PSA poised for global expansion following Opel acquisition

At the beginning of the month, PSA announced plans to buy Opel/Vauxhall from General Motors for €2.2 billion (about $2.3B), thus making the PSA Group the second largest car company in Europe after the Volkswagen Group. With the two brands under its umbrella, PSA wants to go truly global in the years to come, as revealed by family shareholder Jean-Philippe Peugeot in an interview with Welt am Sonntag.

He told the German newspaper the purchase of Opel and Vauxhall "will allow the group to conquer the rest of the world step by step." Jean-Philippe also admitted there had been discussions about a potential PSA-Opel marriage even before the year 2012 when General Motors inked a deal with the French to co-develop models, but the timing wasn't right.

In the same interview, his cousin Robert Peugeot said the major acquisition will help the PSA Group achieve important economies of scales by manufacturing at least three million cars in one core market. He went on to specify "all large carmakers have a volume of three million cars in one important market" and PSA should be able to hit that mark now that Opel is part of the group.

Robert also pointed out why it was a smart decision to acquire Opel considering the Rüsselsheim-based marque is doing well in countries where PSA's sales aren't that great. Case in point, Opel is selling more vehicles at home in Germany than Peugeot, Citroën, and the premium brand DS combined. Another relevant example is United Kingdom where Vauxhall's annual deliveries surpass those of the PSA's Group.

Chairman of the PSA Group's strategy committee, Robert believes adding Opel and Vauxhall to the portfolio won't have a negative impact on sales of Peugeot and Citroën models, or vice versa. He argues there will be "very little cannibalization" between the brands taking into account the newly joined members of the family will complement the others.