Fiat Chrysler and Peugeot owner PSA are in talks to combine in a deal that could create a $50 billion automaker, Trend reports citing Reuters.
The Wall Street Journal first reported the discussions. Fiat Chrysler shares rose sharply after the report and were up more than 7.5% in late afternoon U.S. trading. The companies had no comment.
Fiat Chrysler earlier this year broached a merger with French automaker Renault SA that ultimately collapsed.
Investors have speculated for several years that Fiat Chrysler was hunting for a merger partner, encouraged by the rhetoric of the company’s late chief executive, Sergio Marchionne. In 2015, Marchionne outlined the case for consolidation of the auto industry and tried unsuccessfully to interest General Motors Co in a deal.