Some things sound so improbable that you think that they just might be true. Reports that Volkswagen may buy Fiat-Chrysler (FCA) come under this category.
VW patriarch Ferdinand Piech has always been interested in buying Fiat's Alfa Romeo and Ferrari units, but the likelihood of VW acquiring the whole of FCA seems absurd. However, the idea has its appeal: It would allow VW to overcome its weakness in North America in a single stroke. Thanks largely due to Jeep and Dodge, FCA has an N.A. market share of 13 percent VW only has 3.5 percent.
During the depressing years of the Daimler-Chrysler merger, Piech explained time and time again why transatlantic unions cannot work. The mentalities of the companies are too different, he said.
And VW Group also still faces rivalries in Germany. Piech once told me that there is still competition between Audi's home base in Ingolstadt and its site in Neckarsulm, the former home of the car manufacturer NSU, more than 30 years after the merger of Audi and NSU.
There is actually little justification for VW to seriously pursue an FCA acquisition. Nonetheless, for weeks the rumor has spread through the industry that some members of the Agnelli clan, which owns 30 percent of FCA, want to exit the automotive business. They reportedly signaled to Volkswagen that they were willing to sell their shares. It is understandable that the Agnellis would be uncomfortable despite the FCA's positive situation right now.
The whole construct of Fiat-Chrysler rests on the U.S. market’s current strong position. The demand for Dodge pickups and Jeep SUVs has been uninterrupted. In other parts of the world, such as China and Europe, the group still has its problems.
If the winds were to shift in North America, the whole structure would quickly become unstable. In such times, VW would be a safe haven. The Agnellis know that. So does Piech.