NO DEAL: GM gives Fiat boss cold shoulder

Opel CEO Karl-Thomas Neumann has quashed any rumours GM’s European operation was secretly doing a deal with Sergio Marchionne’s Fiat Chrysler Automobiles (FCA).

Describing a tie-up with another car-maker outside of Opel’s technical partnership with PSA/Peugeot/Citroen as a “big mistake”, Neumann said his GM brand would instead make better use of its resources.

"In principle Marchionne is right, the auto industry develops the same things 10 times over," Neumann said.

The rebuttal of a potential tie-up between FCA and GM follows rumours that FCA CEO Sergio Marchionne sent an email to GM CEO Mary Barra back in March suggesting both car-makers should join forces.

In the secret email, denied by Marchionne, the Fiat boss was reported to have drawn up a plan that merged all of GM’s operations, including Holden, with Fiat Chrysler. The result would have been the formation of an automotive giant that would save billions of dollars.

Those plans now seem in tatters, not least because yesterday GM’s president Dan Ammann said that he saw no need to merge with another car-maker to maintain profitability.

"We are focused on executing our plan. I believe we have opportunities within GM," he said.

Opel for many years has struggled to make a profit and last year returned an operating loss in Europe of $239 million in the first quarter, slightly down from $284 million a year earlier.

Ammann said that despite this and the slump in Russian markets, GM’s Euro business was on track to reach profitability next year.

Opel’s technical partnership with PSA will bear fruit in the shape of new compact crossovers, small people-movers and some small vans.

Despite the huge personal setback for Marchionne, he told newswire Automotive News Europe: "I am absolutely certain that before 2018 there will be a merger.

“It's my personal opinion, based on a gut feeling," he said.

Marchionne did not specify which car-makers would merge, or indeed, if the deal would involve Fiat Chrysler Automobiles.