Is GM Selling Opel to Peugeot?
There appears to be a communication breakdown between General Motors (NYSE:GM), PSA Peugeot Citroen, and the media. While GM said more than once, in simple terms, that its Opel unit was not for sale, the French media said in less simple terms that Peugeot could take over Opel.
Clarification: GM and Peugeot’s current relationship
Almost a year ago, the two auto manufacturers announced an alliance to help both save at least $2 billion within 5 years. Both car makers have been struggling in the current economy, and GM is aiming to return the unit to profitability by the middle of the decade.
What GM has to say:
GM said its European unit, Opel, was not for sale and then was prompted by the French media’s contradiction to say it again, more clearly. General Motors CEO Dan Akerson told reporters at the Detroit Auto Show that “Opel is not for sale” and is “not to be given away either.”
What France is saying:
The French media seemed to be working with many coulds and woulds, with the French newspaper La Tribune stating that Peugeot could take over Opel with GM’s and the French government’s support, that GM would be prepared to make the transaction attractive to Peugeot with a contribution of several billion euros, and that the French state could take a stake in Opel if a deal were struck.
And finally Peugeot’s take on the matter:
A spokesman has said that plans for Peugeot to purchase Opel were not in the GM-Peugeot alliance’s plans, and mentioned GM’s “not for sale” comments.
Conclusion to the confusion
While there may be some foundation for the news story found in La Tribune, as GM is looking to cut its losses at Opel, most of the comments in the story appeared as hypothetical statements and were supported by comments from neither GM nor Peugeot, making it seem most likely that there will be no purchase of Opel and that the two companies will simply continue with their alliance, as is. In short: a lot of media hype, but no substance.