Hyundai and Fiat-Chrysler looking at a partnership

South Korean car maker Hyundai is in talks with Fiat Chrysler Automobiles – an Italian-American automaker. The companies are looking at a partnership but there won’t be a merger. This has just been confirmed by Sergio Marchionne, the CEO of FCA.

Here is what he said,

There is the potential of a technical partnership with Hyundai, which already supplies some components and transmissions for the U.S. Let’s see if we find a deal to develop transmission and hydrogen.

As Mr. Marchionne’s comments indicate, the tie-up between Hyundai and Fiat-Chrysler will focus on transmissions and hydrogen-powered cars. Although every major car brand in the world is looking at electric cars, there is a small set of automakers looking at the hydrogen fuel cell as the future of automotive propulsion.

Honda and Toyota are already in advanced stages of hydrogen powered cars while Hyundai has also invested into this technology. By tying up with Hyundai, FCA may gain access to hydrogen fuel cell powered car technology. In return, FCA may give Hyundai transmission technology that Magneti Marelli has developed.

Exact details on what will be shared are not available for now. Both Hyundai and FCA have significant presence in North America, one of the largest car markets in the world. While Hyundai is now well-regarded in the US, FCA brands like Jeep and Dodge are legendary automakers of America.

Both Hyundai and FCA operate in India as well. Hyundai is India’s second largest car maker, and is a very popular brand here. FCA is one of the smallest car makers in India, currently in the second-last place, just above Skoda. However, FCA, through Fiat, has been in India for many decades and is now trying to reinvent itself through the Jeep SUV brand. And it has tasted success with the Compass SUV being a good seller. For now, we are not sure if the global FCA-Hyundai tie-up will have an impact in India as well.

Via Bloomberg