Dongfeng should study PSA stake purchase first, says general manager

Article by Anita Panait, on October 21, 2013

Dongfeng Motor Corp. should first study whether it makes sense to acquire a stake in French carmaker PSA/Peugeot-Citroen before making such a move, according to Dongfeng general manager Zhu Fushou. PSA is considering selling shares to Dongfeng and the French government to boost up its financial coffers as it remains struggling in Europe, where the vehicle market is still at a slump, according to people privy with the matter.

State-owned companies in China typically have to get approval from the National Development Reform Commission before starting formal discussions over foreign investments.

Zhu remarked during an auto forum in Wuhan, China that "it's too early to talk about whether we have NDRC's approval to go ahead with talks." He remarked that what matters is whether the acquisition of a stake in PSA is reasonable or not, not NDRC's approval. Zhu's remarks indicate that Dongfeng has yet to get approval from the Chinese government on PSA.

The French government is monitoring discussions with Dongfeng and may take part in the talks if the latter decides in favor of a stake acquisition, two of the people privy with the matter remarked. The sources added that negotiations are still at an early stage and are not expected to be finished for several weeks.

PSA’s auto unit logged a EUR510-million operating loss in the first half of 2013 and consumed EUR3 billion in 2012. The French carmaker is planning to cut 11,200 jobs in France by 2015 and shut down its Aulnay plant as part of its efforts to reduce costs. Earlier this year, Dongfeng terminated acquisition talks with Fisker Automotive Inc., Chairman Xu Ping said in March, citing "some distance" between the future plans of the two carmakers. DongFeng then acquired an undisclosed stake in Fujian Motor Industry Group Co. in May 2013.

Topics: psa

If you liked the article, share on:

Comments

Login or Create new account to add a comment!

Recommended

Retired Formula 1 driver Jenson Button has just received his brand new McLaren MSO 675LT Spider. This was confirmed after McLaren Beverly Hills posted a picture on its official Instagram...
by - January 24, 2017
Ford and Toyota have come together in the hopes of standardizing their vehicles’ smartphone integration system. The open-source platform is said to compete with Google Android Auto and Apple CarPlay...
by - January 24, 2017
The race to autonomous driving has been dictated by the need to make the road safer and reduce the incidents of vehicle crashes. Several major carmakers in the world have...
by - January 24, 2017
The Shooting Brake is probably the least rendered body shape in the automotive world. But it’s also the most sought after design among car nuts for its unique, old-fashioned charm....
by - January 23, 2017
Perhaps to make the upcoming Valentine’s day more special, Tinder dating app and Ford UK have cooked up a special blind date for all the single blokes and chicks in...
by - January 23, 2017
Facebook

Youtube Channel

Tip Us
Do you have a tip for us?
Did you film an important event?
Contact us
Newsletter
Subscribe to our newsletter!
Subscribe
Galleries