Peugeot Citroën eyes tie-up with Mitsubishi
Friday 04 December 2009
PSA Peugeot Citroën is in talks with Japan's Mitsubishi Motors Company in a move that could lead to full-blown "strategic alliance".
Following Fiat's takeover of Chrysler earlier in the year, the discussions are evidence of further consolidation in an industry decimated by the global downturn.
The two companies already collaborate on the development of 4x4s and clean technology, particularly electric vehicles, and have a joint venture in Russia. The relationship could now be extended in a deal that "could lead to a strategic partnership", Peugeot said yesterday.
The French group's stake could come from a block of privately issued shares representing as much as half of the Japanese company's stock, according to Tokyo press.
The tie-up would give Peugeot the global reach it needs, including welcome footholds in both the fast-growing Asian markets and in the US. For Mitsubishi, it looks like a lifeline with the company's finances in a parlous state. It recorded a ¥32.5bn (£222m) operating loss in the first half of the financial year, and a 53 per cent drop in revenues, to ¥573bn.
But this is not the first time it has attempted a tie-up. In 2000, DaimlerChrysler, the German group, took a supposedly controlling stake in Mitsubishi Motors, also with a view to consolidating its global reach. What followed was more than five years of frustration as Mitsubishi repeatedly blocked efforts to make the necessary changes to the business. The partnership was finally dissolved in late 2005.
According to Garel Rhys, a car industry expert at Cardiff Business School's Centre for Automotive Research, Peugeot will need to be on its guard. "Daimler walked away because it realised that Mitsubishi was not prepared to take the necessary medicine," he said. "This time around, the French will have to be very firm because in Japan there are ways that apparent control doesn't quite work out that way."
- 1 Scottish independence: Ireland since 1919 is a lesson for Scotland in what a Yes vote means
- 2 Thailand deaths: Pair's bloodied bodies found naked on Koh Tao beach
- 3 Vogue under fire for 'Big Booty' article
- 4 Daniele Watts: Django Unchained actress detained by Los Angeles police after being mistaken for a prostitute
- 5 Kanye West stops concert after two fans don't stand up - doesn't realise one is in wheelchair and the other disabled
Thailand deaths: Pair's bloodied bodies found naked on Koh Tao beach
Jihadi John': MI5 may have identified Isis militant who killed David Haines but options limited
Russia freezes Ukraine into submission: Kiev admits country doesn't have enough fuel for winter
Scottish independence: Police will be on high alert on Friday whatever the result
The wedding photo from Ground Zero: A shot in the dark
Daniele Watts: Django Unchained actress detained by Los Angeles police after being mistaken for a prostitute
The political class is doing what Hitler couldn’t – destroying Britain
Scottish independence: Nationalist leader Jim Sillars threatens pro-union companies with 'day of reckoning' after independence
Scottish independence: Yes campaign feels the heat as Alex Salmond's NHS claims come under furious attack
£23m Birmingham cycle scheme is attacked by Tory councillor for not catering to the elderly
Portuguese academic says British are 'filthy, violent and drunk'
iJobs Money & Business
£20 - 24k (Uncapped Commission - £35k Year 1 OTE): Guru Careers: We are seekin...
£20 - 24k + Benefits: Guru Careers: This is a great opportunity for an enthusi...
£280 - £320 per day: Ashdown Group: The Ashdown Group have been engaged by a l...
£400 - £450 Per Day: Clearwater People Solutions Ltd: **URGENT CONTRACT ROLE**...