The Truth About Cars » PSA http://www.thetruthaboutcars.com The Truth About Cars is dedicated to providing candid, unbiased automobile reviews and the latest in auto industry news. Thu, 11 Sep 2014 17:31:41 +0000 en-US hourly 1 http://wordpress.org/?v=3.9.2 The Truth About Cars is dedicated to providing candid, unbiased automobile reviews and the latest in auto industry news. The Truth About Cars no The Truth About Cars editors@ttac.com editors@ttac.com (The Truth About Cars) 2006-2009 The Truth About Cars The Truth About Cars is dedicated to providing candid, unbiased automobile reviews and the latest in auto industry news. The Truth About Cars » PSA http://www.thetruthaboutcars.com/wp-content/themes/ttac-theme/images/logo.gif http://www.thetruthaboutcars.com On This Day In History: Peugeot Withdraws From U.S. Market http://www.thetruthaboutcars.com/2014/08/day-history-peugeot-withdraws-u-s-market/ http://www.thetruthaboutcars.com/2014/08/day-history-peugeot-withdraws-u-s-market/#comments Wed, 06 Aug 2014 23:17:57 +0000 http://www.thetruthaboutcars.com/?p=883338   On this day in 1991, Peugeot officially announced its exit from the U.S. market. In 1986, Peugeot sold roughly 14,000 cars in America. By 1990, that number had plummeted to just 4,200. PSA still maintains an office in Michigan, but as Peugeot’s exit date closes in on the 25 year mark, that last vestige of a […]

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On this day in 1991, Peugeot officially announced its exit from the U.S. market.

In 1986, Peugeot sold roughly 14,000 cars in America. By 1990, that number had plummeted to just 4,200. PSA still maintains an office in Michigan, but as Peugeot’s exit date closes in on the 25 year mark, that last vestige of a French auto maker presence will likely disappear as well.

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PSA To Cut Labor Costs By Moving More Production Out Of France http://www.thetruthaboutcars.com/2014/05/psa-to-cut-labor-costs-by-moving-more-production-out-of-france/ http://www.thetruthaboutcars.com/2014/05/psa-to-cut-labor-costs-by-moving-more-production-out-of-france/#comments Fri, 23 May 2014 10:00:55 +0000 http://www.thetruthaboutcars.com/?p=828857 PSA will consolidate their small car production at a factory in Slovakia, as the struggling auto maker looks to cut labor costs and increase margins on small cars. Reuters and Automotive News Europe report that the next-generation Citroen C3, the brand’s best-selling model, will be built in Slovakia, alongside the C3 Picasso minivan and the […]

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PSA will consolidate their small car production at a factory in Slovakia, as the struggling auto maker looks to cut labor costs and increase margins on small cars.

Reuters and Automotive News Europe report that the next-generation Citroen C3, the brand’s best-selling model, will be built in Slovakia, alongside the C3 Picasso minivan and the Peugeot 208.

Although the 208 and C3 are currently built at PSA’s Poissy plant as well as in Slovakia, moving them eastward would allow PSA to slash their hourly wage costs, from 57 euros an hour in France, down to 15.50 euros in Slovakia. Lowering labor costs is critical for PSA, as it struggles to regain profitability and reap greater margins on their small cars, which are both unprofitable and PSA’s most popular cars.

Closing any French plant will be fraught with difficulty. Complex labor laws and cultural factors will make closing a plant a political nightmare for PSA – but the economics of Europe’s car market can no longer sustain it.

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PSA, Mitsubishi May End EV Partnership http://www.thetruthaboutcars.com/2014/05/psa-mitsubishi-may-end-ev-partnership/ http://www.thetruthaboutcars.com/2014/05/psa-mitsubishi-may-end-ev-partnership/#comments Thu, 22 May 2014 04:01:03 +0000 http://www.thetruthaboutcars.com/?p=828330 PSA and Mitsubishi may discontinue their electric vehicle partnership in the next 12 months, according to PSA CEO Carlos Tavares. Speaking to a government body related to economic affairs, Tavares said that PSA would be re-evaluating the arrangement, which has PSA selling the Mitsubishi i-MiEV under the Citroen and Peugeot brands. According to Reuters, sales […]

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PSA and Mitsubishi may discontinue their electric vehicle partnership in the next 12 months, according to PSA CEO Carlos Tavares.

Speaking to a government body related to economic affairs, Tavares said that PSA would be re-evaluating the arrangement, which has PSA selling the Mitsubishi i-MiEV under the Citroen and Peugeot brands.

According to Reuters, sales of the PSA branded EVs are down dramatically, from a combined 6,222 units in 2013 to 1106 in 2014. Despite this, Tavares cited the strength of the yen as a possible factor for the partnership’s fate.

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Chart Of The Day: Europe’s C-Segment In 2013, And Why Peugeot Isn’t Coming Back To America http://www.thetruthaboutcars.com/2014/04/chart-of-the-day-europes-c-segment-in-2013-and-why-peugeot-isnt-coming-back-to-america/ http://www.thetruthaboutcars.com/2014/04/chart-of-the-day-europes-c-segment-in-2013-and-why-peugeot-isnt-coming-back-to-america/#comments Tue, 29 Apr 2014 15:09:24 +0000 http://www.thetruthaboutcars.com/?p=812386   Today’s chart of the day comes courtesy of JATO Dynamics and Automotive News Europe, showing last year’s C segment car sales in Europe (click to enlarge). While ANE reported the data in the context of the Volkswagen Golf’s (undeniable) dominance of the C-segment, the remaining data provides a lot of insight into the global automotive […]

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Today’s chart of the day comes courtesy of JATO Dynamics and Automotive News Europe, showing last year’s C segment car sales in Europe (click to enlarge).

While ANE reported the data in the context of the Volkswagen Golf’s (undeniable) dominance of the C-segment, the remaining data provides a lot of insight into the global automotive landscape.

  • Per JATO, Ford sold about 223,000 units of the Focus in Europe last year – but in the United States alone, they sold 234,570. What does that say about the strength and size of the American market (where compacts are a big segment, but dwarfed by mid-size sedans, pickup trucks and CUVs), or the relative smallness of Europe’s market, which has substantially more brands and nameplates vying for a smaller piece of the pie
  • Vauxhall/Opel may be struggling to stay afloat, but the Astra is a perpetually strong seller for the brand, while the Chevrolet Cruze doesn’t even rank in the top 10. Then again, the different Golf variants (SEAT Leon, Skoda Octavia) are absent too.
  • Both Toyota and Honda have a lower profile in Europe than in America, but the Auris seems to have resonated strongly with European consumers. Not only is it beating the Peugeot 308 and Citroen C4, but also the Hyundai i30 (Elantra GT) and Kia Cee’d, which have been giving VAG a fright in key markets like the Czech Republic, as well as winning critical acclaim from the European motoring press. The Civic languishes in 10th place, selling about 50,000 units. You can bet that Nissan is looking to pick it off as it prepares to ramp up its own C-segment entrant.
  • Combined sales of the PSA twins (Peugeot 308 and Citroen C4) add up to about 178,000 units, while Hyundai and Kia’s combined sales equal about 185,000 units. Would you have expected this to happen a decade ago? If anything, it shows why the blogosphere talk of PSA returning to America is bunk (nevermind that it was merely wish fulfillment based on comments by CEO Carlos Tavares taken out of context). PSA doesn’t even have their house in order at home. They aren’t going to spend billions to return to a market that likes to buy the kind of products they don’t build.
  • Back to the Auris. It’s coming here as a Scion. And it’s supposed to be a great driving car. On the other hand, there won’t be a Toyota-badged car to replace the Matrix.

