Louis Gallois was appointed by PSA/Peugeot-Citroen as France's board representative at the carmaker. This comes after the government acted to help the automaker’s bank unit. Gallois, who used be the head of planemaker Airbus's owner, will serve on PSA's supervisory board after ratification at the annual shareholders' meeting on April 24.
Gallois, who is now 68, led Airbus parent European Aeronautic, Defence & Space Co. for nearly six years until May 2012. Last month, Gallois published a report over France's business competitiveness.
President Francois Hollande had commissioned the study. As part of an agreement on Oct. 24, the French state and PSA's labor unions would each get board representation. It also called for the government to guarantee up to 7 billion euros ($9.2 billion) in new bonds sold by the carmaker's Banque PSA Finance division.
Moody's Investors Service lists the debt at Banque PSA as having the lowest investment grade. It said further on Nov. 14 that it is considering a plan to reduce the rating due to the bank's link to the car-manufacturing parent firm. On Oct. 10, PSA's debt was lowered to three levels below junk at Moody's. On Dec. 15, PSA said that it is near to finalizing a deal with a pool of banks to refinance debt at Banque PSA.
Carole Dupont-Pietri, head of investor relations, said that negotiations with lenders are "on track" and that there should already be an agreement by Christmas. PSA is working to cut 17%, or 11,200 workers, from its French automotive workforce over the next two years. PSA is shutting down a plant on the outskirts of Paris, letting go of assets and developing a vehicle and component alliance with General Motors Co. as Europe's auto market declines this year to its smallest volume since 1995.