Published: Wed, July 04, 2018
Money | By Armando Alvarado

Hyundai responds to rumoured FCA merger

Hyundai responds to rumoured FCA merger

Meanwhile, Hyundai could take advantage of Chrysler's distribution network in the United States and the iconic Jeep SUV brand to shore up flagging sales in the US.

With FCA looking at an impending CEO change (Sergio Marchionne is set to step down in April of next year), stock prices may experience some form of movement following the transition.

According to Asia Times and its sources, Chung Mong-koo, the South Korean automaker's CEO, is waiting for FCA shares to fall before launching a takeover bid.

With this new possiblity coming to light, more news involving Hyundai and FCA could still keep blips on the industry's radar.

Since then, rumors about a takeover from the Volkswagen Group and Chinese automaker Great Wall have come and gone with much ado about nothing, but the recent rumors about Hyundai are a new twist. One caveat with that, however, is that Hyundai CEO Mong-koo is 80 years old, so retirement is looming.

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Perhaps most advantageous of all, for FCA at least, is that it has no electric vehicle strategy.

Hyundai's manufacturing footprint in the U.S.is also relatively small, unlike GM or VW, and would be exponentially improved if a merger between Hyundai and FCA happened.

A current free trade agreement between the US and South Korea would also help facilitate the merger and lower import/export costs compared to higher tariffs on European models. A spokesman for Hyundai told Motor Authority that the "rumor is totally groundless". We also reached out to FCA about the rumored merger, but they declined to comment.

If Hyundai and FCA merge, the new company would be the largest automaker in the world with around 11.5 million deliveries each year.

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