PSA repurchased 10 million of its own shares from Dongfeng, which took a big stake in PSA in 2014 as part of a bailout of the French automaker.

As part of the merger, PSA's 46 percent stake in the supplier will be distributed to all shareholders of the combined company, to be called Stellantis.

The companies will build two plants, one in Germany and one in France, that will be operational starting in 2023. By 2030 the factories will have the capacity to supply a million EVs a year, they said.

The market for sensor technology is expected to explode in the coming decade, outpacing forecasts for global auto production and racing to keep up with the rollout of components like night vision and hands-free steering systems.

The supplier said it is bundling its Car Powertrain and E-Mobility units into one division to "further accelerate the transformation to plug-in hybrids and electric drives." 

The supplier said it could not give detailed financial guidance for the rest of 2020, but said global auto production could fall 10 percent to 20 percent in the third quarter.

The supplier said it's creating a new center of gravity for software-intensive products because of the growing number of safety, performance and comfort features offered by automakers -- and expected by buyers.

Despite a rough few years for Renault, which is now struggling to return to profitability amid the coronavirus crisis, its new CEO is predicting a "surprise turnaround."

PSA CEO Carlos Tavares dismissed a call to revisit the terms of the automaker's merger agreement with Fiat Chrysler, saying the "time has not come to discuss this issue."

Automakers are trying to align their production to new hygiene measures, uncertain demand and the need to reduce inventories that swelled under coronavirus lockdowns.

The EU's competition authorities are said to be scrutinizing PSA's and Fiat Chrysler's European van market share ahead of their pending merger. The automakers have been collaborating on vans for decades.

France will increase the state bonus for consumers buying electric cars to 7,000 euros ($7,680) from 6,000 euros as part of its aid to the country's auto sector, President Emmanuel Macron said.

A factory in Dieppe that builds the Alpine sports car could be closed and the automaker's plant in Flins that makes the Zoe EV and Nissan Micra could be converted to other uses, according to French media reports.

European car buyers still want minicars, for their ease of parking, low cost and fuel efficiency. But automakers say new emissions rules that require costly modifications are making them economically unfeasible. So, how can the key entry-level segment be saved?