If you’ve been following the intermittent dramedy of Fiat Chrysler Automobiles (FCA) trying to spin off the some unprofitable part of their business in order to climb back as quickly as it can out of the red and back into the black, we need to congratulate you on your patience and attention span.
Rumours have come and gone about the group’s chief executive Sergio Marchionne approaching several potential suitors with a number of different proposals, emerging without a deal, have gone back as far as 2014. From GM to Volkswagen to Citroen to Nissan to a number of deep-pocketed Chinese manufacturers, most of these reports were flatly denied or spun off as idle chatter.
There’s still one quite major faction of the automotive realm that he hasn’t seemed to have brought up the idea with, the South Koreans. The Hyundai Motor Group, who also owns Kia, represents a reach that is significantly expanding, most recently into the premium space with the Genesis sub-brand.
Recently, thanks to Reuters, it was revealed that talks of a possible merger had started between representatives from Hyundai with the FCA chief, but have now fizzled. However, the possibility of a technical partnership being inked is still on the table.
Marchionne revealed this to reporters over the weekend at an event to reveal the 2018 Formula 1 season contender for the newly minted Alfa Romeo Sauber team, in which the former is now an official title sponsor, marking the return of the hallowed name to the sport since its departure as an engine supplier in the late 1980s.
Because of how various cars made by FCA brands use components sourced from Hyundai, the 65-year old CEO hopes to use this existing relationship as a springboard to jointly further the development of transmission and, interestingly, hydrogen fuel cells. Both of these are subjects of focus for Hyundai, who has a dedicated in-house division for each.
FCA owns transmission manufacturer Magneti Marelli, which would likely be the most prime candidate to whet Hyundai’s appetite for some form of technical tie-up. Though, the subsidiary also supplies various other components pertaining to electronics, suspension, lighting, powertrain technologies, and exhausts.
Comau, another subsidiary of FCA which specialises in robotics and artificial intelligence, could also be included in possible deal with Hyundai. “Whether it happens as a spin-off or a distribution to shareholders, or whether we will raise some money in the process -- all things to be discussed with the board, we haven’t made up our mind,” he said.
Marchionne’s tenure as the FCA chief executive is due to end in April 2019, by which point he is under pressure to return the corporation he oversees to sustained profitability. He is expected to outline the details of this plan, reportedly, in the second quarter of 2018.