PSA Peugeot Citroën

The PSA Group (), legally known as Peugeot S.A. (Peugeot Société Anonyme, trading as Groupe PSA; formerly known as PSA Peugeot Citroën from 1991 to 2016) was a French multinational automotive manufacturing company which produced automobiles and motorcycles under the Peugeot, Citroën, DS, Opel and Vauxhall brands. On 18 December 2019, PSA and Fiat Chrysler Automobiles (FCA) announced that they had agreed to the terms of a binding $50 billion merger. On 16 July 2020, both companies announced the new name for their merged operations, Stellantis. The deal closed on 16 January 2021. Stellantis is now the third largest automotive manufacturing company, behind only Volkswagen and Toyota.

Peugeot was the largest PSA brand. PSA was listed on the Euronext Paris stock exchange and was a constituent of the CAC 40 index.

Beginning in 2016, PSA began to outline a strategy which entailed the rapid expansion of the company, through both geographic expansion and acquisitions of other car companies. PSA has announced plans to enter the Indian, American, Canadian, South East Asian, and other markets in the coming years.

Headquartered in Rueil-Malmaison, PSA, with sales of 3.88 million units in 2018, was the third-largest Europe-based automaker, just a fraction behind Renault.

In 2019, Groupe PSA was the ninth largest automaker in the world, after Volkswagen, Toyota, the Renault–Nissan–Mitsubishi Alliance, General Motors, Hyundai Motor Group, Ford Motor Company, Honda, and Fiat Chrysler Automobiles.

History

Citroën acquisition

In December 1974 Peugeot S.A. acquired a 38.2% share of Citroën. On 9 April 1976 they increased their stake of the then bankrupt company to 89.95%, thus creating the ''PSA Group'' (where PSA is short for Peugeot Société Anonyme), becoming PSA Peugeot Citroën. Since Citroën had two successful new designs in the market at this time (the GS and CX) and Peugeot was typically prudent in its own finances, the PSA venture was a financial success from 1976 to 1979.

Chrysler Europe acquisition

In late 1978, PSA purchased the failing Chrysler Europe (which had been Rootes and Simca) from the troubled US parent firm for a nominal US$1.00, plus assumption of outstanding debt, leading to losses for the consortium from 1980 to 1985. Further investment was required because PSA decided to create a new brand for the entity for the disparate French and British models, based on the Talbot sports car last seen in the 1950s. From then on, the whole Chrysler/Simca range was sold under the Talbot badge until production of Talbot-branded passenger cars was shelved in 1987 and on commercial vehicles in 1992.

All of this investment caused serious financial problems for the entire PSA group; PSA lost money from 1980 to 1985. There were some bright spots, however: mainly thanks to the success of the Peugeot 205 and in spite of Talbot sales withering away, PSA surpassed Renault in sales in the domestic French market for the first time in 1983. In 1987, the company dropped the Talbot brand for passenger cars when it ceased production of the Simca-developed Horizon; the Samba and Alpine/Solara had been discontinued a year earlier. What was to have been the Talbot Arizona became the Peugeot 309, with the former Rootes plant in Ryton and Simca plant in Poissy being turned over for Peugeot assembly from October 1985. Producing Peugeots in Ryton was significant, as it signaled the first time that PSA would build cars in the UK (car assembly at Ryton stopped in 2006 and the plant was closed). The Talbot name survived for a little longer on commercial vehicles until 1992 before being shelved completely. From 1987 to 1995, the Ryton plant also produced the Peugeot 405 saloon.

Crisis (2012–2014)

On 29 February 2012, PSA announced the creation of a major alliance with General Motors (GM), as part of which GM became PSA's second-largest shareholder, after the Peugeot family, with a holding of 7%. The alliance was intended to enable $2 billion per year of cost savings through platform sharing, common purchasing and other economies of scale.

In July 2012, a union official said that PSA Peugeot Citroën would cut as much as 10 percent (8,000-10,000) of its French workforce of 100,356 employees on permanent and temporary contract. The jobs cut was more than previously announced.

On 24 October, PSA said it was close to an agreement with creditor banks on €11.5 billion ($14.9 billion) of refinancing and had won state guarantees on €7 billion in further borrowing by its Banque PSA Finance.

On 12 December 2013, General Motors announced it was selling its 7% stake in PSA Peugeot Citroën to Padmapriya Automobile Investment Group.

In 2014, Dongfeng Motor Group, the Chinese partner that builds PSA cars in China, and the French government each took a 13% stake in PSA, in a financial rescue operation, reducing the Peugeot family share from 25% to 14%.

Rapid expansion

Following Dongfeng and the French government each acquiring stakes in Groupe PSA, various cost-cutting measures at the company turned its fortune around and gradually reduced PSA's debt, until the company began to turn a profit beginning in 2015. A new CEO, Carlos Tavares, was engaged and began to implement various cost-cutting measures and expanded the model range of all three core brands, alongside the creation of a new brand, DS Automobiles.

