GM, Peugeot in "advanced alliance talks"

Automotive News is reporting that stories in two other papers, France's La Tribune and England's The Financial Times, assert that General Motors and PSA Peugeot Citroën are "in advanced talks about an alliance." Neither maker would comment on the stories, but it has been well documented that both are looking to turn around their European operations. Peugeot's parent announced 6,000 job cuts late last year and the immediate cessation of Le Mans racing this year. Opel lost hundreds of millions last year and took on a new CEO with a near-vertical climb ahead based on the prognosis for the European market.

If the talks are concluded in the way reports indicate, Opel/Vauxhall and Peugeot would cooperate on projects from developing engines and transmissions to complete models that each could sell. Peugeot already has partnerships with several other automakers, but none are as involved as this one could potentially be. It's understood that no shares in either company would change hands, but a partnership this intense would still require the approval of the Peugeot family.

We wonder if Opel/Vauxhall and Peugeot can do together what each can't seem to achieve alone. Sure, Opel could lower its development costs and with a joint model Peugeot could gain less expensive access to wider markets, but can the two different cultures create cars that would serve their respective brands? Suggestions are that talks are far enough along that an agreement, if achieved, could be announced at the Geneva Motor Show next month.

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