 

 

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Tavares Could Take Reins at PSA Peugeot Citroen in March http://www.thetruthaboutcars.com/2014/01/tavares-could-take-reins-at-psa-peugeot-citroen-in-march/ http://www.thetruthaboutcars.com/2014/01/tavares-could-take-reins-at-psa-peugeot-citroen-in-march/#comments Mon, 27 Jan 2014 12:00:41 +0000 http://www.thetruthaboutcars.com/?p=724730 Sources close to the situation tell Reuters that Carlos Tavares, Carlos Ghosn’s former second in command at Renault, could start running rival PSA Peugeot Citroen as soon as March. Tavares officially joined PSA as CEO-in-waiting on Jan. 1. According to Reuters, Peugeot had previously said only that Tavares would take over sometime this year. Peugeot […]

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Sources close to the situation tell Reuters that Carlos Tavares, Carlos Ghosn’s former second in command at Renault, could start running rival PSA Peugeot Citroen as soon as March. Tavares officially joined PSA as CEO-in-waiting on Jan. 1. According to Reuters, Peugeot had previously said only that Tavares would take over sometime this year. Peugeot Chairman Thierry Peugeot told Le Figaro in an interview published over the weekend that the company’s board of directors would soon decide on the official transition date.

“Some observers had thought Tavares could take over by Feb. 19 when Peugeot announces its annual results. That was the plan … but Philippe Varin wants to remain in his post until the Chinese president visits France in March,” said one of the sources. “Given that Varin played an important role in the Dongfeng deal, it is completely possible that the replacement can wait until March.”

The Chinese president, Xi Jinping will make his first state trip to Europe in March, to meet with China’s trading partners after a year of trade tensions with the EU.

Dongfeng, a state-owned Chinese automaker, has agreed to join the French government in taking minority stakes in PSA, and will be investing $4.1 billion in the French automaker. The Peugeot board has agreed in principle to the deal, which would result in the Peugeot family losing control of the company.

Peugeot needs a source of cash to develop new product and stay competitive as sales decline in its core market of Europe. It also wants to expand the relationship with Dongfeng. The two companies currently operate a joint venture assembling cars in China. Dongfeng and PSA have been in discussions to expand their cooperative work to other Asian countries.

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Renault Eyeing Return To Iran When Sanctions Lift http://www.thetruthaboutcars.com/2014/01/renault-eyeing-return-to-iran-when-sanctions-lift/ http://www.thetruthaboutcars.com/2014/01/renault-eyeing-return-to-iran-when-sanctions-lift/#comments Fri, 24 Jan 2014 18:18:40 +0000 http://www.thetruthaboutcars.com/?p=707522 For the past few months, sanctions against Iran for their nuclear ambitions have sidelined PSA and Renault from the Persian market. Behind the scenes, General Motors outmaneuvered PSA despite their one-time alliance allowing them to muscle their way into aan emerging market via loophole abuse and an unknown quantity of Camaros. With GM out of the […]

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Renault Tondar 90. Picture courtesy of Iran Khodro

For the past few months, sanctions against Iran for their nuclear ambitions have sidelined PSA and Renault from the Persian market. Behind the scenes, General Motors outmaneuvered PSA despite their one-time alliance allowing them to muscle their way into aan emerging market via loophole abuse and an unknown quantity of Camaros. With GM out of the way, however, PSA would now be free to regain their footing once sanctions were lifted.

PSA won’t be alone in the upcoming battle, of course, as their compatriots at Renault have plans to return to Iran to reclaim what was lost, and then some.

At the World Economics Forum in Davos, Switzerland this week, Renault-Nissan CEO Carlos Ghosn announced that Renault would be willing to return to Iran once sanctions were lifted so as to capitalize on the potential 50 percent growth in sales. Currently, the sanctioned market represents between 700,000 to 800,000 vehicles, but could explode to between 1 million and 1.5 million units by the end of the 2010s once the market is freed, benefiting both Renault and PSA due to the popularity of French brands in Iran.

Renault’s departure from the Iranian auto market early last year, was out of fear of non-compliance of the sanctions issued against Iran by the United States, consequences of which would have led to Nissan having a tough time as far as U.S. sales were concerned. The pullout cost Renault 64,500 units worth of sales in the nation — 40,000 less than predicted by French newspaper La Tribune back in late July 2013 — and a first-half provision of $698 million that contributed to a 95 percent plunge in net income from Persian sales in the same period.

The vehicles sold in Iran by Renault consisted of Dacia Logan variants built locally from component kits in a partnership with local manufacturer ICKO.

With the noted presence of Iranian President Hassan Rouhani at the annual Davos gathering, Ghosn is confident that the “well-engaged” discussions about resuming international ties between Iran and the West are a sign of good things to come for his company, and for all others waiting to stake a claim. Iran’s auto market is expected to explosively to 1 million units, or 50 percent larger than Australia’s own market, by 2020.

Not that Tehran is waiting, of course.

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GM Sells PSA Peugeot Citroen Stake For A $150 Million Gain, Blesses Dongfeng/PSA Tie-Up http://www.thetruthaboutcars.com/2013/12/gm-sells-psa-peugeot-citroen-stake-for-a-150-million-gain-blesses-dongfengpsa-tie-up/ http://www.thetruthaboutcars.com/2013/12/gm-sells-psa-peugeot-citroen-stake-for-a-150-million-gain-blesses-dongfengpsa-tie-up/#comments Fri, 20 Dec 2013 10:00:45 +0000 http://www.thetruthaboutcars.com/?p=684290 General Motors sort of has a reputation for bad investments in Europe. In 2000, GM made a deal with Fiat wherein Fiat sold 20% of Fiat Auto to GM for $2.4 billion and the Italian automaker took a 6% stake in GM. GM also received a put option which in certain circumstances would have obligated […]

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GM CEO Dan Akerson and PSA CEO Phillipe Varin when the tie-up between their two companies was announced in 2012. Now, Akerson and Varin are both on their way out and GM has sold its 7% stake in PSA, though the companies continue to jointly work on some projects.

GM CEO Dan Akerson and PSA CEO Phillipe Varin when the tie-up between their two companies was announced in 2012. Now, Akerson and Varin are both on their way out and GM has sold its 7% stake in PSA, though the companies continue to jointly work on some projects.

General Motors sort of has a reputation for bad investments in Europe. In 2000, GM made a deal with Fiat wherein Fiat sold 20% of Fiat Auto to GM for $2.4 billion and the Italian automaker took a 6% stake in GM. GM also received a put option which in certain circumstances would have obligated the largest American car company to exercise that option and buy the rest of Fiat. In 2005, to get out of that deal, GM paid Fiat another $2 billion.

