PSA, Europe’s second-largest carmaker, taken over by two governments

 

They make those too

Dongfeng makes those too

As the Chinese New Year (where all of China pretty much shuts down for pretty much a month) edges closer, the deal to provide PSA Peugeot Citroen with a desperately needed capital injection is edging closer. The bottom line is that PSA will be saved by two governments, the French and the Chinese. The French do the deal to preserve jobs and prestige. It will be interesting to see what the Chinese will make out of it. [Continue Reading]

Iran Auto industry Conference: France Goes Back Alone?

China goes where others fear to tread...

China goes where others fear to tread…

In the leadup to last weekend’s Auto Industry International Conference in Tehran, organizers boasted that nearly every nation would be represented, including “France, Japan, Germany, Italy, Turkey, Britain, China, India, Czech Republic, South Korea, Spain, Egypt, Switzerland and Denmark.” In the extended [sic] of one recent official press release, “US automakers are better not to miss the opportunity.”

But miss it they apparently have, along with all the non-French global majors.

[Continue Reading]

France: GM Officials Meeting With Iran

 

Iran so far away...

Iran so far away…

GM’s alliance with PSA Peugeot-Citroen is one of the bigger mysteries of recent automotive history, fusing two badly underperforming operations tied to a market that’s desperate for consolidation. And, sure enough, as time has passed the scope of the alliance has been reduced, GM’s investment has been written down, and even core platform-sharing aspects of the alliance are being left behind. Without a strong justification in the first place, the GM-PSA alliance has now drifted into pure incomprehensibility, leaving analysts scratching their heads and wondering what comes next.

In the absence of even a basic narrative with which to make sense of the GM-PSA dealings, analysis of the situation from France has turned towards anger at GM. Though it has gone totally uncovered in the US media (at least as far as I can tell), French journalists are now alleging that GM’s PSA maneuvers were all about Iran. The allegation, if true, is stunning: that GM’s alliance with PSA was an attempt to wedge the French automaker out of a market it has long dominated, and that with relations thawing between the US and Iran, GM officials have been meeting counterpoints at Iran Khodro to prepare for GM’s re-entry into that market.

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Without the Corsa, GM’s deal with PSA is dead

2010 Opel Corsa Color Race

When, in early 2012, GM bought seven percent of the moribund PSA Peugeot Citroen, with the intent of coupling it with its likewise moribund Opel, just about everybody who understood the car business developed deep lacerations from incessant head-scratching. Combining two sickos usually is not a recipe for health. Unimpressed by logic, the happy couple promised annual cost savings of $2 billion. Now, the deal is entering the terminal phase. [Continue Reading]

PSA and Dongfeng: Beware of Chinese dragon stories

The Dragon Slayer - Picture courtesy wallpaperama.com

Why fight – let’s split the bill instead

 

Gullible blogs reported end of last week that China’s Dongfeng is buying 30 percent of cash-strapped PSA. This after China Business News said that it’s true. Not so fast, said PSA today. The French automaker confirmed that “it is examining industrial and commercial developments with different partners, including the financial implications that would result from them.” However, “none of these projects has reached maturity yet.” [Continue Reading]

Chinese rumors: Dongfeng ready to pay 10 billion for 30 percent of PSA – in Chinese money

Chinese abacus 2 - Picture courtesy ebay.com

It’s interesting to see how different cultures react to the same non-news: In Europe the continuous drip of remarks about a possible partial sale of PSA to China’s Dongfeng is being met with Gallic shrugs, or whatever shrugs they have in other parts of Europe. The blasé EU thinking is that it’s a PR maneuver to cow the French government and the French unions into accepting painful cuts to ward off the yellow peril.  Steve Girsky’s recent remarks to Reuters,  in which he said that GM won’t  be in the way should PSA couple with Dongfeng, fit into this scenario. GM wants the European bleeding stopped, it doesn’t want a new competitor in China.  The Chinese have a completely different view.

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GM won’t object to PSA/Dongfeng tie-up, does not expect a big EU turn-around, has no idea about Bochum cost

Girsky-Akerson Picture courtesy turner.com

Girsky-Akerson Picture courtesy turner.com

Reuters star Detroit reporter Ben Klayman had an interview with GM Vice Chairman Steve Girsky  today, and a few interesting tidbits transpired. Here  they are, bulleted: [Continue Reading]