The boards of Fiat Chrysler Automobiles and Peugeot maker PSA Group were meeting separately on Tuesday to discuss finalizing an initial agreement for a $50 billion merger to create the world's number four automaker, people familiar with the matter told Reuters.

A person close to FCA said the two companies could announce the signing of a binding memorandum early on Wednesday, followed by a conference call to explain further details later in the day.

Ahead of the meetings, entities representing the Peugeot family, Etablissements Peugeot Freres and FFP, unanimously approved a proposed memorandum of understanding for the planned merger, a person familiar with the situation said.

The French state, which owns about 12 percent of PSA and has board representation, supports a binding memorandum of understanding that reflects minor changes to an accord unveiled by the two automakers on Oct. 31, Bloomberg reported on Monday. The combination "makes sense in order to build a new champion with global scale to take on the challenges of sustainable mobility," a French finance ministry official said in a statement.

FCA and PSA announced their plan six weeks ago to create an automotive powerhouse that would challenge Volkswagen Group in Europe, while maintaining Chrysler's Detroit 3 presence in the U.S.

The new company would be based in the Netherlands and headed by PSA CEO Carlos Tavares. Fiat Chrysler Chairman John Elkann would keep his role as chairman.

The deal will turn two midsize automakers into a global giant, with sales of more than 8 million vehicles a year and a stable of brands including PSA's Peugeot and Citroen and Fiat Chrysler’s Jeep, Alfa Romeo and Ram.

The automakers are responding to growing pressure on the industry to pool resources for product development, manufacturing and purchasing in the face of trade tensions, a global sales slowdown and an expensive shift toward electric and self-driving technology.

Reuters and Bloomberg contributed to this report

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Ford spokesman Mike Levine did not respond to a request for comment, but tweeted out a GIF of a laughing Ryan Gosling.

Analysts following the reveal were skeptical the vehicle could make a dent in the lucrative pickup segment, especially with Ford and General Motors both working on their own electric pickups.

GM CEO Mary Barra said the automaker's first electric pickup truck model will go on sale in the fall of 2021. "It will be a very capable truck, I'm pretty excited about it," Barra said at an investor conference in New York on Thursday.

Ford aims to sell an electric F-series in late 2021, Reuters reported.

Electric pickups and SUVs could help Ford and GM generate the significant EV sales they will need to meet tougher emission standards and EV mandates in California and other states. The Trump administration is moving to roll back those standards, but electric trucks are a hedge if California prevails

Demand for full-size electric pickups in the near term may not be huge. Industry tracking firm IHS Markit estimates the electric truck segment - both full- and midsize models - will account for about 75,000 sales in 2026, compared with an expected 3 million light trucks overall. The Tesla pickup is not part of that estimate.

Tesla's pickup "will be a niche product at best and poses no threat in the pickup market as we know it today," Matt DeLorenzo, senior executive editor at Kelley Blue Book, said in a statement. "The other downside is that this truck will have no federal tax credits by the time it comes out.”

Tesla's Model 3 sedan is the world's top-selling battery electric car. The California-based automaker has so far sold mostly Model S and Model 3 sedans, but also offers the Model X SUV and starting next year the Model Y compact SUV.

Reactions on Twitter ranged from love to hate of Tesla's sharply angled vehicle.

"I just watched tesla release the #cybertruck and honestly? My life feels complete," wrote @aidan_tenud, while @nateallensnyde wrote "Its nice to see Elon Musk make a cardboard box car he drew in kindergarten."

Musk earlier tweeted that the design was partly influenced by the Lotus Esprit sports-car that doubled as a submarine in the 1970s James Bond film "The Spy Who Loved Me" as well as by the movie Blade Runner.

Reuters contributed to this report

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