MAR­KETS LIKE IDEA OF A ‘PEUGEOPEL’

The Witness - Wheels - - TRENDS -

IN a move that could shake up the global auto in­dus­try, Gen­eral Mo­tors Co and French au­tomaker PSA Group an­nounced they are in talks that could re­sult in PSA buy­ing GM’s Euro­pean auto op­er­a­tions.

For PSA, owner of the Peu­geot, Citroën and DS brands, ac­quir­ing GM’s Opel and Vaux­hall brands would give it a 16,3% share of the Euro­pean pas­sen­ger car market, vault­ing it into sec­ond place in the re­gion, ahead of French ri­val Re­nault SA and be­hind Ger­many’s Volk­swa­gen AG.

Any deal would have to over­come fi­nan­cial, in­dus­trial and po­lit­i­cal ob­sta­cles. Ger­many’s in­dus­trial union IG Me­tall and Ger­man Econ­omy Min­is­ter Brigitte Zy­pries said it was to­tally un­ac­cept­able that talks took place on French car­maker PSA Group buy­ing GM’s Euro­pean Opel unit with­out con­sult­ing Ger­man works coun­cils or lo­cal gov­ern­ment.

It was not clear what price GM might want for the loss-mak­ing Euro­pean busi­ness, or what struc­ture a deal could take.

Both com­pa­nies cau­tioned in state­ments that no deal is cer­tain, but in­vestors cheered the dis­clo­sure, send­ing shares in PSA, owner of the Peu­geot and Citroën brands, up 3,7% and boost­ing GM shares by 3,5% in early New York trad­ing.

Shares in Fiat Chrysler Au­to­mo­biles NV rose 3,9% as in­vestors spec­u­lated that one con­sol­i­da­tion play could lead to an­other.

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