Auto Union to rule the world?

Auto Union logo

Suddenly last week’s story that the Volkswagen Group could rebrand itself as Auto Union now makes a lot more sense. Automotive News reports Volkswagen is considering a takeover of Fiat Chrysler Automobiles (FCA). It’s a move that’s been largely interpreted as means for Ferdinand Piech to achieve his aim of making the Volkswagen Group the world’s largest automaker.

If the Volkswagen Group did add FCA to its portfolio of automotive brands that would take it well beyond the reach of Toyota and General Motors as the highest selling car maker on the planet. Volkswagen Group could claim 14 million annual sales, around four million ahead of Toyota and GM.

German publication Manager Magazin first broke the news that representatives from the Volkswagen Group and FCA boards have met to discuss Volkswagen’s buy-in, although both companies deny any discussions have taken place. It’s thought that Piech has approached the Agnelli-Elkann family to acquire its 30% stake in FCA.

Previously, Volkswagen sources have coveted the Alfa Romeo brand. Under the watch of Sergio Marchionne and through the FCA agreement Alfa is enjoying a resurgence. On the back of the 4C the brand has recently relaunched in the United States after an absence of almost 20 years.

Other major brands under the Fiat-Chrysler umbrella include Dodge, Ferrari, Jeep, Lancia and Maserati. The addition of Jeep to the Volkswagen Group would help it quench the world’s insatiable thirst for SUVs.

Clearly, there’s a long way to go for this deal to take place, if it ever will. It’s expected the 30% share in FCA would be valued between US$5–6 billion. As it happens Volkswagen Group has a lazy US$24–25 billion in cash reserves up its sleeve.

If this VW-Fiat-Chrysler deal goes ahead then rebranding the entire group as Auto Union makes absolute sense. The Auto Union changes may still go ahead irrespective of the FCA deal. Taking a big picture view, though, Auto Union becoming known as the world’s largest car maker sits perfectly with Piech’s grand plan.

[Source: Automotive News | Pic: Raoul Pop]