BRUSSELS -- A proposed merger of Fiat Chrysler Automobiles and PSA Group may harm competition in the small vans sector in 14 EU countries and Britain, EU antitrust regulators said on Wednesday as they opened a four-month investigation into the deal.
The companies want to create the world's fourth-biggest automaker to help offset slowing demand and share the cost of making cleaner vehicles to meet tougher emissions regulations.
Commercial vans “are a growing market and increasingly important in a digital economy where private consumers rely more than ever on delivery services,” EU Competition Commissioner Margrethe Vestager said in the statement. “We will carefully assess whether the proposed transaction would negatively affect competition.”
The deal will put the Italian-American automaker's brands including Fiat, Jeep, Dodge, Ram, Maserati and the French company's Peugeot, Citroen, Opel/Vauxhall and DS Automobiles under one roof.
The European Commission said it was concerned about the merged company's high market share in small vans, confirming a Reuters story on June 8.
"In many countries, either PSA or FCA is already the market leader in light commercial vehicles, and the merger would remove one of the main competitors," the EU executive said.
It said the deal could reduce competition in Belgium, Croatia, the Czech Republic, France, Greece, Hungary, Italy, Lithuania, Luxembourg, Poland, Portugal, Slovakia, Slovenia, Spain and the U.K., and set an Oct. 22 deadline for its decision.
The automakers reiterated their goal of closing the deal by the end of the first quarter of 2021.
"As we continue to make progress through our cross-company project teams, we will be detailing to the EC [European Commission] -- and other regulators -- the substantial benefits of the proposed merger to our customers, the European industry and each company," they said in a joint statement.
The automakers had declined to offer concessions to allay the EU competition enforcer's concerns during its preliminary review of the deal.
The deal has already received the green light in the United States, China, Japan and Russia.
Reuters and Bloomberg contributed to this report.
