Peugeot in talks to buy Opel from General Motors

Anatom

Pretty much guarantees its a done deal, if they're confirming negotiations at this point...

Will this change the quality of Peugeot's cars? Ten/twenty years ago, I'd have said that this would have been brilliant for Peugeot but not sure it'll do anything except harmonise expenses and increase profits.


http://www.irishtimes.com/business/transport-and-tourism/peugeot-in-talks-to-buy-opel-from-general-motors-1.2975110

PSA Group is discussing a potential acquisition of rival European carmaker Opel from General Motors, a spokesman for the French manufacturer said on Tuesday.

“PSA confirms that it is exploring a number of strategic initiatives with GM with the aim of increasing its profitability and operating efficiency, including a potential acquisition of Opel,” company spokesman Bertrand Blaise said.

Sources earlier told Reuters that GM and PSA, owner of brands including Peugeot, were in advanced discussions to combine the Paris-based carmaker with Opel.

Reuters

grogi

Anatom wrote: »

Pretty much guarantees its a done deal, if they're confirming negotiations at this point...

Will this change the quality of Peugeot's cars? Ten/twenty years ago, I'd have said that this would have been brilliant for Peugeot but not sure it'll do anything except harmonise expenses and increase profits.


http://www.irishtimes.com/business/transport-and-tourism/peugeot-in-talks-to-buy-opel-from-general-motors-1.2975110

PSA Group is discussing a potential acquisition of rival European carmaker Opel from General Motors, a spokesman for the French manufacturer said on Tuesday.

“PSA confirms that it is exploring a number of strategic initiatives with GM with the aim of increasing its profitability and operating efficiency, including a potential acquisition of Opel,” company spokesman Bertrand Blaise said.

Sources earlier told Reuters that GM and PSA, owner of brands including Peugeot, were in advanced discussions to combine the Paris-based carmaker with Opel.

Reuters

Wasn't PSA just recently bailed out by French government anyway?

Anatom

grogi wrote: »

Wasn't PSA just recently bailed out by French government anyway?

Well, it was 2014, but yeah, they own 13.7% of it and were apparently thinking about increasing that up to recently.

grogi

Anatom wrote: »

Well, it was 2014, but yeah, they own 13.7% of it and were apparently thinking about increasing that up to recently.

I don't really understand what PSA is looking for in a deal like that. The only thing that might be interesting is the EV know-how gained during Ampera and Bolt development. But I can't imagine GM giving it away.

What's more, a cynic in me tells me that once the Opel is out of GM umbrella, we would see Chevrolet coming back.

Anatom

I agree. Perhaps there's more than just the EV angle but that's all I see as well. I assume they'll keep the separate brands separate for the moment and perhaps there'll be more platform-sharing down the line, but its strange alright. Good move for GM if it happens though.

zilog_jones

Anatom wrote: »

Will this change the quality of Peugeot's cars? Ten/twenty years ago, I'd have said that this would have been brilliant for Peugeot but not sure it'll do anything except harmonise expenses and increase profits.

Is the quality that bad right now? They seem to be making decent cars again (after a bad phase with most of the x07's), but their main problem is really the brand image. Don't know about Citroen though - they seem to be trying to be different again but failing on the execution. The C4 Cactus seems to the only new Citroen I see around and although it looks very unique it doesn't seem particularly well regarded as a car.

Not too sure about Opel either - they're nowhere near as popular as they used to be. Current Corsa and Astra are totally forgettable cars.

How would the brands be pitched in a combined group?
Purgeot vs Citreon vs DS vs Opel/Vauxhall

grogi

zilog_jones wrote: »

Is the quality that bad right now? They seem to be making decent cars again (after a bad phase with most of the x07's), but their main problem is really the brand image. Don't know about Citroen though - they seem to be trying to be different again but failing on the execution. The C4 Cactus seems to the only new Citroen I see around and although it looks very unique it doesn't seem particularly well regarded as a car.

They had their share of issues around timing change in 1.6 THP engines (designed together with BMW)...

But The reliability of cars has increased all over the board and everyone is really comparable.

Market perception is something different - and even if VW is doing things like 2.0 TDI (timing drive) or 1.4 TSI (chain...) that are catastrophic, it does not really impact them too much...

Not too sure about Opel either - they're nowhere near as popular as they used to be. Current Corsa and Astra are totally forgettable cars.

