FRANKFURT (Reuters) - PSA Group’s (PEUP.PA) acquisition of General Motors (GM.N) division Opel gives the French carmaker greater scale to pursue global expansion plans, family shareholder Jean-Philippe Peugeot told German paper Welt am Sonntag.
Earlier this month, PSA Group agreed to buy Opel from GM in a deal valuing the business at 2.2 billion euros ($2.3 billion), helping the French firm to become Europe’s second largest automaker by sales.
“This will allow the group to conquer the rest of the world step by step. This remains an important goal for PSA,” Jean-Philippe Peugeot said in a joint interview together with his cousin Robert Peugeot.
The Peugeot family clan controls 22.19 percent of PSA Group’s voting rights, and 13.68 percent of the company’s capital, said.
Although there are larger automotive companies measured by absolute annual sales, what counts is that you have at least three million vehicles produced in one core market to get real economies of scale, Robert Peugeot, who is chairman of PSA Group’s strategy committee, told the paper.
“All large carmakers have a volume of three million cars in one important market,” Robert Peugeot told Welt am Sonntag, explaining that the purchase of Opel will help PSA Group in this respect.
Although the combination of the German and French carmakers increases the group’s overall exposure to Europe, the brands remain complementary.
“Opel is strong in markets where PSA is not so strong,” Robert Peugeot said, explaining that Opel sells more cars in Germany than Peugeot, DS and Citroen combined, while Vauxhall sells more cars in Great Britain than all of PSA’s brands together.
“There is very little cannibalisation between the brands,” Robert Peugeot said.
A deal between the French and the Germans has been under consideration for years, even before 2012 when GM and Peugeot signed a deal to develop some passenger cars together, Robert Peugeot’s cousin Jean-Philippe told the paper.
“Our family thought about getting closer to Opel even before the agreement with General Motors,” Jean-Philippe Peugeot said, adding that the time wasn’t right back then.
(This version of the story corrects to attribute quote to Jean-Philippe Peugeot, paragraph three)
Reporting by Edward Taylor and Gilles Gulliaume. Editing by Jane Merriman