 

With that kind of history, it’s not surprising that when GM invested $400 million in early 2012 for a 7% share of French automaker PSA Peugeot Citroen many skeptics expected GM to lose money on that deal as well. PSA’s stock prices dropped after GM’s buy-in and in the fourth quarter of last year, GM took a $220 million charge on its books to bring the PSA investment down to market value. GM announced last Friday that it sold its ~24.8 million shares in PSA to institutional investors for $343 million. As a result of all that accounting the Detroit automaker will realize a net gain of $150 million, posted to the company’s fourth quarter earnings as a special item.

A day before GM announced their divestment of PSA shares, the two companies said they had reduced projected annual cost savings from their alliance to $1.2 billion by 2018, down from an earlier projection of $2 billion in savings by 2017. The companies will continue to work jointly on two vehicles based on PSA platforms, a joint purchasing and logistics venture, and also work together on a new small light commercial vehicle.

GM said that their sale of PSA shares was not related to the French concern’s announcement last week that it is exploring a possible capital increase and and considering commercial and industrial projects with partners. One of those partners is Chinese automaker Dongfeng Motor Group. Dongfeng and PSA recently said they would be exchanging 20% stakes after the Chinese company agreed to inject over $2 billion in PSA. Chinese media reports say that prior to its sale of PSA shares, GM gave it’s blessing to the alliance between the French and Chinese automakers.

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GM Selling PSA Stake http://www.thetruthaboutcars.com/2013/12/gm-selling-psa-stake/ http://www.thetruthaboutcars.com/2013/12/gm-selling-psa-stake/#comments Thu, 12 Dec 2013 18:17:34 +0000 http://www.thetruthaboutcars.com/?p=678810 General Motors will sell off their 7 percent stake in PSA, but will continue joint developing select vehicles and technologies. In a statement, GM’s Steve Girsky said “Our equity stake was planned to support PSA in their efforts to raise capital at the time of the creation of the GM and PSA alliance, and that […]

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General Motors will sell off their 7 percent stake in PSA, but will continue joint developing select vehicles and technologies. In a statement, GM’s Steve Girsky said

“Our equity stake was planned to support PSA in their efforts to raise capital at the time of the creation of the GM and PSA alliance, and that support is no longer needed,” said GM Vice Chairman Steve Girsky. “The alliance remains strong with our focus on joint vehicle programs, cross manufacturing, purchasing, and logistics.  We’re making good progress while remaining open to new opportunities.”

GM and PSA will continue to develop a small MPV type car and a small crossover, while working together on commercial vehicles.

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Iran Is Open For Business: 1.5 Million Annual Unit Sales At Stake http://www.thetruthaboutcars.com/2013/11/iran-is-open-for-business-1-5-million-annual-unit-sales-at-stake/ http://www.thetruthaboutcars.com/2013/11/iran-is-open-for-business-1-5-million-annual-unit-sales-at-stake/#comments Tue, 26 Nov 2013 18:21:15 +0000 http://www.thetruthaboutcars.com/?p=664114 Weeks prior to the historic deal reached between Iran and the “P5+1″ group of nations, TTAC reported on some of the machinations going on behind the scenes regarded the United States, France and their respective auto industries ability to do business in Iran. We put forth the theory that any deal with Iran would be […]

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Weeks prior to the historic deal reached between Iran and the “P5+1″ group of nations, TTAC reported on some of the machinations going on behind the scenes regarded the United States, France and their respective auto industries ability to do business in Iran. We put forth the theory that any deal with Iran would be a boon to auto manufacturers, who would have access to a market expected to be worth 1.5 million units in a few short years, with a very young population and a standard of living that is substantially better than many highly touted emerging markets.

At the time of publication, we encountered significant dismissal, if not disagreement. But as it turned out, negotiations had been ongoing since the start of 2013, and the preliminary deal appears to make the auto industry a big winner.

Within the next 6 months, the auto industry is expected to inject as much as $500 million into Iran. The auto industry, currently worth over 1 million units annually, will be a hotly contested ground for foreign firms looking to break into the market.

Despite apparently being muscled out of Iran by their alliance with General Motors, PSA’s arrangement with GM is now as good as dead, and that means that PSA has the chance to claw their way back to the top of Iran’s market. Last year, PSA sold nearly 458,000 units in Iran (CKD kits which are being erroneously referred to as spare parts kits). Renault, which sold roughly 100,000 Logans in Iran last year, will also be able to resume business.

But American firms also appear to have designs on Iran’s auto market, with French firms becoming increasingly concerned that American companies are trying to muscle them out of Iran. Speaking to Just-Auto, an unnamed official from IKCO, PSA’s former partner in Iran, said

“This is a new day for automakers. More than [just] previous partners, we can also host more automakers which are interested to come to invest in the automotive sector of Iran.”

French officials have previously asserted that GM’s desire to have PSA end its relationship with IKCO was a way to clear out Iran’s auto market prior to the resumption of trade between the two countries. Indeed, the sanctions regime, as well as pressure from GM, caused Renault and PSA respectively, to withdraw from Iran – leaving a 585,000 unit hole in a 1.2 million unit marketplace.

Previous TTAC reports have outlined how GM officials have been clandestinely meeting with Iranian officials via intermediaries – at the time it appeared to be in violation of sanctions, but new information, asserting that high-level talks between the two countries had been going on since early 2013, have given those discussions some legitimacy.

But now, Iran is open for business not just for GM or any other American firm, but auto makers in Germany, Italy and beyond. The broader questions – whether the deal between Iran and the West is a good one, or whether it’s worth negotiating such a deal in return for the associated economic opportunities – are best left for another arena. What’s germane to our discussion is the future of Iran’s auto market and who stands to benefit.

A foothold, if not outright dominance, of a major emerging market is substantial prize for any automaker forced to compete in a mature global market with an over-saturation of brands and increasing need for volume and scale. Prior to the deal, auto makers were looking to Indonesia, South Africa  and other markets that are substantially poorer, with lesser prospects for growth. The BCG report on emerging markets even shied away from speculating on Iran due to political instability. But all of a sudden, Iran is now open for business, and by the end of the decade, its auto market is expected to be 50 percent larger than Australia’s. It’s unclear which auto makers will rush in to this market. But Iran appears to be wasting no time.

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PSA Hires Ex-Renault COO Tavares As Next CEO http://www.thetruthaboutcars.com/2013/11/psa-hires-ex-renault-coo-tavares-as-next-ceo/ http://www.thetruthaboutcars.com/2013/11/psa-hires-ex-renault-coo-tavares-as-next-ceo/#comments Tue, 26 Nov 2013 16:45:37 +0000 http://www.thetruthaboutcars.com/?p=663874 PSA confirmed that former Renault COO Carlos Tavares will take over the reins starting January 1st. Tavares assumes the role at a fortunate point in time for PSA: an alliance with Chinese car maker Dongfeng is underway, and Tavares’ predecessor, Philippe Varin, has already completed the difficult task of closing factories and cutting thousands of […]

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PSA confirmed that former Renault COO Carlos Tavares will take over the reins starting January 1st. Tavares assumes the role at a fortunate point in time for PSA: an alliance with Chinese car maker Dongfeng is underway, and Tavares’ predecessor, Philippe Varin, has already completed the difficult task of closing factories and cutting thousands of jobs, a difficult task in a country like France.

