Kept alive high-volume brands such as:

• Buick
• Chevrolet
• Cadillac
• GMC

Factoring in these aspects, GM has also recently undergone a major restructuring at a group level themselves. A deal between GM and FCA looks highly unlikely and it showcases that FCA requires GM more than the other way round.

Considering their strong portfolio in the small car segment, PSA seems to be the most likely automaker FCA should approach. A merger would help both brands to focus on their strengths, while at the same time gain sufficient market impetus for each other in those regions in which the other lags behind.
PSA has a rather strong small car portfolio that FCA can benefit from and needs to become more of a global player. Together PSA and FCA can cater to their specific needs of filling the gaps in each other’s portfolio. Yet a merger with PSA seems to be a slightly difficult proposition as PSA itself is struggling to recapture the market domination they once had and is looking to return to magnitude.

The future for FCA

The future is all about succeeding in the market or succumbing to its dynamics. There are three possibilities for FCA to succeed. If Marchionne is seriously considering to bring GM onboard, there is a back-door way to do it and FCA might well be pursuing it.

The second option would be to partner with tech-giants such as Google or Apple. A disruptor such as them is what FCA needs, as it would instantaneously equip the automaker with ground-breaking technological prowess across automated driving, best-in-class connectivity/HMI among other things, something FCA is currently not well-known for.

Thirdly, partnering with PSA seems to be the most logical way ahead. PSA will bring in the volumes required for FCA in Europe, while FCA can help PSA to become a global automaker by helping the French group with its manufacturing facility and dealership network globally, a win-win situation for both.