Malaise-Merger: Opel And PSA To Be Combined
Think of it as a merger of the equally sick: PSA’s automotive division (Peugeot Citroen) and Opel could be put into one company, a joint venture between GM and PSA, La Tribune reports with Reuters providing the translation.
Neither company had a comment. According to the “secret plan,” GM would bring fewer cars to the deal, but would inject cash. The proposal is likely to run into objections from the French government and has yet to be submitted to the Peugeot board, the report added.
La Tribune sees few synergies in a link-up. Both companies are focused on the same market Europe, and compete in similar segments. Both lack presence in growth markets. Combining Europe’s second largest carmaker PSA with Opel would not even create a carmaker larger than Volkswagen.
Bertel Schmitt comes back to journalism after taking a 35 year break in advertising and marketing. He ran and owned advertising agencies in Duesseldorf, Germany, and New York City. Volkswagen A.G. was Bertel's most important corporate account. Schmitt's advertising and marketing career touched many corners of the industry with a special focus on automotive products and services. Since 2004, he lives in Japan and China with his wife <a href="http://www.tomokoandbertel.com"> Tomoko </a>. Bertel Schmitt is a founding board member of the <a href="http://www.offshoresuperseries.com"> Offshore Super Series </a>, an American offshore powerboat racing organization. He is co-owner of the racing team Typhoon.
More by Bertel Schmitt
Comments
Join the conversation
I can't believe the Peugeot family would go for this, although they do have much less control over the company than, say, the Fords do over theirs, so they might not be able to stop it. At any rate, they're probably less emotionally involved in the car business, since Peugeot as a company predates the automobile division by quite a few years, so it's not their original industry. Also, this does seem to have shades of what's been going on in the American beer industry. Molson + Coors = Molson Coors; SAB + Miller = SABMiller; SABMiller + Molson Coors = MillerCoors. Now, we'll have PSA + Opel, and if it works well, Fiat and Chrysler probably won't be far behind.
This is frankly a terrible idea, merging two sick companies almost never works. In 1954 amid great fanfare Studebaker and Packard merged. The merger was a complete failure, Packard ended up trying to sell a rebadged Studebaker as a Packard; Packard ceased to exist after 1958; Studebaker struggled for a few more years before pulling the plug on automobile production in December 1963. I see a similar outcome for Opel and PSA if the companies merge.
@pch101- You apparently can only understand simple ideas. 28-cars-later displays an understanding of some of the complexities involved. You assume to know GM because of a brief stint as a financial intern in a field office years ago but betray astoundingly shallow understanding of the company or the car business. Bean counters are universally decried as the cause of many corporate declines. GM along with Ford and Chrysler, was weakened by external factors, particularly adversarial government policies such that the financial crisis of '08 pushed 2/3 of the industry into bankruptcy. You can feel as smug as Joe Biden in your simplistic attack on me and any one of millions of GM people, who worked for a company that failed, but it really doesn't make you look very bright.
No excuses, just reasons.