PARIS -- When Carlos Tavares takes charge of a combined PSA Group and Fiat Chrysler Automobiles this year, he will quickly need to revive the automakers' fortunes in China, rationalize a sprawling global empire and address massive overcapacity.
Tavares has proved his credentials by turning around PSA but he will face an even bigger challenge once the automaker merges with FCA to create Stellantis.
Stellantis will have 14 car brands, from FCA's Fiat, Jeep, Dodge, Ram and Maserati cars to PSA's Peugeot, Citroen, Opel and DS brands.
Like all global automakers, Stellantis will be spending billions of dollars in the coming years to transform its vehicle range for an electric era but Tavares also has other pressing issues to tackle.
PSA and FCA are having a rough time in China against both international and local rivals, and Tavares himself has acknowledged that is not a tenable position.
Both PSA and FCA operate at just 8 percent of their capacity in the Asia-Pacific region, according to consultancy LMC. Most of that capacity is in China, a market of 21 million cars a year, and analysts said the merger is the best chance for a turnaround.
"On their own, each group might not be able to afford a reboot in China," said Philippe Houchois, an analyst at Jefferies investment bank.
Tavares has been careful not to discuss details of his plans for overhauling the Fiat Chrysler side of Stellantis. But he has been blunt about the problems PSA has in China and has pledged that the combined company will mount a comeback.
"No global car company can afford not to be in the largest car market in the world," he said at the Reuters Automotive Summit teleconference in November.