Will America Get a Taste of Peugeot With GM’s Help?

General MotorsAs its Chinese operations take off to the point of surpassing the United States, General Motors Co. (NYSE:GM) is contemplating the sale of PSA Peugeot Citroen vehicles in America as part of a potential expansion of the relationship between the two automakers.

GM is already developing products — small cars and minivans — in conjunction with Peugeot, but the deal could see the units being sold stateside under one of GM’s domestic nameplates, La Tribune has reported. Peugeot and GM, which has a 7 percent stake in the former, have said they are exploring areas of further cooperation including possible development or production deals in Latin America and Russia.

Peugeot has been hit hard by its broad exposure to Europe’s suffering automotive market, and has been exploring its options to ensure a degree of financial stability and security. The front running idea, which broke late last month, involves the founding Peugeot family relinquishing control of the company in return for a healthy cash injection.

While that move — which sees GM as being in the best position to take the reigns — would help keep the company’s finances afloat, its hitting some headwinds with the labor unions, which see a further dilution of the Peugeot brand as being seriously detrimental.

“A dilution of the family would not be good news,” a spokesman for Peugeot’s moderate CFTC union said in a Reuters report from June 28th. ”One of the last remaining family groups would cease to exist in its current form,” he added. “It’s the family attachment to the company that has preserved its French roots so far.”

Furthermore, the reasoning behind the union distaste for a buyout goes well beyond losing the company’s French heritage. With Peugeot’s French factories running at 71 percent and Opel’s (GM’s European subsidiary) German plants at 66 percent of maximum output, a tie-up would require politically unsavory closures and firings, Reuters pointed out.

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