By Stefano Rebaudo
AMSTERDAM, April 14 Fiat Chrysler
Chief Executive Sergio Marchionne rowed back on his search for a
merger on Friday, saying the car maker was not in a position to
seek deals for now and would focus instead on following its
Marchionne had repeatedly called for mergers in the car
industry and a tie-up has long been seen as the ultimate aim of
his relaunch of Fiat Chrysler, which he is due to leave in early
2019 after 15 years at the helm.
He sought a merger with General Motors two years ago
but was rebuffed. Only last month he said Volkswagen - the
market leader in Europe - may agree to discuss a tie-up with FCA
in reaction to rival PSA Group's acquisition of Opel.
Marchionne told the annual general meeting in Amsterdam he
still saw the need for car companies to merge to better shoulder
the large investments needed, but said Fiat Chrysler was not
talking to Volkswagen.
"On the Volkswagen issue, on the question if there are
ongoing discussions, the answer is no," he said. He added,
without elaborating, that Fiat Chrysler was not at a stage where
it could discuss any alliances.
"The primary focus is the execution of the plan," he said.
FCA has pledged to swing to a 5 billion euro net cash
position by 2018, from net debt of 4.6 billion euros at the end
of 2016 - an achievement that Marchionne has said would put it
in a better position to strike a deal in the future.
Volkswagen, which is still reeling from an emissions scandal
that hurt its profits, initially spurned FCA's approach.
However, CEO Matthias Mueller said last month the group had
become more open on the issue of tie-ups and invited Marchionne
to speak to him directly rather than with the press.
Fiat Chrysler Chairman John Elkann underlined the message
that finding a merger partner was not a priority.
"I'm not interested in a big merger deal," he said.
"Historically, deals are struck at times of difficulty ... we
don't want to be in trouble."
Elkann is the scion of Fiat's founder and top shareholder
the Agnelli family. He has said in the past he was prepared to
have the Agnelli's stake severely diluted in exchange for a
minority holding in a larger auto group.
"I believe the priority for FCA is to press ahead with this
ambitious (business) plan despite the difficult environment," he
FCA pledged in January to nearly halve net debt this year,
as part of the 2018 plan. Doubts remain about its exposure to a
peaking U.S. market, weakening pricing there, recall costs and
potential fines over emissions.
(Reporting by Stefano Rebaudo; Editing by Andrew Heavens)