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PSA’s acquisition of Vauxhall/Opel to herald consolidation and technology investment

PSA’s acquisition of Vauxhall/Opel to herald consolidation and technology investment

A combined PSA and Vauxhall/Opel operation will enhance the French-owned company’s ability to innovate and bring big steps forward in vehicle connectivity and powertrain, according to experts at CAP HPI.

Following last week’s announcement that PSA, which owns the Citroen, DS and Peugeot brands, was buying General Motors’ European operations in a £1.9 billion deal (Newspress week commencing 6 March), Matt Freeman, managing consultant, CAP HPI Consulting said: “With a deal of this size there will undoubtedly be challenges. However, the real potential benefits of this deal will come from the longer-term consolidation of the two businesses. “While efficiencies will be found from the better use of plant capacity to a consolidation of the supplier base, it will be the integration of model development programmes around common component sets that drives real change. 

“The greater scale the combined PSA and Vauxhall/Opel businesses will have for technology investment will see a step change in vehicle development, which requires not only investment in new powertrain technology, but also the development of a wind-down strategy for internal combustion engines.

“Better scale will also create a better negotiating position when dealing with technology providers like Apple and Microsoft.”

However, added Mr Freeman: “Some questions remain. Will a combined PSA and Vauxhall/Opel pursue a global strategy or be Europe-focused? Apart from DS, there is no premium brand in the combined group with the European Union market increasingly dominated by premium brands, how will PSA and Vauxhall/Opel deal with this?”