Peugeot and Vauxhall maker PSA has agreed plans for a merger with Fiat Chrysler that may create the world’s fourth largest carmaker.
PSA boss Carlos Tavares stated it will imply a “vibrant future” for the mixed firm although unions are already frightened about what a deal would imply for hundreds of employees at Vauxhall’s Ellesmere Port and Luton factories.
Nonetheless the businesses stated plans to make annual financial savings of €3.7bn (£3.2bn) by way of the deal have been “not primarily based on any plant closures”.
The announcement that the boards of the 2 firms had agreed to work in the direction of a 50/50 merger got here a day after they confirmed hypothesis that they have been in talks.
It will create an organization valued at nearly £40bn with mixed revenues of almost €170bn (£147bn) and working revenue of greater than €11bn (£9bn).
The businesses stated they might count on to make huge financial savings from a “extra environment friendly allocation of assets for large-scale investments in car platforms, powertrain and know-how” and from higher shopping for energy.
Mr Tavares, who will grow to be chief govt of the brand new mixed group, stated: “This convergence brings important worth to all of the stakeholders and opens a vibrant future for the mixed entity.”