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Stellantis is official: FCA and PSA merger finally sealed

MILAN — Fiat Chrysler and PSA sealed their long-awaited merger on Saturday to create Stellantis, the world's fourth-largest auto group with deep enough pockets to fund the shift to electric driving and take on bigger rivals Toyota and Volkswagen. It took over a year for the Italian-American and French automakers to finalize the $52 billion deal, during which the global economy was upended by the COVID-19 pandemic. They first announced plans to merge in October 2019, to create a group with annual sales of around 8.1 million vehicles. "The merger between Peugeot S.A. and Fiat Chrysler Automobiles N.V. that will lead the path to the creation of Stellantis N.V. became effective today," the two automakers said in a statement. Shares in Stellantis, which will be headed by current PSA Chief Executive Carlos Tavares, will start trading in Milan and Paris on Monday, and in New York on Tuesday. Now analysts and investors are turning their focus to how Tavares plans to address the huge challenges facing the group – from excess production capacity to a woeful performance in China. Tavares will hold his first press conference as Stellantis CEO on Tuesday, after ringing NYSE's bell with Chairman John Elkann. FCA and PSA have said Stellantis can cut annual costs by over 5 billion euros ($6.1 billion) without plant closures, and investors will be keen for more details on how it will do this. Marco Santino, a partner at consultants Oliver Wyman, said he expected Tavares to disclose the outlines of his action plan soon, but without divulging too many details at first. "He has proven to be the kind of person who prefers action to words, so I don't think he will make loud statements or try to over-sell targets," he said. Like all global automakers, Stellantis needs to invest billions in the years ahead to transform its vehicle range for the electric era. But other pressing tasks loom, including reviving the group's lagging fortunes in China, rationalizing its huge global empire and addressing massive overcapacity. "It will be a step by step process, also to allow the market to better appreciate every single move. I don't think we will have all the details before one year," Santino said.

Lexus tops JD Power Vehicle Dependability Study again, Buick bests Toyota

It shouldn't surprise anyone, but Lexus has once again taken the top spot in JD Power's Vehicle Dependability Study. That'd be the Japanese luxury brand's fourth straight year at the top of table. The big news, though, is the rise of Buick. General Motor's near-premium brand beat out Toyota to take second place, with 110 problems per 100 vehicles compared to Toyota's 111 problems. Lexus owners only reported 89 problems per 100 vehicles. Besides Buick's three-position jump, Scion enjoyed a major improvement, jumping 13 positions from 2014. Ram and Mitsubishi made big gains, as well, moving up 11 and 10 positions, respectively. In terms of individual segments, GM and Toyota both excelled, taking home seven segment awards each. The study wasn't good news for all involved, though. A number of popular automakers finished below the industry average of 147 problems per 100 vehicles, including Subaru, (157PP100), Volkswagen (165PP100), Ford/Hyundai (188PP100 each) and Mini (193PP100). The biggest losers (by a tremendous margin, we might add) were Land Rover and Fiat, recording 258 and 273 problems per 100 vehicles. The next closest brand was Jeep, with 197PP100. While the Vehicle Dependability Study uses the same measurement system as the Initial Quality Survey, the two metrics analyze very different things. The VDS looks at problems experienced by original owners of model year 2012 vehicles over the past 12 months, while the oft-quoted IQS focuses on problems in the first 90 days of new-vehicle ownership. Like the IQS, though, the VDS has a rather broad definition of what a problem is. Because of that, a low score from JD Power is no guarantee of extreme unreliability, so much as just poor design. In this most recent study, the two most reported problems focused on Bluetooth connectivity and the voice-command systems. The former leaves plenty of room for user error due to poor design (particularly true of the Bluetooth systems on the low-scoring Fords, Volkswagens and Subarus), while the second is something JD Power has already confirmed as being universally terrible. That makes means that while these studies are important, they shouldn't be taken as gospel when it comes to automotive reliability. News Source: JD PowerImage Credit: Copyright 2015 Jeremy Korzeniewski / AOL Buick Fiat Ford GM Hyundai Jeep Land Rover Lexus MINI Mitsubishi RAM Scion Subaru Toyota Volkswagen Auto Repair Ownership study

Marchionne defends FCA recalls, says Wrangler won't be all-aluminum

FCA CEO Sergio Marchionne recently received the 2015 Industry Leadership Award from the SAE Foundation. While speaking with the press after the event, the boss discussed his thoughts about some key issues regarding the company's future. One of the big regulatory issues facing FCA at the moment is the upcoming public hearing by the National Highway Traffic Safety into the automaker's handling of 20 recalls. Marchionne has no intention of testifying there, according to The Detroit News. The CEO also thinks that the government regulator is becoming much more aggressive in how it handles safety campaigns, but the Feds aren't necessarily doing a very good job of communicating that. "We need to work with the agency in a very cooperative and open way to make sure that we can meet their requirements for their new stance," he said, according to the newspaper. "We have no option but to comply with their requirements and we will. I have nothing to hide in this process. I just want clear rules." Marchionne also dropped the news that the company has changed its mind about making the next Jeep Wrangler totally from aluminum. "Because of the difference in cost, not just the new material but the actual assembly process, I think we can do almost as well without doing it all-aluminum," he said to The Detroit News. This seemingly opens the door for the model to remain in production in Toledo, OH, but only just a crack. Marchionne says that the new Wrangler would still use a large amount of aluminum, and there are "at least" two sites in contention for the assembly. The company doesn't have too long to make a decision because the model reportedly launches in 2017.