Reports: GM, PSA ponder a deeper tie-up
 | Steve Girsky, interim head of GM Europe, reiterated this month that General Motors has no plan to sell Opel. |
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General Motors and PSA Peugeot Citroen are exploring ways to combine their European operations in a second phase of the alliance they forged earlier this year, sources said.
One option is for GM's Opel European unit to merge with PSA's automotive operations in a joint venture, Reuters and the French newspaper La Tribune reported, citing sources who asked not be identified because the discussions are confidential.
GM could take a 30 percent stake in the joint venture and inject up to $10 billion into the new company, a source familiar with GM's thinking told Automotive News Europe.
By taking a 30 percent stake, GM would not have to consolidate Opel's financial results, thus limiting the U.S. automaker's biggest financial liability, the source said.
In February, GM and Peugeot forged an alliance for joint purchasing of parts and to share vehicle platforms for the development of several future vehicles.
A person with knowledge of the talks told Automotive News that discussions about a deeper tie-up began within weeks of the alliance's being signed. The companies have explored different scenarios for combining operations to eliminate costs, including a sale of Opel to Peugeot, a sale of Peugeot's automotive division to GM and other combinations, the source said.
For months, GM CFO Dan Ammann and other executives have been sharing financial data with their Peugeot counterparts, including detailed information on labor costs for plant workers and engineers, the source said.
"There's too much capacity, not just assembly plants but also white-collar workers," the source said. "This would be a way to take two companies and turn it into one and get rid of a lot of those resources."
Spokespersons for GM and PSA declined comment.
"We're focused on earning the benefits of our alliance with PSA that we have identified," a GM spokesman said.
The companies have said that within five years they expect to share at least $2 billion in annual savings from the purchasing and product-development alliance.
GM, Ford Motor Co., Fiat-Chrysler, Nissan-Renault and other mass-market automakers have seen losses in Europe accelerate amid a worsening economy there exacerbated by the continent's debt crisis. GM has lost more than $16 billion in Europe since 1999, including a $617 million loss during the first half of this year.
GM Vice Chairman Steve Girsky has been working on a restructuring plan for Europe since he was appointed chairman of Opel's supervisory board nearly one year ago. In July, GM CEO Dan Akerson named Girsky interim head of GM Europe following the reassignment of Karl-Friedrich Stracke.
Girsky reiterated this month that GM has no plans to sell Opel, following reports that Fiat-Chrysler CEO Sergio Marchionne had an interest in acquiring it.
Mike Colias contributed to this report
You can reach Luca Ciferri at lciferri@crain.com.