Now, Tavares will be tasked with helping PSA turn things around, with a slate of new product, a leaner organization and  reorganized brand structure. Despite Varin laying much of the groundwork for a potentially revitalized PSA, Tavares could end up in the right place at the right time – able to fulfill his dream of running a car company, while presiding over a successful turnaround.

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Iran’s Imported Chevrolet Camaros Raise Questions About GM’s Dealings With PSA And The Iranian Regime http://www.thetruthaboutcars.com/2013/11/irans-imported-chevrolet-camaros-raise-questions-about-gms-dealings-with-psa-and-the-iranian-regime/ http://www.thetruthaboutcars.com/2013/11/irans-imported-chevrolet-camaros-raise-questions-about-gms-dealings-with-psa-and-the-iranian-regime/#comments Thu, 07 Nov 2013 14:26:41 +0000 http://www.thetruthaboutcars.com/?p=644722 An obscure story in the Azerbaijani press this past summer may be the tip of a much larger iceberg involving General Motors, PSA Peugeot Citroen and the Western World’s current bete noir: the Iranian regime currently embroiled at the heart of a controversial nuclear program, which is subject to economic sanctions by the United States government, […]

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An obscure story in the Azerbaijani press this past summer may be the tip of a much larger iceberg involving General Motors, PSA Peugeot Citroen and the Western World’s current bete noir: the Iranian regime currently embroiled at the heart of a controversial nuclear program, which is subject to economic sanctions by the United States government, including those that specifically target Iran’s automotive industry.

Citing reports from Iran’s Mehr news agency, an Azerbaijani news outlet reported that an unspecified number of brand new Chevrolet Camaro RS 2LT convertibles were imported by a division of Iranian conglomerate Iran Khodro. According to the report, the Camaros were sent from Miami to Paris, and then from Paris to Tehran via a Qatar Airways plane. The report also states that US Customs and Border Patrol documents list the final destination as the Aras Free Trade and Industrial Zone.

Iran Khodro, which manufactures automobiles in Iran, is among the Iranian industrial entities that has been hit hard by American sanctions against Iran, including those that specifically target its auto industry, which some parties allege is a “major procurement network that imports material and technologies used to build uranium centrifuges instead of cars.

Given the serious penalties for violating sanctions against Iran, it seems unthinkable at first glance that General Motors vehicles would be exported to Iran for sale without any consequences. GM even stipulated that PSA suspend doing business with Iran and IKCO as part of its alliance agreement with PSA, an agreement that seems to have stalled at this point. But a deeper dive into the matter reveals a much more complex picture, one that sheds more light on GM’s future positioning in emerging markets, its dealings with Iran itself, and what may be the true nature of its alliance with PSA.

The ties between PSA and IKCO have historically been very strong. Most of IKCO’s cars were Peugeot vehicles of varying ages, branded as Iran Khodro or Peugeot vehicles, and built in Iranian factories. In a market of 1.12 million units annually, IKCO had production capacity for a million units per year, with IKCO and PSA’s joint venture ruling the vast majority of those sales, while their factories ran very close to capacity in previous years. PSA alone accounted for roughly 458,000 units sold in Iran, while PSA rival Renault also had a strong interest in Iran, selling 100,000 units per year, until it withdrew from the country, citing fears of violating U.S sanctions as a reason for walking away from the Iranian market.

Now, various French news outlets, including Le Figaro, a respected daily newspaper, are accusing General Motors of intentionally gutting PSA’s ability to do business in Iran, while attempting to establish its own partnership with IKCO, as a means of securing a strong footing in the up and coming Iranian market, one that Boston Consulting Group estimates is good for 1.5 million units per year by 2020, making it one of the strongest of the “Beyond BRIC” countries.

Le Figario states that

Iranian automotive industry is particularly courted by General Motors . The giant came into contact with Iran Khodro, which worked until 2012 with Peugeot to produce 206 and 405 models that the French group has stopped delivering to Iran because of Western sanctions imposed on Tehran for its nuclear ambitions . “For at least six months as emissaries of General Motors go to Iran, they are no longer the simple identification of the market,” warns the industry, “but rather to the draft contract resumption of GM “, which was firmly established in the time of the Shah.

Le Figaro alleges that GM is not the only company to be looking to Iran if and when relations between America and Iran thaw amid a resolution over its nuclear crisis, but it does call out an ad campaign on behalf of GM undertaken by an Iranian law firm – other reports also point to a social media campaign designed to target Iranian consumers on behalf of GM. Other allegations leveled at GM include the use of emissaries on behalf of GM visiting Iran and IKCO as part of a broader push to undermine established French business interests in favor of American companies in preparation for the resumption of commercial dealings with Iran. One source cited by Le Figaro doesn’t think that this was a mere coincidence. The source claims that Executive Order 13645 is

“…a real cleansing of the Iranian car market as it prepares to make way for U.S. manufacturers before a political deal between Tehran and Washington.”

Upon closer examination, sale of the Camaros appears to be allowed under a loophole in Executive Order 13645 , which punishes any foreign entity that sells or supplies parts or services to Iran’s automotive industry (specifically its manufacturing sector) but does not prohibit supplying Iran with assembled vehicles.

During the initial stages of the tie-up, the alliance between GM and PSA was difficult to discern. Beyond vague platform sharing and purchasing agreements, there seemed to be few synergies that made such an alliance worthwhile. By the Iranian angle adds context to the entire affair.

By putting pressure on PSA to end its relationship with IKCO, GM gave America a way to keep the heat on Iran’s economy while also cutting off an artery for hard currency via reduced vehicle exports. At the same time, it was able to cripple an already ailing partner by cutting it off from one of its better export markets, and a growing one at that. Before the alliance had even been former, our own global sales reports showed that sanctions and other economic factors had been effective at gutting Iran’s automotive market, composed largely of locally built IKCO/PSA products. The departure of Renault was another positive development for GM, with the French auto maker walking away from 100,000 units annually. Altogether, the absence of the two French players leaves a 585,000 unit hole in Iran’s nearly 1 million strong auto market, one that GM is primed to capitalize on if and when things get less frosty and trade relations between the two countries open up .

Many observers feel that Iran’s Islamic regime is living on borrowed time, thanks to a relatively young population that is plugged into Western popular culture – these same people came very close to toppling the regime just a few years ago. And while regime change doesn’t seem to be in the cards anymore, then the very sanctions designed to bring the regime to its knees might at least foment some sort of normalization of relations in exchange for the forfeiture of Iran’s nuclear program, along with a new, more moderate ruler (though Iran’s unelected religious leaders still hold all the power). Such vast numbers of young people with rising economic prospects and families of their own on the horizon will be perfect consumers for a large number of automobiles in the future, and who better to serve them than General Motors?

The timing is likely to be fortuitous, as Iran’s auto market is expected to grow by another 500,000 units, to roughly 1.5 million units by the end of the decade. GM’s push won’t be centered around Camaros either. The General has a number of Chinese brands selling cheap, compact vehicles that can go head to head with Chinese brands like Great Wall that are already established in Iran. If GM really does make a big push into Iran, brands like Wuling and Baojun will be just as important as Chevrolet and Buick, and will likely be part of an attempt to capture a substantial amount of volume by utilizing multiple brands in GM’s portfolio to help capture various market segments from compact low-cost cars to flashier fare to the smaller commercial vehicles that brands like Wuling are known for.

