(CNN)Fiat Chrysler Automobiles and Groupe PSA, the French maker of Peugeot and Citroën cars, expect their merger to be complete on January 16th, the companies announced Monday. The newly combined company will be called Stellantis.
Shareholders of both companies overwhelmingly approved the merger on Monday, the automakers said.
Fiat Chrysler (FCAU) produces the Chrysler, Dodge, Ram, Jeep, Fiat, Alfa Romeo, Maserati and Lancia auto brands. PSA, meanwhile, makes Peugeot, Citroën, DS, Opel and Vauxhall cars.
Upon completion of the merger, the combined company will become the world’s fourth largest automaker, said Jeff Schuster, an analyst with LMC Automotive. Together, the companies are worth an estimated $57 billion.
In 2019, the two companies sold a combined 8 million vehicles, compared to Volkswagen (VLKPF), which sold about 11 million vehicles that year.
While Fiat Chrysler and PSA compete in Europe, PSA has virtually no presence in the US, where Fiat Chrysler is the fourth largest automaker in terms of sales in the country. Both companies have struggled to compete in the rapidly growing auto market in China, though, said Schuster. The merger will not immediately help with that, he said, so that would remain a challenge for the new company.
While the two companies do compete with one another in Europe, their brands have somewhat different market positions, said Schuster.
“And I think there’s an [electric vehicle] expertise PSA has that FCA doesn’t,” he said, “so there’s some nice synergy there.”
The creation of the new company will help free up resources as it shifts toward electric and autonomous vehicle technologies, said Michelle Krebs, an analyst with Cox Automotive.
“The creation of Stellantis is simply a large-scale example of an underlying trend we’re seeing in the automobile business right now, as all serious automakers face the monumental task of reshaping their operations with an eye toward 2030, when EVs and autonomous technology will have shifted from emerging to mainstream,” she said.
Shares of Stellantis will begin trading on stock markets in Paris and Milan on Monday, January 18, and on the New York Stock Exchange the following day.
The merger requires some final regulatory approvals, the companies said, including those of the European Union and European Central Bank.
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