An alliance has been reached between PSA/Peugeot-Citroen and General Motors that aims to achieve $2 billion in annual savings within five years. In a statement, GM CEO Dan Akerson said that this deal offers plenty of opportunity for its two companies. He added that GM’s independent plans as well as this alliance would put GM on track to achieve long-term sustainable profitability in Europe.
PSA CEO Philippe Varin said that this partnership is “rich in its development potential” as the entire group has been tasked to fully benefit from this deal.
GM will get a 7% Peugeot stake while the two firms will share research and development as well as vehicle platforms and technologies. The deal was announced just as the European markets had closed.
A statement was released by the two companies about how they will share vehicle platforms, components and modules and the creation of a global purchasing joint venture for the sourcing of commodities, parts and other goods and services from suppliers with combined annual purchasing volumes of around $125 billion.
In a statement, it was revealed that PSA’s and GM’s respective marketing divisions will be independent of each other. Many analysts and investors have criticized this deal, which is entered while PSA and GM's Opel unit face the challenges of sluggish sales and overcapacity in Europe. Credit Suisse analyst Erich Hauser sent a note to investors, saying that this isn’t the kind of solution that’s needed in the European mass market.