GM Peugeot announce alliance
#1
GM Peugeot announce alliance
GM and PSA Peugeot Citroën Create Global Alliance
NEW YORK – General Motors and PSA Peugeot Citroën today announced the creation of a long-term and broad-scale global strategic alliance that will leverage the combined strengths and capabilities of the two companies, contribute to the profitability of both partners and strongly improve their competitiveness in Europe.
The alliance is structured around two main pillars: the sharing of vehicle platforms, components and modules; and the creation of a global purchasing joint venture for the sourcing of commodities, components and other goods and services from suppliers with combined annual purchasing volumes of approximately $125 billion. Each company will continue to market and sell its vehicles independently and on a competitive basis.
Beyond these pillars, the alliance creates a flexible foundation that allows the companies to pursue other areas of cooperation.
In connection with the alliance, PSA Peugeot Citroën is expected to raise approximately €1 billion through a capital increase with preferential subscription rights for shareholders of PSA Peugeot Citroën, underwritten by a syndicate of banks and including an investment from the Peugeot Family Group, as a sign of its confidence in the success of the alliance. As part of the agreement, which includes no specific provision regarding the governance of PSA Peugeot Citroën, GM plans to acquire a 7 percent equity stake in PSA Peugeot Citroën, making it the second-largest shareholder behind the Peugeot Family Group.
“This partnership brings tremendous opportunity for our two companies,” said Dan Akerson, GM chairman and CEO. “The alliance synergies, in addition to our independent plans, position GM for long-term sustainable profitability in Europe.”
Philippe Varin, chairman of the managing board of PSA Peugeot Citroën, declared, “This alliance is a tremendously exciting moment for both groups and this partnership is rich in its development potential. 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.”
Under the terms of the agreement, GM and PSA Peugeot Citroën will share selected platforms, modules and components on a worldwide basis in order to achieve cost savings, gain efficiencies, leverage volumes and advanced technologies and reduce emissions. Sharing of platforms not only enables global applications, it also permits both companies to execute Europe-specific programs with scale and in a cost-effective manner.
Initially, GM and PSA Peugeot Citroën intend to focus on small and midsize passenger cars, MPVs and crossovers. The companies will also consider developing a new common platform for low emission vehicles. The first vehicle on a common platform is expected to launch by 2016.
This alliance enhances but does not replace either company’s ongoing independent efforts to return their European operations to sustainable profitability.
The purchasing cooperation defined in the agreement allows the companies to act as one global purchasing organization when it comes to sourcing commodities, components and services from suppliers, taking full advantage of the joint expertise, volume, platforms and standardized parts. Combining GM’s robust global processes and organizational structure with best practices from PSA Peugeot Citroën will bring significant value and efficiencies to the purchasing operations at both companies.
Additionally, the alliance is exploring areas for further cooperation, such as integrated logistics and transportation. To this end, GM intends to establish a strategic, commercial cooperation with Gefco, an integrated logistics services company and subsidiary of PSA Peugeot Citroën, whereby Gefco would provide logistics services to GM in Europe and Russia.
The total synergies expected from the alliance are estimated at approximately $2 billion USD annually within about five years. The synergies will largely coincide with new vehicle programs, with limited benefit expected in the first two years. It is expected the synergies will be shared about evenly between the two companies.
The alliance will be supervised by a global steering committee that includes an equal number of senior leader representatives from each company..
Its implementation is subject to requisite regulatory approvals in certain jurisdictions as well as notification to the appropriate workers councils.
The alliance is structured around two main pillars: the sharing of vehicle platforms, components and modules; and the creation of a global purchasing joint venture for the sourcing of commodities, components and other goods and services from suppliers with combined annual purchasing volumes of approximately $125 billion. Each company will continue to market and sell its vehicles independently and on a competitive basis.
Beyond these pillars, the alliance creates a flexible foundation that allows the companies to pursue other areas of cooperation.
In connection with the alliance, PSA Peugeot Citroën is expected to raise approximately €1 billion through a capital increase with preferential subscription rights for shareholders of PSA Peugeot Citroën, underwritten by a syndicate of banks and including an investment from the Peugeot Family Group, as a sign of its confidence in the success of the alliance. As part of the agreement, which includes no specific provision regarding the governance of PSA Peugeot Citroën, GM plans to acquire a 7 percent equity stake in PSA Peugeot Citroën, making it the second-largest shareholder behind the Peugeot Family Group.