Platform sharing, the oft reported cause of death of the GM-PSA alliance, may have been a red herring all along. GM could possibly have decided to abandon the alliance, or any pretense of it, after getting what they came for: in this case, an express pass to a promising emerging market that isn’t a BRIC country. But don’t count PSA out just yet. Recent talks with Chinese auto maker Dongfeng could allow it to get back in the game in Iran, free of any concerns about violating U.S. sanctions.

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PSA: Business Model for Joint Small Car With GM “Just Wasn’t There” http://www.thetruthaboutcars.com/2013/10/psa-business-model-for-joint-small-car-with-gm-just-wasnt-there/ http://www.thetruthaboutcars.com/2013/10/psa-business-model-for-joint-small-car-with-gm-just-wasnt-there/#comments Thu, 24 Oct 2013 11:00:32 +0000 http://www.thetruthaboutcars.com/?p=632802 In the wake of news that China’s Dongfeng Motors is going to take an equity stake in PSA/Peugeot Citroen, the French automaker says that it is scaling back its alliance with General Motors, which owns 7% of PSA. PSA said that a planned joint subcompact platform that was seen as the basis of the tie-up with […]

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The next Citroen C3 and Peugeot 208 will not share a platform with Opel's Corsa as originally planned

The next Citroen C3 and Peugeot 208 will not share a platform with Opel’s Corsa as originally planned

In the wake of news that China’s Dongfeng Motors is going to take an equity stake in PSA/Peugeot Citroen, the French automaker says that it is scaling back its alliance with General Motors, which owns 7% of PSA. PSA said that a planned joint subcompact platform that was seen as the basis of the tie-up with GM will probably be cancelled. “Further analysis showed that the business model just wasn’t there,” a PSA spokesman said. Financial statements released by PSA say that anticipated savings of $1 billion due to synergies with GM will be adjusted downward.

The cancelled platform was supposed to have underpinned replacements for the Peugeot 208, Citroen C3 and Opel Corsa. Barclay’s analyst Kristina Church said that a common small car was “absolutely key” to the partnership.”It certainly seems GM has no focus on the alliance with Peugeot any more. They don’t want to be partnered with a struggling company, and they have alternative methods to turn things around [in Europe],” Church said.

Still, GM and PSA spokesmen said that the alliance is going forward. “We have other projects under review. Some projects are not economically feasible, which is why they are dropped, but we’re taking the projects one-by-one and examining their economic feasibility first,” a PSA rep said. The companies will still produce a jointly developed small minivan at GMs Zaragoza, Spain factory starting in 2016. “We are moving forward with the implementation” of the projects which have already been agreed upon, Ulrich Weber said for GM.

The deal with GM was originally a main part of PSA CEO Philippe Varin’s strategy to turnaround the struggling French carmaker. Working with a company of GM’s size was seen as a way of reducing costs. After GM took a 7 percent stake in PSA in February, 2012 the automakers announced plans for at least five joint vehicle and powertrain programs. However, soon afterwards, GM revealed that SAIC, it’s partner in China could veto some of the plans.

Remaining are the upcoming small minivan and another joint vehicle development program working on a crossover, along with joint purchasing. PSA did say that so far joint purchasing has saved the company about 60 million euros so far this year.

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Beyond The BRICs http://www.thetruthaboutcars.com/2013/10/beyond-the-brics/ http://www.thetruthaboutcars.com/2013/10/beyond-the-brics/#comments Wed, 23 Oct 2013 12:30:02 +0000 http://www.thetruthaboutcars.com/?p=632226 Emerging markets have been a big theme at TTAC for the past few years, with our coverage going beyond the cursory articles on automotive developments in the BRIC countries. Our articles on places like North Africa and Indonesia aren’t always the most popular, but we keep an eye on them for a very important reason. […]

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Emerging markets have been a big theme at TTAC for the past few years, with our coverage going beyond the cursory articles on automotive developments in the BRIC countries. Our articles on places like North Africa and Indonesia aren’t always the most popular, but we keep an eye on them for a very important reason. These countries are the final frontier for growth in the automotive sector.

Boston Consulting Group released a report that urges auto makers to look beyond the BRICs, to a group of 88 countries that contain roughly 40 percent of the world’s population. Collectively, annual growth of 6 percent is expected, below India’s 10 percent, but on par with China and outpacing both Brazil and Russia.

Rather than cover all 88 nations, BCG identified the “Future 15″ countries where car sales are expected to show strong increases in sales (Iran, Turkey, Saudi Arabia, the Ukraine, Indonesia, South Korea, Thailand, Malaysia, Taiwan, Mexico, Argentina, Colombia, Chile, South Africa and Algeria), as well as four regional areas that will serve not only as sales hot spots, but also as future locations for assembly plants, R&D and sourcing. Not surprisingly, these are based in North Africa, the ASEAN region, the Middle East and the Andean region in South America.

The need for specific regional strategies is a key theme in the report, with BCG devoting plenty of space to the need for product, financing and sourcing solutions that are best adapted to regional characteristics. Among their examples are the importance of offering a vehicle with a low tax burden in the Middle East, a tailor-made financing plan for Latin American consumers from Chevrolet and Renault’s North African assembly efforts for its Dacia brand.

One of the more interesting examples highlighted by the report was that of the ASEAN countries. Toyota is overwhelmingly dominant in Indonesia, its biggest market, and one possible reason is because of its ability to build products at an appropriate price-point that strongly resonate with local buyers. A side by side comparison between the Japanese market Sienta MPV and the Indonesian Avanza shows how this is done.

On the surface, the two seem indistinguishable, but under the skin, they are vastly different cars. The Sienta rides on a platform shared with the Yaris, while the Avanza uses a rugged, body-on-frame rear-drive layout with increased ground clearance, to handle Indonesia’s rougher roads and frequent flooding. Its powertrain and interior are much less advanced, and the Avanza has fewer creature comforts. But it’s built to a price, costing as much as $5,000 less than a Sienta, a fact that’s reflected in the slab-sided body panels, which are easier and cheaper to stamp. This kind of specialization is what’s allowed Toyota to capture 90 percent of Indonesia’s market, giving them an enormous head start in what is expected to be the next big place to sell cars.

ASEAN is not the only region where Toyota enjoys the top spot. The auto maker is leading slightly in volume in the Middle East, though second-place Kia is essentially equal in terms of market share. Chevrolet is regarded as the leader in the Andean belt, while Renault and Dacia are tops in North Africa. While Korean OEMs also have a strong showing, both Renault and Peugeot are strong in the Middle East and Africa, even as their efforts falter in Europe.

The common thread with all of this is an emerging middle class in regions where that notion did not exist. With prosperity on the rise, they are eager to attain greater mobility and freedom though an automobile of their own. Along with personal transportation comes the possibility of good jobs in assembly plants, sales and after-sales, logistics and other related industries. Renault and Dacia have begun to look to North Africa as a regional hub not only for the African market, but for the Middle East and even Europe. Nissan’s Datsun brand is one of the first to explicit target the “Beyond BRIC” countries, with stated aims to expand into Indonesia and Africa in the near future.

