PSA and BMW Joint Venture in Question image

Thursday, July 26th, PSA Peugeot Citroen announced it may shift its partnership with BMW to its new alliance partner GM.

PSA has a partnership with BMW for developing and producing parts for hybrid powertrain vehicles, but the company may shift its partnership to GM.

Chief Executive Philippe Varin, testifying before a parliamentary committee, said that “there is a big question about the future of our joint venture with BMW. Within the framework of our alliance with GM we will find another solution.”

Peugeot and BMW’s 18-month old joint venture is called BMW Peugeot Citroen Electrification, and the two companies had plans to invest 100 million euro ($121 million) to produce hybrid and drive technology for plug-in hybrid vehicles. According to the plan the joint venture was to have 400 workers by the end of 2011 at a production plant near Mulhouse, a French city in the east of the country.

But now PSA considers that BMW’s requirements concerning the specifications for the cars which will be sold in the US and China, aren’t coinciding with those of the French company. Since the conditions made 18 months ago are not the same anymore, PSA and BMW are under discussions to solve the issue, if possible.