“This partnership brings tremendous opportunity for our two companies,” said Dan Akerson, GM chairman and CEO. “The alliance synergies, in addition to our independent plans, position GM for long-term sustainable profitability in Europe.”
Philippe Varin, chairman of the managing board of PSA Peugeot Citroën, declared, “This alliance is a tremendously exciting moment for both groups and this partnership is rich in its development potential. 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.”
Under the terms of the agreement, GM and PSA Peugeot Citroën will share selected platforms, modules and components on a worldwide basis in order to achieve cost savings, gain efficiencies, leverage volumes and advanced technologies and reduce emissions. Sharing of platforms not only enables global applications, it also permits both companies to execute Europe-specific programs with scale and in a cost-effective manner.
Initially, GM and PSA Peugeot Citroën intend to focus on small and midsize passenger cars, MPVs and crossovers. The companies will also consider developing a new common platform for low emission vehicles. The first vehicle on a common platform is expected to launch by 2016.
This alliance enhances but does not replace either company’s ongoing independent efforts to return their European operations to sustainable profitability.
The purchasing cooperation defined in the agreement allows the companies to act as one global purchasing organization when it comes to sourcing commodities, components and services from suppliers, taking full advantage of the joint expertise, volume, platforms and standardized parts. Combining GM’s robust global processes and organizational structure with best practices from PSA Peugeot Citroën will bring significant value and efficiencies to the purchasing operations at both companies.
Additionally, the alliance is exploring areas for further cooperation, such as integrated logistics and transportation. To this end, GM intends to establish a strategic, commercial cooperation with Gefco, an integrated logistics services company and subsidiary of PSA Peugeot Citroën, whereby Gefco would provide logistics services to GM in Europe and Russia.
The total synergies expected from the alliance are estimated at approximately $2 billion USD annually within about five years. The synergies will largely coincide with new vehicle programs, with limited benefit expected in the first two years. It is expected the synergies will be shared about evenly between the two companies.
The alliance will be supervised by a global steering committee that includes an equal number of senior leader representatives from each company..
Its implementation is subject to requisite regulatory approvals in certain jurisdictions as well as notification to the appropriate workers councils.
#3
Re: GM Peugeot announce alliance
Does everyone else also make this face when they read something with as many lame business buzz words as that has in it?
#5
Re: GM Peugeot announce alliance
The only thing I could think of would be small car architectures potentially. I do not think Peugot's midsizes would end up as GM cars.
The other thing is powertrains. What sort of small gas and diesels does Peugot have that might be decent in Opel/Vauxhalls?
#6
Re: GM Peugeot announce alliance
GM will hand Peaugeot Opel in a few years. It's GM's way to get out of Europe once and for all.
Fiat want's in on the deal.....GM will let them in. Mind you, Fiat got $1 Billion from GM before the bankruptcy for Fiat to LEAVE the partnership. GM is handing over European operations right here, because it's not profitable, and the market is going to crash worse than the U.S. market did.
Fiat want's in on the deal.....GM will let them in. Mind you, Fiat got $1 Billion from GM before the bankruptcy for Fiat to LEAVE the partnership. GM is handing over European operations right here, because it's not profitable, and the market is going to crash worse than the U.S. market did.
#7
Re: GM Peugeot announce alliance
Hmmm. That's quite a prediction. Ceding the entire European operations.
Shedding Opel (which should also mean Vauxhall) is a little different since they do sell other GM brands over there.
Shedding Opel (which should also mean Vauxhall) is a little different since they do sell other GM brands over there.
#9
Re: GM Peugeot announce alliance
What is the quality of a Peugeot parts and manufacturing? Is it something youd stick your name and reputation on? I have no idea. Most of their vehicles dont look that great.
What could possibly be gotten from Peugeot Technology or manufacturing if good quality to offset the 125 Billion buy in investment of the minority of the Shares alone?
What could possibly be gotten from Peugeot Technology or manufacturing if good quality to offset the 125 Billion buy in investment of the minority of the Shares alone?
#10
Re: GM Peugeot announce alliance
At least ford made the fiesta look very similar to the focus.
#11
Re: GM Peugeot announce alliance
That would be impossible because the first order of work is to put the Chevy face on it..
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