Current Astra is brilliant... I rate it on par, if not better than Golf...

zilog_jones

grogi wrote: »

Current Astra is brilliant... I rate it on par, if not better than Golf...

I'm sure it's a fine car, but it doesn't really stand out from the competition and I don't hear much about it. Last year it was the 12th best selling car in Ireland, sixth in its class - not great but not terrible either. Then again the Peugeot 308 was so low in the list I gave up looking

The buyout could be a good opportunity to cut their ties with the UK (still manufacturing the Astra there IIRC) and ditch the facade that is Vauxhall. PSA already shut down their plant in Ryton (last remnants of the Rootes Group) about 10 years ago.

Anatom

Ooh, Brexit will be blamed for that!

bazz26

I'd say it's probably down to access of additional platforms/technology and increase market share in an attempt to take on the VAG umbrella. Citroen are hardly a big volume seller for PSA and I can see their DS brand being the only future Citroen line up become kind of their sporty brand similar to Seat for VAG.

I wonder will Vauxhall go with Opel or will GM do something else with it?

Anatom

Of course, I'll never forgive GM for what they did, or didn't do, with Saab..!

galwaytt

Tbh i was thinking joining them would lift the quality of Opel.....

colm_mcm

What happens with Vauxhall then?

Q: What a Vauxhall these days? A: a badge over an opel molding.

edburg

Opel owns Vauxhall so would go with with Opel brand if it happens, GM must be struggling again if there considering it. Think they have been using the Opel platforms for there other GM brands.

Hope french don't get to much say in there running, Opel made good strides in quality in recent years.

zilog_jones

colm_mcm wrote: »

What happens with Vauxhall then?

They're still building commercial vehicles in Luton and Astras (80% of which are exported) in Ellesmere Port. If Brexit leads to import tariffs for cars being exported to the EU it could make these plants a lot less feasible. Beyond that it's pure badge engineering.

edburg wrote: »

Think they have been using the Opel platforms for there other GM brands.

Currently, there are two Buick variants of the Insignia being sold in North America, and the Astra and Insignia are being sold as Holdens in Australia. The Opel-based Holdens generally haven't been popular, and they are pretty much doing their own thing (or selling Chevy/Daewoo derivatives) outside of those two.

bazz26

GM also have a partnership with Fiat. Some Fiat diesel engines are fitted to Opel/Vauxhall models. The Corsa and Fiat Grande Punto share the same platform since 2006. I'd imagine if the sale goes through then that partnership would no longer be needed.

grogi

bazz26 wrote: »

GM also have a partnership with Fiat. Some Fiat diesel engines are fitted to Opel/Vauxhall models. The Corsa and Fiat Grande Punto share the same platform since 2006. I'd imagine if the sale goes through then that partnership would no longer be needed.

GM is actually looking to merge with FCA, if they sell the Opel...

zilog_jones

Sure, is there any future for diesel cars anyway?

colm_mcm

grogi

colm_mcm wrote: »

So true...

road_high

Don't get this one. Opel and Peugeot occupy the exact same market space.
What PSA needs is a premium make like VW have with Audi (I appreciate they DS but that's a long way from being credible yet). Not more of the same

road_high

bazz26 wrote: »

I'd say it's probably down to access of additional platforms/technology and increase market share in an attempt to take on the VAG umbrella. Citroen are hardly a big volume seller for PSA and I can see their DS brand being the only future Citroen line up become kind of their sporty brand similar to Seat for VAG.

I wonder will Vauxhall go with Opel or will GM do something else with it?

Citroen are way more popular elsewhere in Europe than here. Don't have the exact figures, but think they're about 1/2 million cars per year sales. Small on their own but they're part of PSA

Arthur Daley

Maybe opel, free of GM can establish themselves as a quality germanic volume car maker to put it up to vw and skoda. Opel was such a popular car up to the mid 80s in Ireland but their products have been so dull under GM for the last 30 years plus.

There was a time peugeot themselves and citroen indeed were considered high quality family motors for the price (504, 505, DS, 2cv). Sloppy electrics and trim and a generalisation about french cars has let them down in the last 15 years.

The vauxhall brand would appear to be living a charmed life now.

colm_mcm

Opel have been under GM control since 1931 though.

