The European car industry could face a further shake-up with Asian companies pouncing on the chance to buy assets as China's Beijing Automotive Industry Holdings has done with Swedish car maker Saab.
That could change the make-up of the sector for all players, Chrysler and Fiat (FIA.MI) Chief Executive Sergio Marchionne said at this week's Frankfurt Motor Show, where the talk is of slow recovery and plans for the future.
I think it's a great opportunity for some of them (Asian car makers) to come in and get a foothold, Marchionne said in Hall 6, which is dedicated to the Fiat and Chrysler brands.
That is obviously going to impact on the equilibrium of the European car industry and people need to think that through very carefully, he added.
Ivan Hodac, secretary general of European carmakers' association ACEA agreed, telling Reuters he saw further steps toward consolidation in European industry as the recovery picked up pace. We have been talking about consolidation for years, but restructuring is costly, he said, explaining why there had not been more change to date.
General Motors GM.UL reached a deal in June to sell its Swedish unit Saab to luxury sportscar maker Koenigsegg, with China's Beijing Automotive Industry Holdings (BAIC) taking a minority stake in Koenigsegg as part of the deal.
China's Geely Automotive (0175.HK) wants to buy Saab's Swedish rival Volvo Cars Corp, which has been put up for sale by U.S. parent Ford (F.N).
There has been a disparate set of deals coming out, with relatively small producers being associated with people that we would not have thought of as being consolidators, Marchionne said.
Fiat, which has just signed a cooperation deal with China's Guangzhou Automobile Industry Group, jumped at the chance earlier this year to take a 20 percent in Chrysler in exchange for its expertise and technology for making smaller, greener cars. Marchionne hopes to announce his plan for Chrysler's recovery out of bankruptcy in November.
His bid to buy Opel, the European business of U.S. giant General Motors, was snubbed with the prize going to Canadian auto parts supplier Magna (MGa.TO) and its Russian partner Sberbank (SBER03.MM). GM keeps a 45 percent stake.
EUROPE NOT IN DRIVING SEAT
Marchionne said the situation was going to be very, very fluid ... going forward, but, concerning his own point of view, he would only repeat that he talked to everyone.
Marchionne said consolidation was unlikely to be driven by European car makers.
There doesn't appear to be a willingness on the European side to make (consolidation) happen, he said.
Marchionne has said that the current crisis is likely to leave only six players standing and that survivors will need to have sales of at least 5.5 million units a year to gain the synergies needed to continue.
ACEA's Hodac echoed the figure, saying he thought a reasonable figure for a carmaker was 4-6 million units and adding that he thought there was a need for just five to seven carmakers in Europe.
Marchionne stuck to his target on Wednesday: If the magic number was 5.5 million to 6 million, the combined entity (Fiat and Chrysler) will get there. I never change my magic numbers.
(Reporting by Jo Winterbottom; Additional Reporting by Helen Massy-Beresford; Editing by Jon Loades-Carter)