Opel autoworkers and executives worried that a French takeover will see their pretzels and bratwurst replaced by baguettes and brie can rest easy, or so the automaker looking to buy their company claims.
France’s PSA Group, which could submit a bid to buy Opel and sister division Vauxhall this week, would give the German automaker the autonomy it desperately craves, the company’s CEO told labor reps and Germany’s chancellor.
That elongated “Z” won’t become a fleur-de-lis.
Should the sale of General Motors’ European division go through, PSA, builder of Peugeot and Citroën vehicles, would make Opel-Vauxhall profitable again, Carlos Tavares said. GM, which hasn’t been able to turn a profit from the brands, values its European operations at $2 billion.
Nearly everyone involved with the brand freaked out after learning about the looming sale, but fears of layoffs and plant closures are unfounded, Tavares suggests. PSA would honor existing labor contracts and protect jobs, he claims.
“PSA Chief Tavares emphasized that both businesses complement each other well,” said Steffen Seibert, spokesman for Chancellor Angela Merkel, in a statement. “He affirmed to the chancellor that PSA will maintain Opel’s sovereignty within the group and will assume guarantees on sites, investment and employment.”
As we’ve seen in the recent past with Volkswagen, labor unions hold significant sway over the decisions made by European automakers. To ensure peace, PSA has reportedly sent executives to speak to labor reps and autoworkers across Europe. (Opel has facilities in five countries, while Vauxhall has two plants in the UK.)
“Tavares communicated convincingly in the talks that he is interested in a sustainable development for Opel-Vauxhall as an independent company,” Opel works council Chairman Wolfgang Schaefer-Klug said in a joint PSA-Opel release. “We are ready to explore further the chances of a potential coming together.”
[Source: Bloomberg] [Image: Opel]
Just bend over a little more…thanks
We’ll buy you dinner first and call an Uber for you afterward.
Didn’t BMW say the same thing when they bought Rover?
I think you’re remembering when Mercedes bought Chrysler.
How does PSA buying Opel suddenly make Opel profitable (well, “suddenly” is relative, I suppose…)?
It doesn’t. From all reports, there is a strong imbalance in Opel/Vauxhall between production capacity and sales volume. GM had a (perhaps half-hearted) go at rationalizing production and cuttings costs, and failed in the face of German union and government opposition. PSA would need to be much more successful at this to have any hope of returning the business to profit as an autonomous unit.
Can some one tell me what is it about PSA that will enable it to succeed where GM has failed?
Opel enjoys a lot of autonomy within GM, and feeds the mother ship some product (rebadged Opels = Saturn Astra, Buick Regal, much of successful 2008-2012 Malibu, Saturn Aura) and helps Daewoo…er GM-Korea.
On the other hand, Opel is not peddling rebadged Silverados or Equinoxes.
Yes, GM was bailed out. However, GM makes lots of money selling big vehicles (trucks, SUVs) in (what is still) the world’s most affluent market. So the mother ship has deep pockets.
In Europe, the margins are thinner. Southern Europe has been decimated.
Peugeot has some presence in this mature, weak market, and none in the mature, rich market (USA).
Peugeot has been struggling since the 1990s, when the quotas on Asian cars came off, and the ‘protected’ Latin markets of France, Italy, and Spain, 3 of the top 5 in Euroland, ceased to be “protected”.
So, a weaker company will take over Opel, but it will “honor all commitments” (as it probably must, as a condition of approval by the EU/German govts), their products overlap, and this is good for both companies?
They can combine platforms and/or powertrains, so their overlapping products become different body/interior versions of the same car.
Many have predicted consolidation in the industry. American GM and European Opel aren’t a great mix since they can only share certain models exactly like you said.
I imagine Opel will get “sovereignty” to build cars on PSA platforms and/or develop replacements for less competitive PSA platforms, as the case may be.
Next up: PSA(O?) vs. FCA. So, they’ll have an American presence as well. Let the Americans “independently develop American cars” on the Opel/PSA platforms, as well as design and build light trucks/SUVs.
Oldsmobile gone, Pontiac and Saturn gone. With Opel and Vauxhall gone will GM now become the #4 or #5 car maker or so?
GM is rubbish.
Made even moreso without Opel…
If this can somehow result in some French hot hatches coming over here, that would be a good thing. Not likely, but maybe. We don’t need the Cactus.
There is no way Vauxhall and Opel will continue without cuts and closures, barring some huge miracles. Companies that don’t produce a profit don’t suddenly work more efficiently when they get sold.
This would be just another corporate merger like so many in the past. There’s nothing magical here. If it means more and better choices for more customers, great. More probable is French government money thrown at the situation, and layoffs and closures, and lost European market share taken over by the Koreans and the Chinese.