PSA-Opel marriage sets out to conquer the world

Article by Christian A., on March 23, 2017

PSA seems very confident about conquering the world. The purchase of Opel/Vauxhall for €2.2 billion ($2.3B) from General Motors makes PSA the second largest car company, just behind the Volkswagen Group, but taking over Renault-Nissan’s spot.

Jean-Philippe Peugeot, a family shareholder of PSA, said that they have already discussed a potential acquisition of Opel back in 2012, as early as when the General Motors made a deal with the French company. However, it was not the right time for the marriage of both companies so they waited until this year to announce their plan to the public. He also added in his interview with a German newspaper that PSA wants to go global in the coming years. Thus, the goal was set to “conquer the rest of the world step by step”.

The acquisition includes: Opel/Vauxhall’s automotive operations, the brands they carry, assembly and component manufacturing facilities, an engineering center in Deutschland, and all their employees. Now that Opel is part of the PSA group. It is a big help for the company’s plan to achieve important economies of scale, and this means manufacturing at least three million cars for a core market. Robert Peugeot (Chairman of the PSA Group’s strategy committee) further explained himself and said that “all large carmakers have a volume of three million cars in one important market.

Moreover, it had always been a good idea for the two companies to merge as the Rüsselsheim-based company is doing much better in places where PSA’s sales aren’t doing so well. For instance, the PSA group isn’t getting a lot of sales in the United Kingdom, where Vauxhall, on the other hand is doing well. The same is true in Germany, where the combined sales of Peugeot, Citroën, and DS, are still lower compared to the sales of Opel.

So, Robert believes that the merger will be a win-win situation for both companies as they join forces. He also says that this partnership will not have a negative impact on both ends, including the brands that both companies currently have. He even exclaimed that both companies complement one another.

And just after the announcement, the 2017 Opel Crossland X made its debut in Geneva to celebrate the marriage between PSA and Opel. It flaunted a 2008 Peugeot base, which gives it a more spacious interior. The Crossland X though has the same design as the Mokka X, so people aren’t sure if it was necessary for them to release this model. However, it does offer considerable differences from its French ancestors, with full-LED headlights, sliding rear seats, and a large 520-liter trunk.

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Topics: opel, psa, peugeot, citroen, plan

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