Tavares Touts Compatibility in PSA-FCA Merger

Bill Hampton

The planned merger between PSA Group and Fiat Chrysler Automobiles NV will create a company large enough to bankroll the cost of electrification and tighter emission limits, says PSA CEO Carlos Tavares.

He tells Automotive News Europe that the two companies complement each other well in terms of technology and market presence. As partners, he adds, the carmakers should be able to reverse their separate poor performances in China.

Tavares says the key to managing the merged companies will be a merit-based system that chooses leaders based upon their ability to deliver results for the combined entity. He insists that layoffs aren’t likely because the new company will have such a “high level of things to be achieved.”

Tavares favors a three-dimensional approach to decision-making for the merged companies that mimics PSA’s method. He describes the technique as reviewing issues across three axes: regions, brands and functions. He also emphasizes the matrix must be able to accommodate differences in the way people operate and express themselves.

If you “lock” the matrix, he warns, it will fail because people cannot be forced to all think and act the same way. In the end, Tavares says, the key to success will be to focus on the company rather than a brand, region or function.