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GM and Peugeot announce alliance | GM and Peugeot announce alliance |
(40 minutes later) | |
General Motors and PSA Peugeot Citroen have announced a global alliance that will see them develop cars together. | General Motors and PSA Peugeot Citroen have announced a global alliance that will see them develop cars together. |
Under the deal, GM will take a 7% stake in Peugeot, making GM the second biggest shareholder in the French firm after the Peugeot family. | Under the deal, GM will take a 7% stake in Peugeot, making GM the second biggest shareholder in the French firm after the Peugeot family. |
The two firms will share engineering development and hope to launch the first common design by 2016. | The two firms will share engineering development and hope to launch the first common design by 2016. |
They hope to save money by combining purchasing and by 2017 they expect to save some $2bn (£1.3bn) a year. | They hope to save money by combining purchasing and by 2017 they expect to save some $2bn (£1.3bn) a year. |
"This partnership brings tremendous opportunity for our two companies," said Dan Akerson, GM's chairman and chief executive. | "This partnership brings tremendous opportunity for our two companies," said Dan Akerson, GM's chairman and chief executive. |
"The alliance synergies in addition to our independent plans, position GM for long-term sustainable profitability in Europe." | "The alliance synergies in addition to our independent plans, position GM for long-term sustainable profitability in Europe." |
Both companies have been struggling in Europe. | Both companies have been struggling in Europe. |
GM's European brand, Opel, brand lost $747m (£472m) last year. | GM's European brand, Opel, brand lost $747m (£472m) last year. |
Despite tough trading conditions Peugeot made a profit of 588m euros ($772m, £492m) in 2011, but that was down 48% on the previous year because of falling sales. | Despite tough trading conditions Peugeot made a profit of 588m euros ($772m, £492m) in 2011, but that was down 48% on the previous year because of falling sales. |
Philippe Varin, chairman of the managing board of PSA Peugeot Citroën said: "With the strong support of our historical shareholder and the arrival of a new and prestigious shareholder, the whole group is mobilized to reap the full benefit of this agreement." | Philippe Varin, chairman of the managing board of PSA Peugeot Citroën said: "With the strong support of our historical shareholder and the arrival of a new and prestigious shareholder, the whole group is mobilized to reap the full benefit of this agreement." |
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