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Reuters: Dongfeng/PSA Tie-Up Resulted From GM Scaling Back Cooperation http://www.thetruthaboutcars.com/2013/10/reuters-dongfengpsa-tie-up-resulted-from-gm-scaling-back-cooperation/ http://www.thetruthaboutcars.com/2013/10/reuters-dongfengpsa-tie-up-resulted-from-gm-scaling-back-cooperation/#comments Tue, 15 Oct 2013 14:58:58 +0000 http://www.thetruthaboutcars.com/?p=624193 Reuters is reporting that the reason behind PSA/Peugeot Citroen’s financial tie-up with China’s Dongfeng Motors was the decision of General Motors, which owns 7% of the French automaker, to scale back cooperation with Peugeot. GM also apparently rejected a PSA/Opel merger backed by the French government. In February of 2012, GM announced its investment in […]

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Reuters is reporting that the reason behind PSA/Peugeot Citroen’s financial tie-up with China’s Dongfeng Motors was the decision of General Motors, which owns 7% of the French automaker, to scale back cooperation with Peugeot. GM also apparently rejected a PSA/Opel merger backed by the French government.

In February of 2012, GM announced its investment in PSA as part of what was publicized as a broad based partnership. However, the relationship had problems only months later when GM announced that Shanghai Automotive (SAIC), its partner in China, vetoed some of the joint GM-PSA product planning.

Also, in June of this year, Peugeot had arranged approval from the French government for a restructuring that involved a merger with GM’s European Opel division, but the Detroit based automaker disapproved the deal. The less than smooth relationship with GM persuaded Peugeot CEO Philippe Varin to find other financial partners, ending in the reported $4 billion capital investment in PSA by Dongfeng and the French government. If that deal goes through, the holdings of GM would be diluted and the Peugeot family, which currently owns a bit more than a quarter of its shares, would no longer control the firm.

In exchange for the investment, Dongfeng will get access to PSA’s technology and markets.

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PSA CEO Varin Says French Carmaker to Deepen Ties With Dongfeng in China. GM’s Girsky Unconcerned http://www.thetruthaboutcars.com/2013/09/psa-ceo-varin-says-french-carmaker-to-deepen-ties-with-dongfeng-in-china-gms-girsky-unconcerned/ http://www.thetruthaboutcars.com/2013/09/psa-ceo-varin-says-french-carmaker-to-deepen-ties-with-dongfeng-in-china-gms-girsky-unconcerned/#comments Mon, 30 Sep 2013 15:12:31 +0000 http://www.thetruthaboutcars.com/?p=531769 PSA/Peugeot-Citroen is negotiating with China’s Dongfeng Motor to expand their partnership in the world’s largest car market. PSA CEO Philippe Varin told reporters attending the opening of a new factory in Shenzhen, China, on Saturday that the French company is seriously considering selling equity to Dongfeng to fund expansion outside of Europe. The sale could diminish […]

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PSA/Peugeot-Citroen is negotiating with China’s Dongfeng Motor to expand their partnership in the world’s largest car market. PSA CEO Philippe Varin told reporters attending the opening of a new factory in Shenzhen, China, on Saturday that the French company is seriously considering selling equity to Dongfeng to fund expansion outside of Europe. The sale could diminish the holdings of the Peugeot family, which holds slightly more than a quarter of PSA shares, below a controlling stake in the French automaker. Earlier this year, Reuters had reported that the Peugeots were willing to relinquish control so that GM could take a larger stake in PSA, though General Motors has since indicated that they don’t plan to increase their holdings in PSA.

PSA now has three factories in China under a joint venture with Dongfeng and Varin was in China for the launch of their fourth Chinese facility, a joint venture with the Chang’An Automobile Group in the southern Chinese city of Shenzhen where PSA will locally assemble the luxury DS series. Including the new factory PSA will have capacity to build almost a million cars a year in China, more than double last year’s sales of 442,000 units in the country.

Responding to the news about a financial tie-up between PSA and Dongfeng, General Motors’ vice chairman Steven Girsky said that the deal involving Dongfeng taking an equity stake in PSA would not affect GM’s partnership with PSA. “We’re not PSA’s only partner so I don’t think it would complicate our situation any more than it would complicate some of their other partners,” Girsky said in New York on Friday. GM bought a 7% stake in PSAas part of its plan to right its European operations.

Girsky said that the affect of the PSA-Dongfeng capital relationship on GM’s own tie-up with PSA would ultimately depend on how much influence the Chinese automaker had on the partnership and on where the vehicles jointly  made by PSA and Dongfeng would be sold.

The GM vice chairman reaffirmed GM’s position that right now it will keep it’s investment in PSA at 7% of the equity of the French company. “We bought our 7 percent in the first place not because we wanted significant influence in PSA, but because we wanted to help them with their capital raise at the time,” he said.

Girsky said that the priority of the alliance with PSA is fixing GM’s European operations not finance. GM and PSA have previously announced that they will be jointly developing a minvan platform and it’s been reported that GM would like PSA and Opel to be somewhat integrated.

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PSA, Dongfeng Said To Be Exploring A Partnership http://www.thetruthaboutcars.com/2013/09/psa-dongfeng-said-to-be-exploring-a-partnership/ http://www.thetruthaboutcars.com/2013/09/psa-dongfeng-said-to-be-exploring-a-partnership/#comments Wed, 18 Sep 2013 17:22:07 +0000 http://www.thetruthaboutcars.com/?p=523009 PSA, parent company of Peugeot and Citroen, is said to be exploring a partnership with China’s Dongfeng, as Peugeot looks for ways to strengthen itself amid weak sales and a perpetually sputtering European car market. A number of solutions are being proposed, with France’s La Tribune claiming that a capital increase (with Dongfeng providing cash in exchange […]

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PSA, parent company of Peugeot and Citroen, is said to be exploring a partnership with China’s Dongfeng, as Peugeot looks for ways to strengthen itself amid weak sales and a perpetually sputtering European car market.

A number of solutions are being proposed, with France’s La Tribune claiming that a capital increase (with Dongfeng providing cash in exchange for equity), as well as an emerging market joint venture where Dongfeng would also be holding much of the equity, with Peugeot getting the financial resources it needs to expand in the developing world.

Complicating matters is the brand’s alliance with General Motors. GM has a 7 percent stake in PSA and is seen within the company as a key to helping PSA pull through the European crisis, where overcapacity and a need for significant economies of scale are hurting smaller players like PSA. But PSA also wants to follow the lead of rival Renault-Nissan, which has aggressively expanded in emerging markets with Dacia (a runaway success) and now Datsun. Europe is considered a mature market, and emerging markets are one of the only growth sectors left for an established auto maker like PSA (especially given that a North American expansion is off the table, even though it is also a strong market for automobiles).

Currently, the Peugeot family holds roughly 25 percent of PSA’s shares, but any deal with Dongfeng could see them lose their stake – an unthinkable occurrence in past eras.

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American Sanctions Forced Renault Out Of Iran http://www.thetruthaboutcars.com/2013/07/how-sanctions-forced-renault-out-of-iran/ http://www.thetruthaboutcars.com/2013/07/how-sanctions-forced-renault-out-of-iran/#comments Fri, 26 Jul 2013 16:37:07 +0000 http://www.thetruthaboutcars.com/?p=497141 Following PSA’s exit from Iran last year, Renault is the latest French car maker to leave the Middle Eastern country, thanks to American derived sanctions. La Tribune reports that Renault will stand to lose about 100,000 units worth of sales in Iran, with variants of the Dacia Logan making up the bulk of their volume. Renault […]

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Dacia_Logan

Following PSA’s exit from Iran last year, Renault is the latest French car maker to leave the Middle Eastern country, thanks to American derived sanctions.

