Stellantis CEO says merger of Fiat Chrysler, Peugeot prevents job cuts

Don’t expect to see a Peugeot dealership popping up down the block anytime soon.

That doesn’t mean the head of Stellantis, the new company formed from the merger this weekend of Fiat Chrysler Automobiles and PSA Group, won’t consider the possibility down the road. 

But for right now, the closest most Americans might get to seeing the French brand in action is in old “Columbo” reruns. The famed TV detective played by the late Peter Falk way back in the ’70s tooled around in a Peugeot 403 that had seen better days. Today’s Peugeot models are a far cry from Lt. Columbo’s machine, but that doesn’t mean it makes sense to try to sell them here.

Stellantis CEO Carlos Tavares, in his first news conference leading what is now the fourth-largest automaker in the world trailing only Volkswagen, Toyota and the Renault-Nissan-Mitsubishi Alliance, noted on Tuesday the relative strength of FCA’s market share in the United States, above 12%, with its current stable of brands, led by Jeep, Ram, Chrysler and Dodge. 

“It is possibly more important to focus on the profitable growth of those brands rather than bringing a new brand on top of what already exists, but we’ll see in the future,” Tavares said, noting that no final decision has been made.

One of the longtime goals for PSA Group had been a return to the U.S. market, and the company had even opened an office in Atlanta. Peugeot was last sold here in 1991.

What U.S. consumers are likely to see instead is the introduction of what Tavares called “sister cars.” Those would be vehicles that share components but remain distinct to the consumer. He gave as an example three current models from former PSA brands DS Automobiles, Peugeot and Citroen.

The focus on shared components gets at some of the numbers within the estimated $6 billion (5 billion euros) in annual synergies FCA and PSA Group said would result from the merger.  Critics, however, fear that the synergies would mean the end of certain brands, such as Chrysler and Dodge, and job cuts.

Tavares sought to allay concerns on both fronts.

While not offering specifics, Tavares said brands would be given a “strong opportunity” to rebound based on the implementation of the synergies, 75% of which should come from planning, engineering, manufacturing and purchasing. The scale of the combined company and its 400,000 employees is key, he said.

With Stellantis, those brands that did not receive as much investment because of past priorities could benefit from the ability to make sister cars that are less expensive to introduce, “and that is going to create some significant business opportunities for certain brands,” Tavares said.

FCA, under the late Sergio Marchionne, had instituted a plan to invest more heavily in Jeep, Ram, Alfa Romeo and Maserati than in others.