Arthur Daley

True, but they and vauxhall probably had more autonomy from GM back in the 60s, 70s early 80s etc. When the european market was more defined and there was less emphasis on the 'world car'

road_high

Arthur Daley wrote: »

Maybe opel, free of GM can establish themselves as a quality germanic volume car maker to put it up to vw and skoda. Opel was such a popular car up to the mid 80s in Ireland but their products have been so dull under GM for the last 30 years plus.

There was a time peugeot themselves and citroen indeed were considered high quality family motors for the price (504, 505, DS, 2cv). Sloppy electrics and trim and a generalisation about french cars has let them down in the last 15 years.

The vauxhall brand would appear to be living a charmed life now.

I think they'll keep it. It's just a badging and marketing brand. Exact same as Opel otherwise.

J.pilkington

edburg wrote: »

, GM must be struggling again if there considering it. Think they have been using the Opel platforms for there other GM

Couldn't be further from the truth!

http://www.freep.com/story/money/cars/general-motors/2017/02/07/gm-2016-profit-sharing/97572540/

GM earns $9.43 billion in 2016; UAW workers get record profit sharing

colm_mcm

Arthur Daley wrote: »

True, but they and vauxhall probably had more autonomy from GM back in the 60s, 70s early 80s etc. When the european market was more defined and there was less emphasis on the 'world car'

What world cars are Opel selling here at the moment?

I know the Karl/Viva is basically a Korean Chevrolet alright.

road_high

J.pilkington wrote: »

Couldn't be further from the truth!

http://www.freep.com/story/money/cars/general-motors/2017/02/07/gm-2016-profit-sharing/97572540/

GM earns $9.43 billion in 2016; UAW workers get record profit sharing

According to what I've read, Opel hadn't made a profit since 1999. So it sounds like the rest of GM is tired of the continual losses.

Sam Russell

colm_mcm wrote: »

Opel have been under GM control since 1931 though.

Vauxhall have been under the control of GM since 1919.

Arthur Daley

Astra and insignia/vectra would have been buicks/chevy/holden even saab. and don't think GM executed this as well as Ford had the focus and mondeo platforms/part shares sorted with mazda/volvo/jag since the mid 90s.

colm_mcm

World car isn't the same as platform sharing.

elperello

I suppose this means Claudia will be retired.

https://www.youtube.com/watch?v=imJNAhljVh4

colm_mcm

Well, she also did work for PSA 20 odd years ago, back when they were selling the Xsara.

edburg

colm_mcm wrote: »

Well, she also did work for PSA 20 odd years ago, back when they were selling the Xsara.

Think we see the real reason PSA are interested

DubDani

Opel are apparently big into EV Development right now, and their current CEO has plans of making them into one of the leading providers of affordable EV vehicles. But it's expensive, and apparently PSA is willing to carry and finance that plan.

grogi

DubDani wrote: »

Opel are apparently big into EV Development right now, and their current CEO has plans of making them into one of the leading providers of affordable EV vehicles. But it's expensive, and apparently PSA is willing to carry and finance that plan.

They are - in current GM strategy Opel should be fully EV by 2030. But it's not that easy - apparently all IP related to EV is outside of Opel - majority belongs to Chevrolet.

Sam Russell

grogi wrote: »

They are - in current GM strategy Opel should be fully EV by 2030. But it's not that easy - apparently all IP related to EV is outside of Opel - majority belongs to Chevrolet.

That is the reason the Saab deal fell through. All the IP created by Saab and built into the model range was transferred to GM and was not available to the new owners of Saab, so they had no model range, so no business.

road_high

I think Opel have been way behind the times on the SUV crossover craze. The Mokka hasn't been enough as it's small compared to the likes of the Quashqui.
The Meriva MPV is stuck in 2003, the market has waned a lot for mini mpvs, same story with the larger Zafira.
Their range is not on song compared with even Peugeot (who have some great new on the pulse new models).
The Corsa is ridiculously long in the tooth, the Insignia has done well considering the shrinking market it competes in.
To top all this off, the premium makes have been eating into the likes of Opel big time- why drive one when for not much more you can drive a "badge"?

elperello

colm_mcm wrote: »

Well, she also did work for PSA 20 odd years ago, back when they were selling the Xsara.

Thanks for that.
Where there's life there's hope!

grogi

elperello wrote: »

Thanks for that.
Where there's life there's hope!

