MILAN/PARIS—Fiat Chrysler and Renault are set to confirm tie-up talks on May 27, with the board of the French carmaker called to an early morning meeting to discuss the situation.
It comes after news broke over the weekend that two of the world’s leading car companies are in talks on a comprehensive global combination that could address some of the main weaknesses of both.
The plan under discussion would involve some transfer of equity, according to a source close to the discussions.
Renault Chairman Jean-Dominique Senard presented an FCA-Renault merger plan to French Finance Minister Bruno Le Maire on May 24, Les Echos reported on its website. The French government has a 15 percent stake in Renault.
The deal being discussed would include guarantees covering corporate governance and employment in France and Italy, the French daily said.
Pressure for consolidation among carmakers has grown with the challenges posed by electrification, tightening emissions regulations and expensive new technologies being developed for connected and autonomous vehicles.
Earlier this year FCA Chairman John Elkann—a member of Italy’s Agnelli dynasty that controls the company—stressed the family’s commitment to the automotive industry. But he also added that they were prepared to take “bold and creative decisions” to help build a solid and attractive future for the company.
A source said earlier an announcement from Italo-American FCA could provide some concrete although initial details but added the situation was still “fluid”.
A separate source with direct knowledge of the situation confirmed that the Renault board were to meet early on May 27 at 8.00 a.m. local time (1.00 a.m. EDT) to discuss the issue.
