Fiat Chrysler said to be in talks to forge ties with Renault

Jeep vehicles are parked outside Fiat Chrysler’s Jefferson North Assembly Plant in Detroit. (AP pic)

MILAN: Fiat Chrysler Automobiles NV is considering a tie-up with Renault SA, which could eventually lead them to becoming part of the Renault-Nissan Motor Co. alliance, according to people familiar with the matter.

FCA is talking to Renault about a partnership and could reach a preliminary agreement in the coming weeks, according to the people, who declined to be identified because the discussions aren’t public. Talks could still collapse, especially amid the tensions between existing partners Renault and Nissan, the people said.

Renault’s partnership with Nissan was thrust into the spotlight in November with the arrest of Carlos Ghosn, the chairman, and architect of the global car-making alliance that also includes Mitsubishi Motors Corp. The arrest also triggered speculation that Renault was seeking to merge with Nissan, a move the Japanese company resisted.

FCA also held initial talks with PSA Group, the owner of French carmaker Peugeot, as it evaluates potential partners, the people said. Chairman John Elkann and Chief Executive Officer Mike Manley have made several trips to Paris since the beginning of the year for business meetings as part of their search for ways to make the carmaker stronger, the people said.

With sales falling in the world’s biggest car markets – China, US, and Europe – automakers are under intense pressure to combine efforts and investments as they develop expensive new technology such as self-driving cars and electric engines.

FCA declined to comment, while Renault didn’t immediately respond to a query sent after regular business hours. PSA is open to “opportunities that would create value on a long-term basis,” but based on 2018’s financial results, “there is no hurry to finalize any partnership,” according to an email statement.

The Financial Times reported on the talks earlier Saturday.