PSA, GM Set Fast Pace for Joint Projects

PARIS – PSA Peugeot Citroen and General Motors are starting to seriously work together after agreeing to an alliance last month, adding a dual-clutch transmission strategy to three car projects months before the final deal is even signed and sealed.

The tie-up, announced Feb. 29, is expected to be officially approved by government regulators and the auto makers before the end of the year. It is expected to last 10 years and includes the sharing of vehicle-platforms and components. A global purchasing joint venture also is part of the plan.

At a meeting with workers councils from around Europe, the two auto makers explained their plans for saving €1 billion ($1.32 billion), including several major vehicle projects that are being delayed.

A program to begin making dual-clutch transmissions at PSA’s Valentines factory this autumn has been suspended while a French team working with GM tries to determine whether the partners can share a transmission. The alliance likely will be in place by the time that decision is made.

Another major PSA project being delayed for a second time is a low-cost, C-segment car developed for emerging markets, which was scheduled for production at the auto maker’s Spanish factory in Madrid. No new date has been set.

This program may be shared with GM in a wider, Renault-Dacia style plan for emerging markets that calls for low-cost, entry-level cars. Earlier, PSA delayed plans for a new plant in India that would have gone in that direction, and GM’s Adam Opel subsidiary needs a larger non-European presence if it is to achieve competitive volumes.

PSA executives tell the workers councils that five cooperative groups have been launched with GM. In addition to the one studying the dual-clutch transmissions, two are looking at the feasibility of shared platforms: one for C-D segment European sedans like the Opel Insignia and the other for B-segment minivans such as the Citroen C3 Picasso.

A fourth group is studying a program for small cars in emerging markets, with the first potential application in South America. Both partners have a significant presence in Brazil and Argentina. The fifth group is working on shared development of a small-car platform with ultra-low emissions.

PSA also is negotiating with Fiat on the withdrawal of the Italian auto maker from Sevelnord, a factory that has been making delivery vans for both companies. Fiat’s contract runs out in 2017, but PSA is trying to find a new partner for the plant and hopes to get a clearer picture of Fiat’s plans.

Executives say they will keep worker councils apprised of the conclusions reached by the five cooperative teams, and that any projects resulting from their decisions will be balanced between PSA and GM. Engineers who have been working on current projects that are delayed will be assigned to other areas, PSA says.

The auto makers said Thursday they have created a joint steering committee that includes five executives from each company. The committee will oversee alliance projects and explore areas where the partners could work together further.

PSA members include Jean-Christophe Quemard, executive vice president-programs; Jean-Baptiste de Chatillon, chief financial officer; Guillaume Faury, executive vice president-research and development; Yannick Bezard, executive vice president-purchasing; and Denis Martin, executive vice president-manufacturing.

GM officials include Steve Girsky, vice chairman; Dan Ammann, CFO; Mary Barra, senior vice president-global product development; Stephen Carlisle, vice president-global product planning and program manager; and Karl-Friedrich Stracke, president-GM Europe.