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The Wall Street Journal: Fiat Chrysler confirms talks with Peugeot over possible combination

Fiat Chrysler Automobiles NV and Peugeot maker PSA Group of France UG, +5.98% said they were in merger talks, discussions that could lead to the creation of a roughly $46 billion trans-Atlantic auto giant that would rank as the world’s fourth largest by volume.

The talks come as the world’s largest auto makers try to restructure their businesses as cost pressures mount and the global car market slows down after a period of heady growth.

Both auto makers separately confirmed talks after The Wall Street Journal reported Tuesday reported them first on Tuesday. Neither company provided further details.

“There are ongoing discussions aimed at creating one of the world’s leading mobility groups,” Fiat Chrysler FCA, +8.63% said in a short statement.

Auto-industry consolidation has long been a perennial theme, especially in Europe, where a crowded marketplace and stringent tailpipe-emissions rules make it difficult to earn money. Auto makers are also under intense pressure to innovate with electric vehicles and self-driving technology, forcing collaboration between traditional rivals to share the investment load.

An expanded version of this report can be found at WSJ.com

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