In a move that sent shockwaves around the global auto industry,... Fiat Chrysler -- out of the blue -- has announced it's pulling the plug on its proposed multi-billion dollar merger Renault.<br />Hong Yoo tells us why.<br />Fiat Chrysler's proposed merger with Renault, which could have created the world's third largest automobile company, has collapsed on Wednesday.<br />In a statement, the Italian-American carmaker said "it has become clear that the political conditions in France do not currently exist for such a combination to proceed successfully".<br />Its plan to join forces with Renault collapsed after the French government, Renault's biggest shareholder, wasn't ready to sign off on a deal.<br />The French government had initially supported the proposal because of the money that could be saved by sharing research, purchasing and other activities.<br />But Renault's powerful labor union objected to a deal, worrying it could lead to layoffs if Fiat has the power to favor operations in Italy over France.<br />And the French government said it wouldn't support a 50-50 merger proposal unless Nissan, Renault's partner in the world's biggest auto alliance, guaranteed that its alliance with Renault would continue after the merger.<br />French Finance Minister Bruno Le Maire said that an agreement could not be reached between all partners in the negotiations on the government's conditions for a deal.<br />He requested more time, saying there was no need to rush through a deal and that the French government wants this merger to happen.<br /><br />"And finally, we remain open to any industrial consolidation opportunity, but once again, in calm, without rushing, in order to guarantee the industrial interests of Renault and the French nation"<br /><br />The merger would have saved the carmakers more than 5-point-6 billion dollars a year.<br />But Fiat walked away to look for another option as they had been urging Renault to do a quick deal.<br />Hong Yoo, Arirang News.<br />
