x close

We use cookies to improve our site and your experience. By continuing to browse on this website you accept the use of cookies.


Bookmark and Share

PSA buys GM's European operations

GM all-but exits Europe as it sells its Opel and Vauxhall brands.

Opel Propulsion plant

The €210m Opel Global Propulsion Systems Plant opened recently in Germany Image: Opel

The deal will cost PSA - the owners of Peugeot and Citroen car brands - €1.8bn ($1.9bn), with GM also having to pick up some $4-4.5bn worth pension and other business-related charges.

In return, GM will hand over it's loss-making Opel operations, as well as the UK Vauxhall brand, making PSA the second largest auto-maker in Europe.

The consolidation is estimated to deliver savings in the region of €1.7bn by 2026 but, more importantly, will provide PSA with significant scale in a highly competitive marketplace.  It will also bring additional expertise in electric and fuel-cell technologies.

According to reports, GM's Opel brand had lost a total of €9bn since 2009.  However, PSA is confident that incorporating the GM brands with its own marques will provide a profitable turnaround in the longer-term; PSA itself having been subject to a French Government and Chinese investment bail-out in 2014.

With Britain voting to leave the EU (Brexit), there is considerable concern that PSA will shut down the UK-based Vauxhall operations in Luton and Ellesmere Port near Liverpool.  However, PSA Chief Executive Carlos Tavares re-stated earlier commitments made with GM that both plants would be safe until at least 2020.

The US manufacturer will retain a presence in Europe with small volume Chevrolet sales.

Tags: automotive industry, Europe, GM, OEM Equipment

Published 6th March, 2017

FREE lubes bulletin

Subscribe to the OATS Bulletin: a streamlined look at the month's lubricants and additives news.

First name
Last name
Email
Company
Country
 

We will never pass your details to anyone else.
Privacy policy...