The French owner of the Peugeot and Vauxhall brands is in talks with Fiat Chrysler Automobiles (FCA) pursuing a merger that would create one of the world’s biggest carmakers, reports The Guardian.
PSA Group on Wednesday confirmed the existence of the talks, which come only months after a failed merger attempt between FCA and PSA’s French rival Renault.
FCA has long pursued greater consolidation in the car industry, with leaders of the Italian-American carmaker past and present keen to pool resources. Carmakers across the world are grappling with one of the biggest and most expensive upheavals in the industry’s history as they move away from fossil fuels and towards battery electric vehicles and autonomous technology.
Shares in Fiat Chrysler surged 10% in Milan on Wednesday morning after the Wall Street Journal reported that talks were under way. Shares in PSA rose by 5%, while shares in Renault fell.
In a brief statement, PSA Group said: “PSA Group confirms that discussions are in progress with the aim of creating one of the world’s principal automotive groups.”
A deal between PSA and FCA would still face obstacles, however.