PSA Peugeot Citroën: Watch What You Wish For

Gary S. Vasilash

Not long after PSA Peugeot Citroën and General Motors signed their agreement wherein the two vehicle manufacturers would collaborate and GM would take a 7% stake in the French company, things started to happen in Paris.

And not all of them good.


For example, earlier this week Bloomberg reported that the French company signed an agreement to sell its headquarters in Paris, which it has inhabited for 48 years. It is getting a reported 245.5-million Euros, or $327-million, for the 50,900-square meter structure. Given that it is not far from the Arc de Triomphe, it seems that the real estate bust must be affecting Paris, as well. Seems like the last time we spent a week in Paris we paid nearly that much for the hotel.

The ~1,900 people who work there aren’t going to be put out on the Champs-Elysees, however. PSA Peugeot Citroën is leasing the building back from the new owner.

Then there was the working relationship that PSA Peugeot Citroën had with Ford. For the last 12 years the two companies have collaborated on two diesel engine families, one 1.4-liter to 1.6-liter, and the other from 2.0-liter and up. Over this period of time, they’ve produced more than 20 million of these engines.

But yesterday, Ford and PSA Peugeot Citroën announced that henceforth, the development and production of 2.0-liter and above engines will be done separately. The current production will continue. But the new products will be separate.

Presumably, the folks in Dearborn are not all that keen about the relationship the French company has established with its cross-town rival.

And presumably, there are some folks in Paris hoping they bet on the right alliance partner.