The PSA Group is currently in talks with General Motors over the purchase of the latter’s European business, which makes cars under Opel and Vauxhall brands. The French company makes Peugeot, Citroen and DS cars; with Opel on board, it will be the second largest auto group in Europe after Volkswagen, overtaking Renault-Nissan.
PSA is “exploring a number of strategic initiatives with GM with the aim of increasing its profitability and operating efficiency, including a potential acquisition of Opel,” a spokesman confirmed. However, PSA added that there could be “no certainty over the conclusion of an agreement”.
GM may keep a stake in the enlarged entity, according to Reuters. The two groups have tried to forge an alliance before, but that ended in 2013 when GM sold its stake in PSA. Currently, both share production of light commercial vehicles and certain SUV models.
PSA, which is also looking at a stake in Proton, has rebounded from a 2013-14 brush with bankruptcy to reach record levels of earnings. Under boss Carlos Tavares, the group sold 3.15 million vehicles last year. Tavares has signalled openness to a tie-up that would increase PSA’s scale and ability to meet growing investment demands in vehicle electrification, driving technology and connected services, the report adds.
On the other hand, GM has struggled to make Opel profitable. Even last year, when European auto sales hit a new high since 2007, the German company failed to breakeven. GM previously tried to sell Opel to Canadian parts maker Magna in the aftermath of the financial crisis, but backed out of the tentative deal in 2009.
According to Reuters, GM selling Opel would be the most dramatic demonstration yet of CEO Mary Barra’s strategy of prioritising profitability ahead of market share. Since taking over the helm at GM in January 2014, Barra has signed off on decisions to quit markets where GM lost money (Russia and Indonesia), stop selling Chevrolet cars in Europe, and slash unprofitable sales to US rental car fleets just to prop up market share.
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Suzuki is going to get angry. Proton seems to have forgotten them with the new Geely deal. Suzuki gave up their Suzuki brand and network in Malaysia all for the partnership with Proton.
Now, Proton is more interested in Geely
If Proton is clever, they will tie up with Suzuki or PSA.
Cause everyone in Malaysia will be happy to buy “rebadged Mat Salleh car”
That is Malaysian, as well as global mentality. Nobody dare buy a Proton with China parts or a rebadged Geely.
See how Naza rebadged the Peugeot last time, everybody rushed to buy one cause they said got cheap “French” car.
Volvo is Swedish. Now taken over by Geely. In short, if Geely mother happen 2 be Volvo, it also mean they are half Mat Salleh just like PSA. The only difference is one is French & the other is Swedish.
Proton did not forget about Suzuki. Instead, Suzuki hasn’t been very cooperative in their tie-up. It is Geely that’s highly interested in Proton.
Suzuki chairman said all changed when the gov kicked dr m out of proton. It seems like the chairman think proton is politically influenced and vulnerable
So no PSA-P1 then?
PSA tie-up with Proton is still not impossible even if at the same time PSA intends to buy Opel-Vauxhall, so long as PSA got the cash. Because in Proton’s case it’s not going to be a full takeover or even buying the majority stakes. Regardless of how much the percentage of the share , it’s going to be full access to Proton’s Tg. Malim facilities and their manpower in exchange of extensive technology transfer to Proton.
Well its just fair GM need to do what is necessary, to prevent falling down again and almost went into bankruptcy.
It’s stupid though. Opel is more than the European market. Opel is also supplying them with models for the US market, as well as for the Chinese market. The Insignia does sell in China. Then there is Australia, which also depends on Opel. And the technological expertise. Opel mostly knows how to build cars… especially “small” ones (though the new Corsa is awful, but their other models are fine). What if oil prices go up? Then there is demand for smaller cars with lower fuel consumption in the US, and while Ford has Ford of Europe to supply such models, GM doesn’t.
GM needs Opel. Besides, Opel is basically German, so there is some prestige too.
It seems like geely is the only serious frontrunner. I guess we all be driving old rebadge volvos then. Not really a bad thing.
The 240GL perhaps. :)
Not necessarily rebadged, could be more like the current Perdana exercise – the prospect of re-skinned Volvos. But definitely, re-skinned Geelys will put off buyers!
PSA seems to be on a buying spree. I just read that Hindustan Motors just sold their ailing Ambassador brand car manufacturer to PSA for the equivalent of just USD12 million. As someone mentioned (about the impending Proton stake sale), beggers can’t be choosers.
https://tinyurl.com/PSA-ambassador
If PSA acquires Opel, what would happen to Buick ? They literally rebadge Opel models
Then no more of that. Remember, Opel and Vauxhall also rebadged Holden models the big saloon and ute pick up. No more of those too.
I’ve owned a French car and a China Haval. In terms of reliability (over first 2.5yrs of ownership from new), China beats French. Perception can change when you actually bought and drive the cars. I only hope China cars dont become overpriced when perception starts changing.
Deutschland auto worker union will veto & block the takeover.
Suzuki never expressed any interest in buying Proton?
Suzuki is not cash-rich and Suzuki themselves even felt vulnerable to the current rapid pace in automotive development, they are looking for a close partnership with Toyota. So apparently strategic partnership with Proton somehow is not a significant agenda to them. Which brings us to the prospect of Suzuki brand being introduced back here in Malaysia!!!! The latest Suzukis looks like decent cars..
There is no ‘Deutschland auto worker union’.
? Of course there are unions in Germany, and they are pretty strong.
And now, it can be revealed where the PROTON new range will come from. Yeay!