La Tribune reports that Renault will stand to lose about 100,000 units worth of sales in Iran, with variants of the Dacia Logan making up the bulk of their volume. Renault built the cars locally in a joint-venture with IKCO (also a partner of PSA), with Renault holding a 51 percent stake.

Renault’s Carlos Tavares cited American sanctions on trade with Iran as a driving force behind the decision. Violating the sanctions would have had major implications for Renault-Nissan, namely difficulties doing business in the United States. While PSA’s exit was largely blamed on pressure from alliance partner General Motors, Renault’s own decision to leave appears to be motivated solely by the consequences of non-compliance.

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PSA, GM Discussing A Return For Peugeot And Citroen Products In The USA http://www.thetruthaboutcars.com/2013/07/psa-gm-discussing-a-return-for-peugeot-and-citroen-products-in-the-usa/ http://www.thetruthaboutcars.com/2013/07/psa-gm-discussing-a-return-for-peugeot-and-citroen-products-in-the-usa/#comments Wed, 10 Jul 2013 13:50:10 +0000 http://www.thetruthaboutcars.com/?p=494756 No, the headline is not just empty click-bait. According to La Tribune, GM and PSA are looking at bringing some current Peugeot and Citroen products to America. The only catch is that they’d be commercial vans. The Citroen Jumpy and Peugeot Expert, the two vans in question, are currently built in a joint venture with Fiat due […]

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No, the headline is not just empty click-bait. According to La TribuneGM and PSA are looking at bringing some current Peugeot and Citroen products to America. The only catch is that they’d be commercial vans.

The Citroen Jumpy and Peugeot Expert, the two vans in question, are currently built in a joint venture with Fiat due to expire in 2017. PSA is looking for a replacement solution, and with GM currently buying vans from Nissan (their NV vans are going to be sold as Chevrolets), it would be advantageous for GM to take advantage of their alliance with PSA and get something out of the deal.

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Peugeot Working On 1700 LB Hot Hatch Good For 135 MPG http://www.thetruthaboutcars.com/2013/07/peugeot-working-on-1700-lb-hot-hatch-good-for-135-mpg/ http://www.thetruthaboutcars.com/2013/07/peugeot-working-on-1700-lb-hot-hatch-good-for-135-mpg/#comments Fri, 05 Jul 2013 15:27:13 +0000 http://www.thetruthaboutcars.com/?p=494284 Still glowing from their win at Pikes Peak, Peugeot is about to show off something completely different; a 135 mpg B-segment car (on the European cycle) that can still break the automotive Mendoza Line and hit 60 mph in 8 seconds. The 208 FE as its known, is a pretty radical car compared to a […]

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peugeot_208_fe_rear_static_0. Photo courtesy AutoExpress.co.uk

Still glowing from their win at Pikes Peak, Peugeot is about to show off something completely different; a 135 mpg B-segment car (on the European cycle) that can still break the automotive Mendoza Line and hit 60 mph in 8 seconds.

The 208 FE as its known, is a pretty radical car compared to a base 208; Peugeot took a 1.0L 208 (0-60 time of 14 seconds in standard trim) and replaced most of the bodywork with aerodynamically enhanced carbon fiber panels. Also helping to save weight and space are a 5 gallon fuel tank (compared to the standard car’s 13 gallon unit) and a carbon “blade” which replaces the springs, shocks and anti-roll bars both front and rear. All told, this cuts 440 pounds out of the car, bringing weigh down to 1705 pounds. Even the brakes have been uprated to solid caliper Alcon units solely to allow for less effort when slowing the car down.

On the powertrain front, the stock 1.0L engine gets a bump up to 1.2L – horsepower hasn’t been disclosed, but the concept car made 68 horsepower. Not very much, but considering the car’s weight, as well as the 40 pony boost from the on-board hybrid system (from the Peugeot 908 HDi LeMans car), the car has a pure electric range of between 9 to 12 miles. Power is routed through a 5 speed automated manual gearbox.

The end result is 135 continental mpgs and just half the CO2 emissions of a Prius (a mere 49 grams per kilometer). Peugeot won’t be putting this car into production, but the one-off example will be driveable. From a technological standpoint, there’s a lot to like about this car; a lightweight “warm hatch” that has decent performance but astounding fuel economy. Even with all of the modern hybrid and carbon fiber tech onboard, the 208 FE probably delivers similar numbers to something like a Peugeot 205 GTI (said to hit 60 mph in 7.6 seconds) while being exponentially more efficient. Does it deliver the same purity behind the wheel? I doubt it. But that’s not its mission either. The 208 FE is an interesting exercise in building an extremely fuel efficient car that isn’t a rolling advertisement for one’s proclivity to shop at a food co-op. Based on that alone, I wouldn’t kick it out of bed for eating wheat germ crackers.

peugeot_208_fe_rear_suspension peugeot_208_fe_brakes peugeot_208_fe_interior peugeot_208_fe_rear_static_0. Photo courtesy AutoExpress.co.uk peugeot_208_fe_front_static

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PSA On The Death-Bed: Worth More Dead, Or Cut Up Into Parts? http://www.thetruthaboutcars.com/2013/07/psa-on-the-death-bed-worth-more-dead-or-cut-up-in-parts/ http://www.thetruthaboutcars.com/2013/07/psa-on-the-death-bed-worth-more-dead-or-cut-up-in-parts/#comments Fri, 05 Jul 2013 15:16:44 +0000 http://www.thetruthaboutcars.com/?p=494285 Imagine (sorry) you are on your death-bed, surrounded by your friends and families, who are divided in two camps. One group bets big on how soon you will die. The other group calculates how much your body-parts will bring after you are cut up. Now you know how PSA poor Peugeot Citroen must feel. According […]

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Death bed - Picture courtesy CNN.com

Imagine (sorry) you are on your death-bed, surrounded by your friends and families, who are divided in two camps. One group bets big on how soon you will die. The other group calculates how much your body-parts will bring after you are cut up. Now you know how PSA poor Peugeot Citroen must feel.

According to Reuters, the battered PSA stock jumped 8 percent yesterday after Goldman Sachs said the company is worth more than the €6.7 a share, if one would “focus on a SOTP (sum of the parts) valuation.” Usually, the whole is supposed more than the sum of the parts, but in the perverted world of financial double-speak, SOTP valuation means the parts could be worth more than the sum. That seems to be the case here. The market is betting that Peugeot is being broken up and sold by the piece.

Until yesterday, the market was betting big that PSA would croak.  Says Reuters: “Hedge funds have been betting on falls in Peugeot’s shares, making it one of the biggest short-selling targets in Europe in the past year. According to data from Markit, 10.2 percent of Peugeot shares outstanding are out on loan.”

So what would you be saying if you overhear the discussions of the two camps by your sickbed? I know what I would say: “Nurse, crank up the Morphine.”

