Fiat Chrysler has made a “transformative” merger proposal for French carmaker Renault, the Italian firm said on Monday.
The combined business would be 50% owned by Fiat shareholders and 50% by Renault stockholders.
The carmaker said the tie-up would create a global automotive leader, with 8.7 million vehicle sales.
Carmakers have faced pressure to consolidate amid major industry shifts, including towards electric vehicles.
In a statement, Fiat said the planned merger would create a “world leader in the rapidly changing automotive industry with a strong position in transforming technologies, including electrification and autonomous driving”.
No plant closures would be caused as a result of the tie-up, the carmaker said.
Fiat said that if the firms’ 2018 financial results were totted up, the combined company’s annual revenues would be nearly €170bn (£149.6bn; $190.5bn), with operating profit of more than €10bn and net profit of more than €8bn.
Industry shifts toward electric models, along with stricter emissions standards and the development of new technologies for autonomous vehicles, have put increasing pressure on carmakers to consolidate.
Get more stuff like this
Subscribe to our mailing list and get interesting stuff and updates to your email inbox.