The companies plan to share vehicle platforms, components and modules as well as creating a global purchasing joint venture that will improve both groups’ leverage in sourcing goods and services from suppliers by commanding $125 billion in purchasing power. GM and PSA are aiming to achieve an annual savings of more than $2 billion from the joint-venture.
“This partnership brings tremendous opportunity for our two companies,” said Dan Akerson, GM chairman and CEO. “The alliance synergies, in addition to our independent plans, position GM for long-term sustainable profitability in Europe.” As part of the agreement, GM acquired 7% stake in PSA Peugeot Citroën for 304 million Euros.
For a start, the alliance will focus on small and midsize cars, MPVs and crossovers. The first model from the collaboration is expected to hit the market in 2016. With more and more mergers and partnership among automakers, I hope that driving experience will not end up like taking a meal in food court chains where there is not much difference in the taste of the food across the outlets.