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Chinese GAC to buy majority of FCA?

by Bill Cawthon on

China’s Guangzhou Automobile Group may be looking for a majority stake in Fiat Chrysler Automobiles, according to an unsourced report in Italian newspaper Il Giornale that was picked up by Reuters. FCA stock rose slightly on the report.

china

Guangzhou, FCA’s joint venture partner in China, has been making the Fiat Viaggio version of the Dodge Dart since 2012, and is now making Jeeps for sale in China. GAC is also going to be showing its own cars at the New York Auto Show next year.

Guangzhou, the sixth largest Chinese automaker, also has partnerships with Honda, Mitsubishi, and Toyota. They likely have the finances to buy a majority of FCA, whose stock is now valued at under $9 billion (according to Bloomberg). It would take years to control FCA, due to a loyalty clause and special shares held by Exor, the Agnelli family holding company.

There have been many rumors about takeovers of FCA, as well as selloffs by Exor. Most have had no basis in reality, though long-standing rumors of an attempted merge with General Motors turned out to be correct.

Update: This rumor has been denied by GAC.

Bill Cawthon grew up in the auto industry in the 1950s. His Dad worked for Chrysler and Bill spent a number of Saturdays down on the plant floor at Dodge Main in Hamtramck. Bill is also the U.S. market correspondent for just-auto.com, a British auto industry publication, and a member of the Texas Auto Writers Association, which has named the Jeep Grand Cherokee the “SUV of Texas” several times and named the Ram 1500 as the “Truck of Texas” two years running.

Bill has owned five Plymouths (including the only 1962 “Texan”), one Dodge and one Chrysler and is still trying to figure out how to justify a Wrangler. He also has owned at least one of every 1:87 scale model of a Chrysler product. You can reach him directly at (206) 888-7324 or by using the form.


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