In early 2016, PSA unveiled a roadmap detailing its plan to re-enter the North American car market for the first time since 1991.

Acquisition of 'Ambassador' brand from Hindustan Motors

On 10 February 2017, PSA announced a 50:50 joint venture with the CK Birla Group, the owner of the Hindustan Motors to sell Peugeot, Citröen, and DS vehicles in India and purchase of the Ambassador brand from Hindustan Motors at the cost of INR 80 Crore.

Acquisition of Opel and Vauxhall Motors

On 14 February 2017 PSA announced that it was in talks to acquire Opel and Vauxhall Motors from General Motors. The talks were in an advanced stage, but were a surprise to the press and to much of Opel's leadership as they had plans to transform the company into an electric-car-only brand using the platform of the Opel Ampera-e for a wide range of models. GM agreed to continue to supply PSA with Ampera-e and other electric vehicle technology. In August 2017, PSA completed acquisition deal of Opel and Vauxhall.

GM reported a loss of US $257 million from its European operations in 2016, sixteenth consecutive loss-making year for GM in Europe, bringing its amount of losses on the continent since 2000 to more than US $15 billion. Some expressed concerns about what this major acquisition might do to PSA's bottom line. However, due to this amount of debt, it is likely that GM may give the brands to PSA, or sell Opel and Vauxhall at a highly reduced price. Tavares expects synergies a decade after the takeover.

PSA CEO Carlos Tavares met with German Chancellor Angela Merkel and British Prime Minister Theresa May at separate meetings where he toured some of Opel and Vauxhall's operations in Germany and the UK, respectively. He assured the leaders that jobs would be safeguarded and that Vauxhall's Ellesmere Port plant was to be used by PSA at least until 2021.

Tavares announced that he wants Opel to keep its German brand identity and to embrace it, and that he would leverage Opel's pedigree of German engineering and Motorsport and use the company's heritage to reach markets and customers that may not consider a French car due to perceived reliability issues. He also announced that the Opel and Vauxhall brands would be elevated to new heights within Groupe PSA, including the sale of Opel and Vauxhall-branded vehicles outside Europe for the first time in many decades.

Bid for Proton

On 17 February 2017, PSA announced its bid to acquire PROTON Holdings, which owns the Proton and Lotus brands, but lost out to Geely a few months later.

Merger with FCA

In May 2019 Fiat Chrysler Automobiles (FCA) announced its intention to seek a merger with Groupe Renault. However, in early June merger talks were suspended, and never resumed. On 31 October 2019, Groupe PSA announced intent to merge with FCA. The merger would be on a 50-50 all stock basis. On 18 December 2019, FCA and PSA announced that they had agreed to the terms of a binding $50 billion merger, expected to be implemented in the next 12 months. The new group is incorporated in the Netherlands and has John Elkann as Chairman of the Board and Carlos Tavares as CEO. On 15 July 2020, the two companies announced that the merged entity will be named Stellantis, from the "Latin verb 'stello' meaning 'to brighten with stars.'" On 4 January 2021, both shareholders of PSA and FCA approved the merger and the deal was closed on 16 January 2021.

Operations

The Peugeot, Citroën and DS Automobiles brands retain separate sales and marketing structures, but share common technology, development and assembling assets.

Jean-Martin Folz was PSA's CEO between 1996 and early 2007, when he was replaced by former Airbus head Christian Streiff. Streiff was sacked on 29 March 2009, a day after the company posted a full year loss for 2008. Streiff was replaced by Corus Group chief executive Philippe Varin. Carlos Tavares became CEO in 2014.

Developing markets

PSA was actively committed to developing its market presence and sales in many fast growing developing countries and regions of the world. This led to huge investments and partnerships in South America, Iran (Iran Khodro) and China (Dongfeng Peugeot-Citroën Automobile). It announced plans to invest €650 million in a manufacturing plant in Sanand, India. With a capacity of 170,000 vehicles, the Sanand plant started production of the aaa in 2020. In Kazakhstan, assembly of the Peugeot passenger cars will start in June 2013 with a production capacity of 4,000 units per year at the beginning and more than 10,000 units in the near future. A PSA plant was opened in 2018 in Tunisia and in 2019 in Kenitra in Morocco.

Citroën will enter the Indian market in early 2021, with the launch of the C5 Aircross SUV manufactured at a plant in Tiruvallur, India.

Peugeot Citroën Automobiles SA

The manufacturer of Peugeot, Citroën and DS Automobiles-branded cars and vans, 100% owned by PSA Group and formed from the combination of Automobiles Citroën and Automobiles Peugeot. Automobiles Citroën, Automobiles Peugeot, and DS Automobiles remain in operation in relation to specific retail operations in various countries but not in the development or manufacture of vehicles.