A list of factories to close after the (potencial) merger popped up.

Sam Russell

grogi wrote: »

A list of factories to close after the (potencial) merger popped up.

Could the two UK plants produce enough for the UK market after Brexit? - would get over the probable tariff problem - they make vans and cars.

Nissan could do the same - make UK Nissan cars in Sunderland, and move most production to Hungary. BMW make Mini cars in Oxford, could they move East as well?

Of course, the costs of UK production would rise due to lower volumes, but modern production methods would compensate somewhat - but more robotics would mean less manpower.

colm_mcm

You can't just make all your completely different models for one market in one factory though.

Sam Russell

colm_mcm wrote: »

You can't just make all your completely different models for one market in one factory though.

Well you can actually. You make model A for weeks 1-3, then model B for weeks 4-8, then model C for weeks 9-13, then back to A again. The variations within and between models are easy schedule issues.

Most cars are made from complete sub-assemblies that just slot in - like engine/gearboxes and complete dashboards.

They can reduce the range to just the most popular and import the few others that are low volume.

A 10% tariff is a lot to absorb in a car market unless the marque is high premium, which Opel/PSA are not.

road_high

Sam Russell wrote: »

Well you can actually. You make model A for weeks 1-3, then model B for weeks 4-8, then model C for weeks 9-13, then back to A again. The variations within and between models are easy schedule issues.

Most cars are made from complete sub-assemblies that just slot in - like engine/gearboxes and complete dashboards.

They can reduce the range to just the most popular and import the few others that are low volume.

A 10% tariff is a lot to absorb in a car market unless the marque is high premium, which Opel/PSA are not.

Can you see them do that? They'll just close the least efficient plants regardless of where they are. Brexit seriously undermines any logic there was for a global car maker to keep plants in England, they survive by exporting..

zilog_jones

Apparently Ellesmere Port was kept open because it was running more efficiently than those in Germany - the current Astra is only being produced in England and Poland now. As I said earlier, 80% of their UK production is exported (as of 2012) - it wouldn't make sense at all to keep them going if they weren't going to export anything.

road_high

zilog_jones wrote: »

Apparently Ellesmere Port was kept open because it was running more efficiently than those in Germany - the current Astra is only being produced in England and Poland now. As I said earlier, 80% of their UK production is exported (as of 2012) - it wouldn't make sense at all to keep them going if they weren't going to export anything.

The uk/english car industry is actually hugely export dependent - they tend to view their own cars (both domestic and foreign) as less appealing- Toyota are roundly derided over there. There's very little national brand loyalty like say in France where they rigidly buy "their own" in huge numbers.

Anatom

PSA are trying to placate GM/Vauxhall unions regarding future employment...

Only time will tell if it works.

http://www.reuters.com/article/us-opel-m-a-psa-idUSKBN160100?feedType=RSS&feedName=businessNews

PSA says will honor existing Opel labor agreements
PSA Group (PEUP.PA) will respect existing Opel and Vauxhall labor agreements if it buys the European arm of General Motors (GM.N), PSA and Opel workers' representatives said in a joint statement on Tuesday.

PSA, the maker of Peugeot and Citroen cars, and GM said last week they were in talks over the sale of Opel and sister brand Vauxhall to the French carmaker, sparking concerns in Germany and Britain of job losses and demands for close collaboration with labor leaders.

PSA Chief Executive Carlos Tavares met with representatives of powerful German labor union IG Metall and Opel's European works council on Monday to discuss the impact of any deal on existing sites and jobs.

PSA said it would cooperate with IG Metall and the European works council to jointly set out a path to forge a major European carmaker while safeguarding the future of Opel and its staff.

Some existing labor agreements stretch beyond 2020.

"Tavares communicated convincingly in the talks that he is interested in a sustainable development for Opel/Vauxhall as an independent company ... Thus, we are ready to explore further the chances of a potential coming together," European works council chief Wolfgang Schaefer-Klug said in the statement.

PSA plans to work closely with Opel unions including IG Metall to "find a path to the creation of a European champion with Franco-German roots", the Paris-based company said in an emailed statement.

Germany accounts for about half of Opel's 38,000 staff, while 4,500 are in Britain where Opel operates as Vauxhall.

Two sources close to PSA told Reuters last week that job and plant cuts were part of the tie-up talks, with the two Vauxhall sites in Britain in the front line