The boards of Fiat Chrysler Automobiles and PSA Peugeot on Wednesday signed a binding merger deal creating the world’s fourth-largest automaker with the scale to confront the challenges of stricter emissions regulations and the transition to new driving technologies. The companies said in a joint statement the new group will be led by PSA's cost-cutting CEO Carlo Tavares, with Fiat Chrysler’s chairman John Elkann as chairman of the merged company. Fiat Chrysler CEO Mike Manley will stay on, but it was not announced in what capacity. No name for the new company has been decided, executives said in a conference call, but both Tavares and Manley insisted that it was not a "touchy subject. We have two very historied companies coming together. ... [It will be] an interesting process.''
The deal, which was unveiled in October, was announced as a 50-50 merger, but PSA has one extra seat at the board and Tavares at the helm, giving the French carmaker the upper hand in daily management, reports the AP. The executives said they expect the deal to take 12 to 15 months to close. It will give birth to a group with revenues of nearly $190 billion and producing 8.7 million cars a year—just behind Toyota, Volkswagen, and the Renault-Nissan alliance. The merger is expected to create $4.1 billion in annual savings, which will be invested in "the new era of sustainable mobility'' and to meet strict new emissions regulations, particularly in Europe. (The AP has much more on the merger and the companies' relative strengths here.)