Fiat Chrysler Automobiles CEO Sergio Marchionne has been hoping to sell the company to the right kind of buyer for a while now. But, with no serious contenders, FCA has been forced to trudge onward into the future without a bonafide suitor.
That’s rumored to have changed, as numerous sources are claiming Chinese automakers have taken an interest in theÂ Italian-American company. However, whether these are potential one-night stands or a serious courtship remains unknown. Marchionne has previously specified he only wants to see FCA enter into the warm embrace of an established automaker and, while China has them, some would be better partners than others.Â
As to which foreign automakers, Automotive News claims numerous sources identifying executives from Dongfeng Motor Corp., Great Wall Motor Co., Zhejiang Geely Holding Group, and FCA’s current joint venture partner in China, Guangzhou Automobile Group, as all taking an active interest.
While some of you prepare your typing digits to express outrage that quintessentially â€”Â almost hyperbolically â€” American brands like Jeep or Dodge could never be owned by a Chinese entity, don’t forget that Chrysler used to be in bed with Germany’s Daimler and is currently an Italian-controlled multinational corporation incorporated within the Netherlands. FCA could definitely end up married-off to a Chinese company if the two companies hit it off. But how serious any of the involved automakers are â€” including FCA â€” is subject to questioning.
Chinese companies, whether automakers or not, are all under government pressure to expand outside China through the acquisition of foreign companies. There are also plenty of American brands purchased by Chinese interests in recent years you probably weren’t aware of: AMC Theaters, Motorola, Legendary Entertainment and General Electric’s appliances unit.
In the automotive realm, thisÂ drive to expand outside China’s borders prompted Geely’s purchase of Volvo in 2010 and Lotus in 2017. Last week, Bloomberg reported Chinese companies aim to spend around $1.5 trillion purchasingÂ overseas interests over the next decade.
“Right now, Chinese automakers enjoy the full support of the leadership in Beijing to go and make it happen,” Michael Dunne, president of Hong Kong investment advisory company Dunne Automotive, explained to Automotive News. “That’s something brand new, and it’s really picked up since 2015.”
FCA is trying to make itself as appetizing as possible for a buyout by streamlining production.Â A source claims FCA executives previously traveled to China to meet with Great Wall Motors, while Chinese delegatesÂ were spottedÂ at FCA’s headquarters in Auburn Hills, Michigan, as recently as last week.Â Fiat Chrysler also hostedÂ Cui Tiankai, China’s ambassador to the United States, Zhang Fangyou, chairman of Guangzhou Automobile Group and numerous members ofÂ the country’s Communist Party in 2016.
So, what would a hypothetical Chinese partnership with FCA look like? That depends largely on who is doing the buying. While automakers like Geely have taken a decidedly hands-off approach after purchasing automakers, others could be less apt to do so. However, since acquiring Fiat Chrysler serves predominantly as a doorway to Western markets for Chinese companies, it’s unlikely the initial changes made would be drastic.
Still, it’s likely to be less of a partnership and more of a takeover. WhenÂ Marchionne publicly began his quest to find a suitor for FCA in 2015, he admitted he didn’t believe Asia was interested in partnerships. “I don’t think Asia is partnerable,” he said. “No, you can be acquired by the Asians. I think China will buy you.”
[Images: Fiat Chrysler Automobiles]