Around March of this year, General Motors acquired seven percent of the French collaboration, PSA Peugeot-Citroen. The move was made to expand GM’s Europe division and gain a long-established ally but word on the street has it that the General isn’t too pleased with PSA’s recent work. As the French company gets closer to its fifth straight annual sales decline, GM might cut down its investment if things don’t turn around fairly soon.
According to an Automotive News article, GM’s investment into PSA exceeded its fair value at the end of June. After numerous market fails on their own starting in 1999, the General went ahead and invested about $423 million into Peugeot-Citroen to enter into the alliance. With hopes of boosting their European market, vehicle purchasing and joint development were to take place but since the signing earlier this year, not much has transpired. At this point in time, GM is chalking up the bad numbers to “economic uncertainty” and says a full-blown decision won’t be made until later this term.
Source: AutomotiveNews.com
