Fiat-Chrysler CEO Says That He Wants To Partner With Volkswagen

In ablockbuster deal earlier this week, the French PSA Group decided to purchase Opel and Vauxhall from General Motors. It is rare that we see deals of this magnitude in the auto industry, and now other car companies are starting to spread rumors about mergers. In particular, rumors are surrounding FCA after CEO Sergio Marchionne claimed that his company could partner with Volkswagen Group.Detroit Newsreports that Marchionne islooking for a strategic partnerto consolidate the auto industry and codevelop technology with.

For this deal to happen, Volkswagen would likely have to buyout FCA as PSA did with Opel and Vauxhall. Both companies could benefit from this deal because FCA needs better R&D and a better reputation in Europe. Volkswagen, on the other hand, could benefit from FCA's presence in the US with trucks and SUVs. However, both brands have struggled recently with reliability claims, and FCA could even be dealing with a Dieselgatescandal of its own. FCA has desperately looked for a strategic partner to help it replace the Dodge Dart and Chrysler 200. FCA has been great at building trucks and 700 horsepower monsters, but a practical, affordable family sedan has still eluded the company.