General Motors and Peugeot Alliance Plans May Include Job Cuts and Plant Closures

General Motors bought a 7% stake in PSA  at the end of February, originally the plan was that they would share components, especially when ordering parts in the future, and share logistics in Europe. Now more details are coming out, and it appears that the parts sharing will be more significant than first insinuated, and it could lead to job cuts. GM and Peugeot are projecting a $2 billion annual savings due to the cooperation. 

The two companies may share large vehicles and dual-clutch transmissions. They are going to work together to develop subcompacts, mid-sized cars, compact minivans and hybrid powertrains for minivans, crossovers and small cars. However, plans have been canceled to produce GM vehicles at Peugeot's factory in Madrid, Spain, and the factory may be closed. 

Unfortunately, it looks like Peugeot and Opel workers might be fired due to the two companies working together. Representatives of the Opel and Peugeot unions will meet in Brussels, Belgium, to coordinate against the job cuts. 

An unnamed source told Reuters that factory closures were part of the GM-Peugeot negotiations, but an announcement about them will not be made until after the French presidential election.

The next generation Citroën C3 and Opel Corsa will probably be on a united Peugeot platform; while the next Citroën C5 and Peugeot 508 will probably use a GM platform. 

Source: Reuters (1,2)