CCI Approves the Merger of Peugeot SA into Fiat Chrysler Automobiles N.V.

On June 4, 2020, CCI approved the merger of Peugeot S.A. (‘PSA’) with and into Fiat Chrysler Automobiles N.V. (‘FCA’).^[1]

PSA is the holding company of a French-based group, which is primarily a global OEM and dealer of: (i) motor vehicles; (ii) passenger cars; and (iii) light commercial vehicles. It also provides ancillary services such as financing solutions for the acquisition of motor vehicles, and mobility services and solutions. In India, PSA (through a joint venture) is inter alia, active in the manufacturing of MB6 gearboxes (a component of powertrains) for the captive consumption of the PSA’s group. FCA is engaged in designing, engineering, manufacturing, distributing and selling vehicles, components and production systems worldwide. It is also engaged in retail and dealer financing, leasing and rental services through its subsidiaries, joint ventures, and commercial arrangements with third party financial institutions.

CCI observed no existing overlaps between PSA and FCA. However, since PSA planned to enter the Indian automobile market in the first quarter of 2021, CCI observed potential overlaps in the passenger vehicles segment. CCI observed that the market of passenger vehicles in India could be broadly segmented as: (i) passenger cars; (ii) utility vehicles; and (iii) vans, and further sub-segmented on the basis of other factors such as price and features. CCI noted that the potential overlaps were not likely to raise any competition concerns, considering the overall presence of the parties and the presence of other players such as Maruti Suzuki, Honda, Toyota, and Tata. CCI left the exact definition of relevant market open, since the combination would not give rise to competition concerns irrespective of the manner in which the market is defined.

Additionally, CCI noted a potential future overlap in the automotive finance segment. Since the financing services provided by the parties were intended for their respective brands of cars, and there were various other players such as banks and non-banking financial companies present in the segment, CCI did not find any competitive concerns.

Accordingly, CCI granted its approval.

 

^[1] Combination Registration No. C-2020/04/740