Fiat Chrysler proposed merging with France's Renault on Monday. The move would create the world's third-biggest automaker and save billions of dollars needed to invest in the race to make new electric and autonomous vehicles.
The merged company would make some 8.7 million vehicles a year, leapfrogging General Motors and trailing only Volkswagen and Toyota. Shares of both companies jumped over 10% on the news of the offer, which would see each side's shareholders split ownership in the new manufacturer.
Renault welcomed the idea. The company's board met Monday at its headquarters in Boulogne-Billancourt outside Paris to discuss the proposal and said afterward that Renault will study it "with interest." In a statement, Renault said such a fusion could "improve Renault's industrial footprint and be a generator of additional value for the Alliance" with Japan's Nissan and Mitsubishi.
Fiat Chrysler's offer comes at a key moment for Renault. The French manufacturer had reportedly wanted to merge with Nissan, but those plans were derailed by the arrest ofon in Japan.