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Peugeot Looks to GM as Potential White Knight

GM plays hard-to-get after past alliances all floundered.

by on Jun.28, 2013

Despite the addition of new products like the 3008 diesel-hybrid, Peugeot continues to stumble as the European slump drags on.

After more than 200 years in control of the company that still bears its name, the Peugeot family appears willing to cede control of PSA Peugeot Citroen in a bid to attract a white knight to rescue the fast-failing French automaker.

And with several potential partners, including Chinese carmaker Dongfeng, showing a notable lack of interest, Peugeot CEO Philippe Varin is now sounding out General Motors, according to several reports from Europe.  GM and Peugeot announced an alliance in early 2012 that the makers claimed would save them billions of dollars over the coming year through common purchasing, parts production and other efforts. But the proposal coming from the French maker would take things a significant step further.

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Like Peugeot, GM has been hard hit by the European economic crisis and recently announced the latest in a series of turnaround plans for its Continental operations – which have lost more than $16 billion in 13 consecutive years of red ink – including $1.8 billion in 2012. But with European car sales now dipping to their lowest levels in two decades, analysts are skeptical about how quickly it will be able to implement that plan.

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