Rumors of FCA Seeking Asian Partner Reignite — This Time With Hyundai

Snubbed by both the Germans and the Chinese, Fiat Chrysler Automobiles is continuing its journey to find the automaker that will sweep it off its feet and say, “Let’s build a factory together.” However, if CEO Sergio Marchionne maintains that FCA will be bought by an established automaker, he’s running out of options. The automotive dating pool isn’t particularly deep.

While there was some stirrings of vague Korean interest when news broke of talks between FCA and Chinese automakers, those rumors dissipated quickly. But reports of a possible business deal between Hyundai and the Italian-American company surfaced recently after Great Wall Motors shrugged off its proposed bid for Jeep. FCA later said it had not received any offer from the Chinese manufacturer.

Presumably, Great Wall would have used FCA to supplement its sport utility sales and begin making moves on North America. Another brand that might be interested in bolstering its supply of SUVs is Hyundai — something the South Korean press has been buzzing about all week. 

According to The Korean Herald, industry rumors of a possible merger between the two have been happening for a while. Lee Jae-il, an analyst with Eugene Investment & Securities, said in a recent report that Hyundai Motor would seriously benefit from the acquisition due to an expanded portfolio (SUVs and trucks) and higher consumer awareness of FCA brands in the United States and Europe.

Lee estimates a South Korean acquisition of FCA would cost roughly 11.2 trillion won (or $9.83 billion) if you included Maserati and high-tech parts unit Magneti Marelli, but only about 5.6 trillion won without them. That might be a good deal, especially since Hyundai is having problems with China right now and could use a stronger global footprint.

However, even though the American half of Fiat Chrysler would flesh out the brand’s portfolio extensively, the Italian portion wouldn’t add much, as South Korea is already pretty good at producing small cars.

At present, FCA is denying any and all rumors of a possible merger in Asia. We’ll see what comes of these rumors and continue musing about what Hyundai Fiat Chrysler Motormobiles might look like in the meantime.

[Imgae: Hyundai]


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