Fiat Chrysler Automobiles CEO, Sergio Marchionne's merger plans with General Motors was shot down by the American car maker. This is not the first time Marchionne's merger plans was rejected as he had proposed a similar plan to Volkswagen also, which received the same fate.
According to New York Times, Mary Barra, chief executive of General Motors, received an email from Marchionne back in March. The email spoke about a potential blockbuster merger, which would help both automobile manufacturers to save billions of dollars in costs and create an automotive superpower. Unfortunately for Marchionne, neither Barra or other GM executives and board members were interested in the proposal. Therefore, Marchionne’s request for a meeting on the subject was turned down.
Marchionne being Marchionne, a month later at an analyst meeting, he again voiced the the same plan as he appealed to car makers to merge. “I think it is absolutely clear that the amount of capital waste that’s going on in this industry is something that certainly requires remedy,” he said. “A remedy in our view is through consolidation.”
No doubt Marchionne has had remarkable success in blending two struggling car companies into the world’s seventh-largest automaker. Fiat Chrysler’s sales in the United States have doubled since 2009, but it continues to have a minute presence in the world's two most thriving automobile markets -- China and India. Therefore, many may even take this merger plan as a sign of weakness.
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