After 88 years integrated in the American giant General Motors, Opel will have a clear French accent, as part of the PSA group. Group where the Peugeot, Citröen, DS and Free 2 Move brands are already present (supply of mobility services).
The deal, valued at 2.2 billion euros, makes PSA the second largest European car group, just behind the Volkswagen Group, with a share of 17.7%. Now with six brands, the total volume of cars sold by Grupo PSA is expected to grow by around 1.2 million units.
For PSA, it should bring huge benefits in economies of scale and synergies in purchasing, production, research and development. Especially in the development of autonomous vehicles and new generation of powertrains, where costs can be amortized over a much larger number of vehicles.
Led by Carlos Tavares, PSA hopes to achieve annual savings of 1.7 billion euros in 2026. A significant part of that amount should be reached by 2020. The plan involves restructuring Opel in the same way that it did for PSA.
We recall that Carlos Tavares, when he took over at the top of PSA, found a company on the brink of bankruptcy, followed by a state rescue and partial sale to Dongfeng. Currently, under his direction, PSA is profitable and achieving record profitability. Similarly, PSA expects Opel/Vauxhall to achieve an operating margin of 2% in 2020 and 6% in 2026, with operating profit being generated as early as 2020.
A challenge that can prove difficult. Opel has accumulated losses since the beginning of the century amounting to nearly 20 billion euros. The forthcoming cost reduction could mean tough decisions such as plant closures and layoffs. With the acquisition of Opel, the PSA Group now has 28 production units spread across nine European countries.
European champion – create a European champion
Now that the German brand is part of the group's portfolio, Carlos Tavares aims to create a group that is a European champion. Between cutting expenses and combining development costs, Carlos Tavares also wants to explore the appeal of a German symbol. One of the goals is to improve the group's global performance in markets reluctant to acquire a French brand.
Other opportunities open up for PSA, which also sees possibilities for Opel's expansion beyond the borders of the European continent. Taking the brand to the North American market is one of the possibilities.
After the initial agreement in 2012 for the joint development of models, we will finally see the first completed model in Geneva. The Opel Crossland X, the crossover successor to the Meriva, uses a variant of the Citroen C3 platform. Still in 2017, we should get to know the Grandland X, an SUV related to the Peugeot 3008. From this initial agreement, a light commercial vehicle will also be born.
It's the end of Opel at GM, but the American giant will continue to collaborate with PSA. Agreements were drawn up to continue the supply of specific vehicles for the Australian Holden and the American Buick. GM and PSA are also expected to continue to collaborate on the development of electric propulsion systems, and potentially, PSA could gain access to fuel cell systems from the resulting partnership between GM and Honda.