Across the Vanishing Borders

More and more, auto manufacturing is becoming a multinational business. Last week the French government approved the first deal in history under which companies from two countries, France's tire-making Michelin and Italy's car-making Fiat, will share control of a major auto manufacturer, France's Citroen. The companies had agreed on the outlines of the contract in 1968, but only now--long after De Gaulle had departed--did the government approve.

The majority of Citroen's stock will be put into a new holding company, of which 51% will be owned by Michelin and 49% by Fiat. Since Fiat's sales are much greater than Michelin's ($2.3 billion compared with $1.1 billion last year), many French observers expect that the Italian company will ultimately dominate Citroen, which lost money last year on sales of $1.4 billion. The deal will strengthen the position of Gianni

Agnelli's Fiat in the world auto market and more important, will probably open the way to further big business combinations across Europe's rapidly vanishing borders.

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