PSA PowerTrain (Formerly Peugeot Citroën Moteurs)

PSA PowerTrain is a manufacturer of petrol and diesel engines for a range of companies including Ford, Jaguar, BMW, and Land Rover. It was founded by Peugeot in 1898 in Lille and later named Compagnie Lilloise de moteurs (CLM). In 1992 SCM-CLM as it was then known became Peugeot Citroën Moteurs.

The company has had a partnership with Ford Motor Company since 1998, supplying diesel engines to Ford and its subsidiaries, such as Jaguar, Volvo, and Land Rover.

PSA and BMW have an agreement to develop the 1.6 Prince engine. PSA also sell their engines, gearboxes and other parts to small independent manufacturers such as DeLaChapelle and PGO. This PSA Peugeot Citroën 1.6-litre turbo petrol engine has received the International Engine of the Year awards a total of eight times, from 2007 to 2014.

Process Conception Ingénierie

Process Conception Ingénierie (PCI) is a French-based manufacturer of machine-tools for the automotive and aircraft industry.

Peugeot Motocycles

Peugeot Motocycles is 51.05% owned by India's Mahindra Group and the rest by Peugeot and manufactures a range of mopeds and scooters. The subsidiary owned 50% of the Chinese Jinan Qingqi Peugeot Motocycles joint venture in 2006 which became wholly owned subsidiary of China South Industries Group in 2013.

Faurecia

PSA owns 57.43% of automotive supplier Faurecia, a company created by a 1997 merger between Bertrand Faure and PSA-owned ECIA. It provides various components to Peugeot, Citroën, DS and significant interior and exterior parts to companies such as Audi, BMW and Mercedes-Benz.

Gefco

Gefco is a large international logistics company, established by Peugeot in 1949 and named Les Groupages Express de Franche-Comté. In November 2012, PSA sold a 75% share to Russian Railways (RZD) for €800m, but retains Gefco as the main logistics provider.

Motaquip

Motaquip is an all-makes aftermarket parts company and was established in the UK by PSA Peugeot Citroën in 1981. In December 2014 Motaquip was sold to an outside company to become independent of PSA as "Motaquip Limited". The head office is now based in Nuneaton, UK, with all parts distributed from a warehouse in Luton, UK.

Financial services

PSA wholly owns Banque PSA Finance which provides financial services, and 98.67% of GIE PSA Tresorerie which was founded in 1990 as a treasury and cash management services division.

Former marques and subsidiaries

A number of marques were inherited following the acquisition of Chrysler Europe in 1978, and some were merged to re-establish Talbot, a previously dormant marque.

Chrysler Europe marques included the British Sunbeam (1901–1976), Humber (1868-1976), Singer (1905–1970), Commer (1905–1979), Hillman (1907–1976), Karrier (1908–1977), the French Simca (1934–1977) and the Spanish Barreiros (1959–1978).

Cycles Peugeot produced bicycles from 1882 until 2005. In 1987 ProCycle of Canada acquired rights to distribute French-made Peugeots in North America and in 1990, Cycles Peugeot sold the North American rights to market bicycles under the Peugeot name to ProCycle. In 2001, ProCycle discontinued the Peugeot bicycle brand. In Europe, the licence to produce Peugeot-branded bicycles was sold to Cycleurope, a company making bicycles under different names, on condition that it would be reconsidered in 2004. That license was later withdrawn for Europe, though production of bicycles for export continued for another year.

Citer SA is a French-based car rental company established by Citroën in 1968 was sold to Enterprise Holdings in 2011.

Joint ventures and collaborations

Sevel SpA

Sevel (''Société Européenne de Véhicules Légers SA'' and ''Società Europea Veicoli Leggeri-Sevel S.p.A.'') was established in 1978 and is equally owned by PSA Group (Peugeot Citroën DS) and Fiat. As a result of this, two factories have been built assembling three ranges of vehicles, Sevel Nord and Sevel Sud. Peugeot and Fiat's Argentinian operations were also joined under the name of Sevel Argentina S.A. (''Sociedad Europea de Vehículos para Latinoamérica''), although Fiat withdrew in 1995. Currently Sevel builds the Fiat Ducato, Peugeot Boxer, and Citroën Jumper.

Dongfeng Peugeot Citroën Automobile

The joint venture with the Chinese company Dongfeng Motor Corporation (later Dongfeng Motor Group) was established in 1992 and produces the Citroën C-Triomphe, 207, 307 and 408 models at factories in Wuhan and Xiangyang.

Peugeot Citroën Mitsubishi Automotiv Rus

The Kaluga factory was built by the Russian-based joint venture between PSA Peugeot Citroën (70%) and Mitsubishi Motors