MARKETS LIKE IDEA OF A ‘PEUGEOPEL’
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.