Fiat Chrysler Automobiles NV and PSA Group completed the merger on Saturday and its common shares was listed on the Euronext in Paris and the Mercato Telematico Azionario in Milan on January 18, 2021 for trading.
On the first day of listing, Stellatis’ stock price rose by more than 7.5%. Stellantis Group will also begin trading on the New York Stock Exchange on Tuesday.
After the merger, Stellattis will be able to manufacture 8.7 million vehicles per year, ranking behind Volkswagen, Toyota and Renault-Mitsubishi-Nissan alliance, becoming the world’s fourth largest car company.
In addition, Stellattis will possess 14 brands, including Peugeot, Citroen, DS, Vauxhall, Opel, Alpha (configuration|inquiry) Romeo, Fiat, Lancia, Maserati, Dodge, Jeep, Chrysler, etc.
Carlos Tavares, CEO of the group, said that because the merger was expected to cut costs, the group would bring 25 billion euros ($30 billion) to shareholders in the next few years.
Fiat Chrysler (FCA) and PSA have stated that Stellatis could cut costs by more than 5 billion euros per year without closing the factory.
The new group Stellattis has made its debut in the market. This is also the debut party of its leader Tavares, who will lead a large-scale and complex car manufacturer.
Tavares has been advancing step by step in the automotive industry during his 40-year career. He succeeded in achieving an impressive transformation, but remained unknown on commercial flights to and from Detroit.
The slender, extremely active 62-year-old man did not appear to want to be Lee Iacocca, Dieter Zetsche, Sergio Marchionne or Carlos Ghosn.
However, whether or not he has become the focus of public attention, he will get more attention in the future. He will lead this automobile empire with approximately 400,000 employees and 14 brands into the uncertain future. Cars will rely more and more on batteries and software while internal combustion engines will die.
For Tavares, in order to succeed on Stellatis, he needs to do more than just simplify the process and cut costs, the strategy he followed when he brought PSA back from the brink of bankruptcy.
He must also prove his ability in products and catch up with the electrification and intelligence of the automotive industry.
Tavares, who was born and raised in Lisbon, showed his early enthusiasm at the Estoril circuit at the age of 14. Since then, he has participated in more than 500 races as an amateur driver. He said that he became an engineer because he lacked the talent and funds to engage in professional games.
After graduating from one of the top engineering schools in France, Tavares started his career at Renault in 1981. Before becoming Renault’s second person after Ghosn in 2011, he led the North American business of partner Nissan for two years. In 2013, as Ghosn planed to continue to serve as CEO, he left Renault within a few weeks and became the helm of the almost bankrupt PSA six months later.
The French government and China’s Dongfeng Motor Group participated in PSA’s stock issuance and 3-billion-euro financing, thus saving PSA. Then PSA achieved annual profit for the first time in three years.
He adopted a similar strategy for Opel and Vauxhall. In the past 20 years, these two brands have accumulated losses of about 20 billion U.S. dollars and were abandoned by General Motors to PSA in 2017. By cutting development costs and buying out thousands of employees, he quickly pushed these businesses to profitability.
Stephen Reitman, an automotive analyst at Societe Generale, said that in PSA’s 2014 recovery plan, “Tavares may be the most underestimated factor.”