Sources Said Peugeot Family Ready to Step Aside for GM image

According to anonymous sources Peugeot’s founding family is willing to give up control of the automaker, in an attempt to revive plans for a tie-up with GM.

Unfortunately any attempt to merge Opel and Peugeot will be attacked with political criticism as this would mean more plant closures and implicitly, job losses in Germany and France. The Peugeot family, which is one of the last three European surviving auto dynasties, turned to 7% shareholder GM after it had sounded out other possible investors, such as Chinese partner Dongfeng.

“GM faces the same overcapacity situation with Opel, and that’s why PSA is trying to convince them to merge the two,” said one of the people, who asked not to be identified because the talks are confidential. “The Peugeot family has now accepted that they’ll lose control, so this is no longer an issue.”

GM recently announced it does not plan to make further investments in its struggling partner PSA Peugeot Citroen. GM, currently owns 7% of Peugeot and in February the two automakers signed a broad-based alliance and GM wrote down almost half of its $423 million investment in the car maker.

“One of the premises of the alliance was, we’ve got to fix our problem, and we’ve addressed it, and continue to make progress,” Akerson said. “They have to address their issues and I think they’re doing that as well.”

Source: Reuters