By on March 14, 2017

porsche-ceo-matthias-muller

Matthias Müller, CEO of Volkswagen Group, said in a press conference he hasn’t excluded the possibility of a merger with Fiat Chrysler Automotive.

Müller said, “There has been no at this point between (CEO of FCA) Mr. Marchionne and me, but I have never said I would exclude it.”

“In my opinion, size does not matter. I have always said volume is not our sole goal. We want to be a successful manufacturer in every way.”

Müller said this in response to Marchionne’s merger claim at the Geneva Motor Show. The FCA big wig said VW would take the hardest toll from GM’s sale of Opel to PSA Group, and would then want a new partner.

sergio-marchionne

“It would be very helpful if Mr. Marchionne were to communicate his considerations to me too, and not just to you,” the likely frustrated Müller told reporters at the conference.

Marchionne “has no doubt” VW will at least be interested in talking to FCA for a potential partnership, but Müller is not as convinced as the FCA boss seems to believe.

“I am pretty confident about the future of Volkswagen, with or without Marchionne,” Müller said, likely hurting Marchionne’s feelings.

This is not Marchionne’s first merger proposal. He was promptly shut down after he called on Mary Barra to hug it out with various, erm, intensities.

[Source: , ]

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56 Comments on “Müller: ‘Size Does Not Matter,’ VW Not Counting Out FCA Friendship...”


  • avatar
    sirwired

    So, could we call this the Island of Lost Toys strategy?

  • avatar

    This is the merger that makes the most sense to me.

    • 0 avatar
      mike978

      Why, VW doesn’t need FCA. FCA is very dependent on RAM and Jeep. VW would junk Fiat, Dodge and Chrysler and maybe Alfa Romeo.

      • 0 avatar

        Completely disagree. VW is weak In North America. No trucks. RAM would take care of that. Barely any C/SUV’s. Jeep would take care of that globally as well. VW has lusted after Alfa Romeo, if you will recall.

      • 0 avatar
        RobertRyan

        @mike978
        No Alfa Romeo would be good for VW, but then again, they have a slew of performance type brands. RAM/ Jeep leave as is as they are primarily NA brands

  • avatar
    dal20402

    Marchionne: “I’m so lonely.”

    Mueller: “I’ll buy Jeep off you for $10.31 and a bag of baseballs, but you have to beat it after closing.”

  • avatar
    Garrett

    FCVWA just rolls off the tongue…

  • avatar
    ect

    The last thing VW needs is another set of brands to manage. They have trouble differentiating their current portfolio.

  • avatar
    Big Al from Oz

    It’s hard to envisage FCA and VAG as one.

    I could see VAG having a greater interest in an Asian manufacturer. This is where I think Renault has done well with Nissan.

    FCA only has Jeep and Ram to offer. Even these two brands need lots more resourcing to keep them relevant.

    PSA will not have the resources to manage a FCA buyout, most energy will be used amalgamating Opel and Vauxhall.

    This leaves Toyota and Renault/Nissan with the means to invest money and restructure FCA.

    Toyota would not even consider FCA.

    I would think Renault/Nissan as the most viable to buy out FCA in the future.

    • 0 avatar
      th009

      Volkswagen and Suzuki were a good fit from market and product point of view. The management and personality fit was, err, not quite so good.

      • 0 avatar

        That’s because Osamu Suzuki is not right in the head according to some people I’ve spoken with.

        • 0 avatar
          bumpy ii

          IIRC, his son was being groomed to take over the company, but he died so the old man had to come back to run things again. Something of a 1940s Henry Ford situation.

      • 0 avatar
        Big Al from Oz

        th009,
        VAG could buy Mazda if it were for sale and take Suzuki at the same time.

        The Japanese manufacturers will rationalise more sooner or latter.

        Nissan-Mitsubishi, Toyota-Subaru? Mazda-Izuzu-Honda?

        I mentioned the other day, Japanese manufacturers of soley (mainly) cars don’t tend to do as well in the global market.

        • 0 avatar
          mike978

          Mazda doesn’t need to merge. They are profitable, having globally increasing sales and are mean by selling the same vehicles globally rather than spending money to have to adapt to each market (European Civic vs US Civic for example).

          • 0 avatar
            RobertRyan

            @mike978
            Very True, they going to partner with Isuzu, after divorcing Ford to do their next Pickup

    • 0 avatar
      Speed3

      I think a Honda-FCA tie-up would make the most sense. FCA’s weakness are reliability, fuel economy, and producing solid sedans – all things Honda does well.

      FCA is successful in segments and markets Honda does not compete.

      Of course, Honda is completely happy doing its own thing and would never touch FCA.

      Probably only a Chinese firm would actually take the bait.

  • avatar
    GermanReliabilityMyth

    Dieselgate debacle aside, I still see VW as easily being the power top and FCA, at this point, is submissive enough to be the bottom. This “friendship with benefits” is a real possibility.

  • avatar
    threeer

    Don’t call us…we’ll call you…

  • avatar
    Middle-Aged Miata Man

    What’s the German translation of “shit sandwich?” Because this would be that.

