Fiat Chryslers CEO, Mike Manley, who took control of the firm in July after the death of Sergio Marchionne, has sold the company’s auto parts business [Magneti Marelli] to Japan’s Calsonic Kansei for $7.2 billion. The deal is expected to close next year.
This deal has now created one of the world’s biggest auto parts suppliers, at a time when the automotive industry drifts towards electric cars. Car companies such as Toyota and GM are pairing up with tech firms to try and come out in front of competitors during this change.
Beda Bolzenius, CEO of Calsonic Kansei, said in a statement: “Our industry has gone through fierce change in recent years and the phase to come will be even more dynamic.”
The new business will have a combined annual revenue of $17.5bn with a total of 200 facilities globally, and will give Fiat Chrysler the time needed to improve its other business aspects such as getting a bigger share of the Chinese market and competing in the electric car industry.
Both Calsonic Kansei and Magneti Marelli have huge histories in the industry. Magneti was founded 99 years ago and then bought by Fiat in 1967, and Calsonic Kansei first began 80 years making radiators for Nissan cars. Both suppliers specialise in electronics and exhaust systems.