FCA, Renault talks have "ratcheted up"


Fiat Chrysler wants to improve the quality of its cars.

Eric D Lawrence, Detroit Free Press

Fiat Chrysler Automobiles and French car manufacturer Renault are in talks that can result in a context of their operations.

On Saturday, the Wall Street Journal reported that the discussions involve a "widespread relationship that may involve a large part of their businesses."

FCA is slowing down.

A source familiar with the conversation confirmed them to Free Press and indicated that they had "ratcheted up" recently.

The journal noted that the FCA is worth $ 20 billion and Renault $ 17 billion, suggesting that a deal could come soon, but that the talks could also fall apart. Renault has been involved in a partnership with Nissan and Mitsubishi, but the drama involving concerns and accusations of financial crimes against former leader Carlos Ghosn has left his future uncertainty. Ghosn has denied wrongdoing.

It is unclear how an event with Renault would affect US operations, including those in Detroit, where the FCA is planning a huge expansion to restore the Jefferson North Assembly and turn the idle Mack Engine complex into a SUV assembly facility. More: Fiat Chrysler Merger Speculation Excites – But What's New?

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More: Morouns, speculators look like winners in Detroit swap to secure FCA factory jobs

FCA has For a long time has been the subject of speculation for a potential merger or acquisition, and the company has partnerships with companies including Waymo linked to autonomous vehicles.

FCA CEO Mike Manley has said the company can stand alone, but that he is open to arrangements that would strengthen it.

Prior to the increased Renault negotiations, the PSA Group had been the subject of many reports of a possible relationship. Manley's predecessor, the late Sergio Marchionne, had made an industrial consolidation case in 2015 with his "Confessions of a Capital Junkie."

Car manufacturers are facing a challenging time as they acquire resources to develop electric and autonomous driving technology while the US market is in a post-peak period. The shift from small cars in the US to SUVs and trucks and a down market in China has also had consequences.

Contact Eric D. Lawrence: Follow him on Twitter: @_ericdlawrence.

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