Hyundai shows interest in buying FCA speculatively and if it becomes true the Korean brand will become the largest car maker in the world
Recent rumours surfaced on the internet suggested that South Korean auto major Hyundai is showing interest to buy FCA (Fiat Chrysler Automobiles). The move would effectively make the global manufacturer the largest in the world. According to The Korea Herald, an analyst from Eugene Investment & Securities, Lee Jae-il said that the FCA purchase would help Hyundai in establishing itself in countries of Europe and also in the United States.
Besides enabling it to expand its footprint, he said that both companies can mutually benefit in terms of exploring new opportunities and increasing the global market share. The total production both companies managed was 11.5 million vehicles last year and it shows the vast potential when Hyundai decides to buy the Italian-American brand. Jae-il further said Hyundai is denying the possibility of a merger but the necessity to acquire a company is higher than ever due to the US and Chinese market crisis currently being endured.
He added that the possibility of Great Wall Motors buying Jeep has also been suggested and Hyundai has emerged as a possible player as well. We reported earlier of Chinese brands showing interesting in buying FCA to expand their global reach despite no concrete details. The talks of potential merger between Hyundai and FCA came out last month when FCA head Sergio Marchionne was said to have been seeking relationship with a large Asian automaker.
It is believed that the acquisition of FCA would cost Hyundai an estimated $9.83 billion. Without considering brands like Maserati and parts producer Magneti Marelli, the deal could go down as low as close to $5 billion. However, not all were convinced about the positivity of the deal. An industry insider was concerned that the if Hyundai buys FCA entirely, there is a fear that Fiat branded cars could overlap with Kia Motors’.
Source: TheKoreaHerald