  • avatar
    Lou_BC

    “size doesn’t matter”
    That comment coming from a company that wanted to be the world’s number one in sales volume?
    Dieselgate equals Teutonic neutering on an epic scale.

    • 0 avatar
      OldManPants

      “Dieselgate equals Teutonic neutering on an epic scale.”

      Schwanzvernichtung!

      This is gonna start a war of revenge!

    • 0 avatar
      RobertRyan

      @Lou_BC
      Despite the ” Gate” have passed Toyota to hit No.1 Spoke to a German engineer two months ago, who said VW is pushing Skoda a lot now, a default” VW” but different enough not to be associated with the car line.

  • avatar
    Vulpine

    I would question the term ‘merger’ and replace it with the word ‘partnership’, personally. Sharing tech and components can definitely save money but at the same time the brands need to maintain an individual identity. GM’s collection of brands became so inbred that they ended up killing off three brands that carried extremely loyal followings simply because they were all too much like other GM brands.

  • avatar
    MLS

    It’s Fiat Chrysler Automobiles, not Automotive.

  • avatar
    el scotto

    Any FCA mergers have to be considered from a global viewpoint. Fiat sucks in NA and Ram has no where to go but NA. The lust after Alfa’s should make them do ok and Maseratis are still lust after machines. Ferrari has been separated from Fiat (I think). Sergio is a a placeholder until Agnelli’s grandson takes over FCA or sells it or mergers it. The Agnellis still control FCA through their holding company that is family controlled. Sergio is their drink fetcher and place holder until the Agnellis decide what to do or are forced to do. The Piechs buying out the Agnellis? What used to be an impossibility has crept into the realm of possible.

  • avatar
    Jeff S

    There has been some talks of the Swedes buying back Volvo. If that were to occur then maybe they could buy Jeep and possibly Ram and merger it with Volvo or if they bought all of FCA they could sell Fiat and Alfa Romeo and close Dodge and Chrysler. Volvo has some experience with large trucks and a pickup and off road and suvs vehicles would give them a product line that is booming and also a larger dealer network in the US and Canada. Swedish corporations in the past have bought out a number of US Companies such as Frigidaire, White trucks, Gant clothing, Weed Eater, Roper, and a host of other brands.

    • 0 avatar
      RobertRyan

      @Jeff S
      Volvo Trucks would buyback Volvo cars, but would not touch RAM or Jeep. Still not have heard any buyback rumours.
      Only other one was investors wanting to buyback Scania from VW, but they are now involved with MAN taking over Navistar.

  • avatar
    Jeff S

    @RobertRyan–Jeep and Ram both have a lot of potential and Volvo Trucks has the expertise and experience to improve the quality and both would fit well with Volvo cars and crossovers. Robert you are looking only at what Chrysler and FCA has done with both and not the potential that a Ram truck or Jeep would bring if they were better managed and the quality improved. The potential would not only be in North America but both could be marketed in Europe and China with better success than FCA. The Jeep name still has a lot of value and Ram would give Volvo more of a presence in North America. Also Volvo could partner with another manufacturer to produce a Global pickup whereas FCA would find it much harder to partner with any other manufacturer. FCA has soiled the Jeep and Ram name but that doesn’t mean that both brands don’t have potential and at a discounted price it might be worth buying. FCA will not sell both at the present but if they continue on their decline they might not exist in the near future.

    • 0 avatar
      RobertRyan

      @Jeff S
      They are mainly NA products, Volvo( cars) and Volvo( trucks) looking at a more global product.. Volvo cars have mentioned they might do a Pickup after 2020.
      Your somber assessment Jeff, unfortunately maybe on the money.

  • avatar
    Caboose

    Assume that VAG does buy FCA. How far would that take them toward their goal of 800k annual North American sales?

  • avatar
    Conslaw

    Volkswagen should by the German INA ball bearings company. They could be VAG-INA. Has a ring to it, doesn’t it?

  • avatar
    raph

    I wonder if this would be another “merger of equals” if it were to go down? I’m not sure German management is compatible with any other on the planet.

  • avatar
    Jeff S

    @RobertRyan–It is a shame but I don’t see very much hope for FCA. Sergio has tried to merge FCA with GM and other corporations but FCA doesn’t have much left that would add to a merger. GM themselves has been shedding unprofitable divisions. Ram would have value to an automotive company that doesn’t have an existing truck and then it would have to be at fire sale prices to motivate a purchase. Jeep is the most valuable part of FCA but again that would be a fire sale. The only way I see Jeep and/or Ram surviving is a fire sale of FCA with Dodge and Chrysler being killed off with Fiat and Alfa Romeo being sold off to a German or French automotive company and even they might not have any takers thus they would be shut down. GM still has a chance to survive and they too could be merged with another company. It would not surprise me in the future if Ford is the only remaining US based corporation.

    • 0 avatar
      RobertRyan

      @Jeff S
      Even Ford would need a partner to survive.Hard to say what will happen. FCA merge with Hyundai? In NA?
      Actual FIat Trucks industrial agriculture , ( IVECO, Case etc) need to be paired with someone. What about BMW and Honda? Just too many If’s
      Outside NA RAM is put in the Car/ SUV category.


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