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Sebastian Loeb Shatters Pikes Peak Record, Gives PSA Something To Celebrate http://www.thetruthaboutcars.com/2013/07/sebastian-loeb-shatters-pikes-peak-record-gives-psa-something-to-celebrate/ http://www.thetruthaboutcars.com/2013/07/sebastian-loeb-shatters-pikes-peak-record-gives-psa-something-to-celebrate/#comments Tue, 02 Jul 2013 18:18:07 +0000 http://www.thetruthaboutcars.com/?p=493967 It’s been a bad week for PSA, but at least they’ve got something to celebrate about. French driver Sebastian Loeb, behind the wheel of a Peugeot 208 T16, broke the record for the fastest time up Pikes Peak, at 8 minutes, 13.878 seconds, beating the old record by 92.286 seconds. The 208 T16, which bears […]

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Sébastien-Loeb-and-Peugeot-Shatter-Record-at-Pikes-Peak-placement-626x382. Photo courtesy CarandDriver.comIt’s been a bad week for PSA, but at least they’ve got something to celebrate about. French driver Sebastian Loeb, behind the wheel of a Peugeot 208 T16, broke the record for the fastest time up Pikes Peak, at 8 minutes, 13.878 seconds, beating the old record by 92.286 seconds.

The 208 T16, which bears no mechanical resemblance to the 208 road car, pushes 875 horsepower through all four wheels. Peugeot is no stranger to Pikes Peak – nearly a quarter century ago, a Ari Vatanen attacked the mountain in a 405 T16. Loeb, who has traditionally driven Citroen cars in WRC, has leapfrogged over Vatanen to cement himself as one of the legends of the course. Dare I say he may even be the most complete driver of all time? Somewhere, Ken Block is plotting a way to steal the limelight back from Loeb.

 

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On Its Beggathon, PSA Bypasses Fiat http://www.thetruthaboutcars.com/2013/07/on-its-beggathon-psa-bypasses-fiat/ http://www.thetruthaboutcars.com/2013/07/on-its-beggathon-psa-bypasses-fiat/#comments Tue, 02 Jul 2013 16:39:27 +0000 http://www.thetruthaboutcars.com/?p=493941 France’s PSA has been all over the world with hat in hand, looking for a charitable donation that may keep the carmaker alive a little longer. Things are so dire that it is news when PSA does not ask a carmaker for a donation. That carmaker is Fiat, itself short of funds. Asked by Reuters […]

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France’s PSA has been all over the world with hat in hand, looking for a charitable donation that may keep the carmaker alive a little longer. Things are so dire that it is news when PSA does not ask a carmaker for a donation. That carmaker is Fiat, itself short of funds.

Asked by Reuters if he had held talks with the Peugeot family, Fiat Chairman John Elkann said: “No.” However, Elkann made indications that he might take Peugeot if it’s really, really cheap:

“As we’ve said before, certainly if we were presented with an interesting opportunity, we would be open to considering it,” 

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Peugeot Family Willing To Relinquish Control Of PSA To GM http://www.thetruthaboutcars.com/2013/06/peugeot-family-willing-to-relinquish-control-of-psa-to-gm/ http://www.thetruthaboutcars.com/2013/06/peugeot-family-willing-to-relinquish-control-of-psa-to-gm/#comments Thu, 27 Jun 2013 15:35:11 +0000 http://www.thetruthaboutcars.com/?p=493438 Mired in the same overcapacity crisis as the rest of Europe’s auto makers, the founding family of PSA is reportedly willing to give up control of the company that owns Peugeot and Citroen in exchange for a fresh infusion of capital from GM, which currently owns 7 percent of PSA. Terms of the deal are […]

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Mired in the same overcapacity crisis as the rest of Europe’s auto makers, the founding family of PSA is reportedly willing to give up control of the company that owns Peugeot and Citroen in exchange for a fresh infusion of capital from GM, which currently owns 7 percent of PSA.

Terms of the deal are unclear, but PSA is sustaining heavy losses as European car sales have tanked. Unlike arch rival Renault, PSA has no low cost cars to help attract emerging market consumers and value-oriented buyers in Europe.

The Peugeot family still holds a 25 percent stake in the company and retains roughly 38 percent of the voting rights. But the family is reportedly comfortable with the idea of giving up control, according to a Reuters source

“GM faces the same overcapacity situation with Opel, and that’s why PSA is trying to convince them to merge the two,” said one of the people, who asked not to be identified because the talks are confidential. “The Peugeot family has now accepted that they’ll lose control, so this is no longer an issue.”

The news outlet reports that nothing concrete would happen until after September’s German elections. Any deal with Peugeot would undoubtedly result in major job losses and factory closures in France, Germany or another European country, which makes any tie-up extremely politically sensitive. But given the prospect of GM absorbing yet another ailing European brand, deep cuts will be an inevitable part of the consolidation of PSA.

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GM Good News: No More Investments Into PSA http://www.thetruthaboutcars.com/2013/06/gm-good-news-no-more-investments-into-psa/ http://www.thetruthaboutcars.com/2013/06/gm-good-news-no-more-investments-into-psa/#comments Wed, 19 Jun 2013 13:32:15 +0000 http://www.thetruthaboutcars.com/?p=492657 We can’t help it that there is so much crummy news about GM, but here is something decidedly positive: GM  “has no plans to make additional investments in its French partner PSA Peugeot Citroen SA which is subject to the depressed European automobile market,” Dow Jones Newswire says via NASDAQ. The wire heard it from […]

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We can’t help it that there is so much crummy news about GM, but here is something decidedly positive: GM  “has no plans to make additional investments in its French partner PSA Peugeot Citroen SA which is subject to the depressed European automobile market,” Dow Jones Newswire says via NASDAQ. The wire heard it from Dan Akerson himself, so it must be true.

A year ago, in an alliance of the walking wounded, GM bought 7 percent of  limping PSA. Since then, GM had to write down a good deal of that so-called investment.

PSA faces a European Union investigation triggered by the French government providing financial support for Peugeot’s financing arm.

The probe could derail a loan-guarantee package agreed to by France in October.

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French Paper: PSA Low On Cash http://www.thetruthaboutcars.com/2013/05/french-paper-psa-low-on-cash/ http://www.thetruthaboutcars.com/2013/05/french-paper-psa-low-on-cash/#comments Wed, 29 May 2013 13:07:23 +0000 http://www.thetruthaboutcars.com/?p=489934 PSA Peugeot Citroen told Reuters it is not true that it is low on cash, and that it needs  to ask shareholders for an infusion. France’s La Tribune says that Peugeot is looking at a capital raise after burning through 2.5 billion euros ($3.23 billion) of cash in the past year. “A capital increase is […]

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PSA and partners - Picture courtesy popsop.com

PSA Peugeot Citroen told Reuters it is not true that it is low on cash, and that it needs  to ask shareholders for an infusion. France’s La Tribune says that Peugeot is looking at a capital raise after burning through 2.5 billion euros ($3.23 billion) of cash in the past year.

“A capital increase is not on the agenda since the financial security of the group … is at a high level and was reinforced in the first quarter by the success of bond issues,” a PSA spokesman told Reuters, pointing to the 7.3 billion euros in cash reserves and 3.2 billion in undrawn lines of credit the group had as of the end of last year.

PSA, a partner of GM, does not expect a return to profit until 2015. Peugeot entered wage negotiations with the unions.

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