PSA Peugeot Citroen and Mitsubishi could be about to perform a large stock swap. The two car manufacturers already have established ties that include such projects as the Mitsubishi iMiEV electric car (which Peugeot calls the iOn) and the Mitsubishi Outlander SUV (which Peugeot sells as the 4007 and Citroen as the C-Crosser). But now the rapprochement could be entering a new stage.
The cooperation could be about to step up a gear and become a tie-up along the same lines as rival car maker Renault’s alliance with Nissan. Insiders close to the discussions aren’t sure what sort of arrangement might be realised, but the speculation is that PSA could end up taking effective control with a hefty minority stake in Mitsubishi in exchange for either stock in PSA, cash in hand or a combination of both.
The strengthened partnership would stand to help PSA compete not only with the Renault-Nissan alliance, but also with VW, Europe’s largest carmaker which is itself teaming up with Suzuki to gain extra presence in important Asian markets.
Industry analysts, however, warn that the move could be ill-advised for the French car manufacturing group as PSA are already burdened with growing debts and Mitsubishi’s have a relatively small production and market share.
Speculation on the potential partnership sent PSA stock down 3.6 percent, while Mitsubishi’s rose 7.5 percent – the largest respective drop and gain for each car maker in months.
Source: Bloomberg
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