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.

If you liked the article, share on:

Topics: psa

Comments

Recommended

November 17 is considered a very special day for Tesla, as this is the day that they revealed the highly anticipated Tesla Semi. But Elon Musk did not think the...
by - November 17, 2017
More details have emerged about the new sixth generation of the BMW M3 just as the German premium practically announced the end of the current-gen 3 Series with the unveiling...
by - November 17, 2017
All is set for Volkswagen’s plans to enter the electric vehicle game, as prompted by the so-called Dieselgate scandal. In fact, the German carmaker has already made a commitment to...
by - November 17, 2017
As BMW has already revealed, the next generation of the BMW M5 (F90) is a four-wheel drive high-performance sedan with overwhelming power output and torque at its disposal. However, it...
by - November 17, 2017
McLaren unveiled a one-off Gold - on - Black 720S at the 2017 Dubai Motor Show which will be on display throughout the entire stretch of this week’s event. The...
by - November 16, 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