Fiat Chrysler Automobiles (FCA) has announced it's withdrawing its proposal to merge with Groupe Renault, in a press release issued this morning.
"The Board of Fiat Chrysler Automobiles N.V., meeting this evening under the Chairmanship of John Elkann, has resolved to withdraw with immediate effect its merger proposal made to Groupe Renault," the statement said.
"FCA remains firmly convinced of the compelling, transformational rationale of a proposal that has been widely appreciated since it was submitted, the structure and terms of which were carefully balanced to deliver substantial benefits to all parties. However it has become clear that the political conditions in France do not currently exist for such a combination to proceed successfully.
"FCA expresses its sincere thanks to Groupe Renault, in particular to its Chairman and its Chief Executive Officer, and also to the Alliance partners at Nissan Motor Company and Mitsubishi Motors Corporation, for their constructive engagement on all aspects of FCA’s proposal," FCA concluded.
The company added it plans to continue delivering "on its commitments through the implementation of its independent strategy", likely referring to the raft of new models planned across its various brands – including Alfa Romeo, Fiat, Ferrari, Jeep, and Maserati.
It's been less than a fortnight since the American-Italian alliance first proposed a AUD$52.7b "transformative merger" with Renault, which revolved around a 50/50 partnership that would have seen the pair become the third largest carmaker globally behind the Volkswagen Group and Toyota.
Reports from overseas indicate the deal was met with some resistance from the French state, which owns 15 per cent of Renault, who had been seeking more influence over the proposed merger – likely the situation addressed in FCA's statement.
According to Automotive News Europe, citing a report by Reuters, the French government was looking for "firmer job guarantees and improved terms for Renault shareholders in return for blessing the US$35 billion tie-up".
We're expecting further comment from the Renault-Nissan-Mitsubishi Alliance in due course. Stay tuned.