General Motors has moved to stem losses at its European business by announcing plans to take a 7% stake in French rival PSA Peugeot Citroën, in an alliance that will save $2bn (£1.25bn). The world’s largest carmaker will create shared vehicle platforms with Peugeot and a joint purchasing venture that will spend a total of $125bn per year with suppliers.
GM’s chairman and chief executive, Dan Akerson, refused to be drawn on implications for the Ellesmere Port factory on the Wirral, saying it was “way too early” to consider whether the move would affect GM’s capacity plans in Europe.
GM has signalled that Ellesmere Port, where about 2,800 people work on the Astra series, is one of three European plants that could be closed as a consequence of the ongoing review. The review was announced this month as GM posted losses of $747m at its European operations, a result that the company described as “simply unacceptable”.
GM produces 1.4m cars a year in Europe under the Vauxhall and Opel brands and industry sources say it may seek to reduce that number by 400,000 units – the equivalent of two factories.
Peugeot’s Philippe Varin, chairman of the managing board at Europe’s second largest car maker, said: “The overcapacity has to be dealt with independently by each partner. The alliance is not about dealing with capacity. The alliance does not replace what we have to do to sort out the capacity question.” Guradian
