What’s in store for Chrysler and FCA after Peugeot (PSA)?
Chrysler has had a rough time over the past 30 years. After nearly going bankrupt, it became one of the most successful automakers in the world, only to be acquired by Daimler-Benz and spit out, a small shadow of its former self, less than ten years later. Then another bankruptcy under the greedy leadership of private-equity firm Cerberus, then a purchase by Fiat which shoved the company into its current lane—maker of big Rams, Jeeps (some of which are based on Fiats), minivans, and big Dodge and Chrysler cars.
Fortunately for American autoworkers and engineers, none of those seem to duplicate the Peugeot line. However, the electrification programs in both Michigan and Italy may well suffer some losses, because Peugeot is far ahead of Fiat Chrysler (FCA) in hybrids—despite the fine PHEV Pacifica—and in battery-electric cars.
While Peugeot generally makes cars that are larger than Fiats, and the two companies almost seem to have been created to merge together, one can see definite savings in powertrain, as well; and the Fiat line has been pared down quite a bit in recent years already. Indeed, this purchase may help Fiat, which recently dropped the Punto, by allowing its reintroduction on PSA’s newer Common Modular Platform (CMP). However, given that both Fiat and Peugeot specialize in small engines, there may be some pink slips handed out in Italy. Or in France. It’s hard to say. Regardless, Peugeot’s largest gasoline engine is well under 2 liters, so the GME, Pentastar, and Hemi should be safe for a while. The GSE is brand new and may coexist with the Peugeot series, or fight it out for a while.
Some have already suggested that the Citroën DS may give new life to Chrysler, and that’s certainly true. Indeed, the whole project of converting the Chinese Jeep Grand Commander into an American Dodge or Chrysler may be abandoned in favor of bringing over some Peugeot crossovers which were actually designed from the start to be what they are. Jeeps are always going to be heavier than cute-utes, because they have to withstand a good deal of punishment if they’re taken off-road—yes, even the little Renegades that can’t handle the old Jeep testing regimen. Peugeot has crossovers that were created to be crossovers, not off-road vehicles.
The entire Opel line might also be available; General Motors only recently sold Opel to Peugeot. That said, they may have included a contract provision banning the sale of Opels in North America. Chances are, incidentally, that this purchase is going to hurt in Germany; the group can shift production to the cheaper Italian factories, closing the old Opel plants, assuming the German government allows it.
One of the primary objectives is to achieve economies of scale for both automakers, which will now have much more complete product lines; and to reduce the expense of moving forward to a world of electric cars and autonomous driving. The costs of development of these technologies will be cut almost in half by the pairing of PSA and FCA. That’s a real benefit to two profitable but struggling automakers.
Clark Westfield grew up fixing up and driving past-their-prime American cars, including various GM and Mopar V8s. He has ghostwritten auto news for the last few years, lives in Farmingdale, New York, and can be reached at +1.516-531-4021.