General Motors Confirms Sale Of Opel And Vauxhall To PSA For $2.3 Billion
Three weeks ago, rumors started circulating on the internet that General Motors was considering the sale of its Opel and Vauxhall operations in Europe to PSA, the holding group that owns Peugeot and Citroen. Today, those rumors were confirmed. PSA is buying Opel and Vauxhall for $2.3 billion.
The deal will make PSA the second largest automaker by volume in Europe behind Volkswagen. “We want to create a European automotive champion,” said PSA Groupe Chairman Carlos Tavares. “We will totally unleash the potential of the Opel and Vauxhall brands.”
Opel has been part of General Motors for 90 years. Letting it go is a bittersweet moment for The General. “This was a difficult decision for General Motors,” CEO Mary Barra said. “But we are unified in our belief that it is the right one.” GM has been losing money on its European operations for the past two decades.
GM will now limit its focus to North America and China. “For GM, this represents another major step in the ongoing work that is driving our improved performance and accelerating our momentum,” Barra says. “We are reshaping our company and delivering consistent, record results for our owners through disciplined capital allocation to our higher-return investments in our core automotive business and in new technologies that are enabling us to lead the future of personal mobility.
PSA’s Tavares was quick to assure Opel and Vauxhall workers that their jobs are not at risk. “We respect all that Opel/Vauxhall’s talented people have achieved as well as the company’s fine brands and strong heritage. We intend to manage PSA and Opel/Vauxhall capitalizing on their respective brand identities.”
PSA will continue to supply some models to Buick in the US and Holden in Australia. The Buick Encore small crossover vehicle and Buick Regal sedan are both based on Opel engineering. There is no word on how the agreement will affect sales of the Chevy Bolt in Europe, where it is known as the Opel Ampera-E. Reservations for the Ampera-E have been particularly strong in Norway.
The deal means that GM now has only 8 total brands in the global marketplace. Three of them are exclusive to China. PSA and GM will continue to cooperate on the development of battery electric and fuel cell vehicles. What no one is talking about is whether the deal could open a path for PSA to resume sales in America, a market it abandoned more than 20 years ago.