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The financially strapped Peugeot Citroen group (PSA) views its alliance with General Motors as a must if it’s to survive long term and become a global player.

Speaking to the media at last week’s launch of the Peugeot 2008 SUV in France, the company’s head of communications, Xavier Crespin, admitted that there’s no alternative but to view the GM alliance as a necessity for survival.

“If you want to be considering protecting PSA you have to accept the alliance. It’s the world war and the size of PSA is too small. [So] to have PSA surviving is only with an alliance, only with a bigger group. It’s the best security for PSA.” Crespin said.

PSA-GM

Crespin was vocal about the company’s need for the alliance when CarAdvice asked whether the French government and unions would object to the GM alliance potentially costing jobs in France as the two companies share projects and bring down their cost base.

“I don’t see how government could be putting in risk this alliance and considering that it’s not the only chance for PSA to survive.”

The alliance will bring new technologies to the Peugeot Citroen group, such as much needed automatic transmissions for smaller engines. The two companies plan on creating three new vehicles together as part of projects that come to light by 2016 with potential to share development costs for future powertrains as well.

Like nearly all major European manufacturers, the Peugeot Citroen group lost a considerable amount of money last year ($6.5 billion). The company is rumoured to be considering shutting down a manufacturing plant near Paris.

The Peugeot brand is being revitalized with plans to take the product range further upmarket to increase profit margins. This strategy comes at no surprise, given that BMW and Mercedes-Benz have been enduring the European automotive crisis far better than the mainstream brands.




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