying trend we are currently seeing in the automotive industry, as all serious automakers face the monumental task of reforming their operations with a view to 2030, when EVs and autonomous technology will have shifted from appearance to mainstream, ‘she said.
Shares of Stellantis launches on Monday, January 18 at the stock markets in Paris and Milan and the following day on the New York Stock Exchange.
The merger requires some final approvals of regulations, according to the companies, including those of the European Union and the European Central Bank.