Isn’t it fitting that the builder of the Aztek would get in cahoots with the builder of some of the strangest cars in Europe? The Citroen 2CV, the GS Birotor (it even looks a bit like an Aztek). And the H Van - the Aztek actually would look good next to it. What do you think about the deal? Here’s an article:
BTW, try as I might, I can’t see the cars in the two photos. Can you?
Both GM Europe and P/C are having major problems. Today’s WSJ had an article on Europe’s car woes, dropping sales, etc, etc. This is supposed to drop their costs. Hope it works.
Sounds like another marriage between mismatched bookends to me. GM’s association with SAAB and Daewoo, Ford’s partnership with Jaguar, Volvo, (and SAAB at one time), along with Chrysler’s unholy union with Daimler Benz all point to it being another mess that the taxpayers will be on the hook for; at least in my opinion.
Toyota announced they were going to step up their presence in Europe and that could put a dent in Peugeot sales. I’ve worked on a few Peugeots and from what little I’ve seen of them buying a Toyota would be a slam dunk decision for me.
Peugeot/Citroen? Looks like GM is bound and determined to go bankrupt again. Who is making these asinine decisions anyway? They may luck out and have success in Europe since they don’t really care what a vehicle looks or drives like there. I see no success in the United States however. Our tastes are a little more sophisticated when it comes to motor vehicles.
Notice I said “a little more” since my neighbor insists on keeping his Subaru Tribeca pointed towards me. The styling in the back is acceptable but the front is totally unacceptable in my opinion.
So, is there anybody left who still thinks that GM has changed their ways?
Anybody still believe that GM has refocused on building cars instead of playing retructuring games to yield profits?
So, is there anybody left who still thinks that GM has changed their ways?
I was hoping they would…but it doesn’t seem like they have.
Maybe GM wanted the Citroen 2CV to compete with Chrysler and the Fiat 500. Also, maybe one the the television networks has found an actor to play Columbo, the police detective played by the late Peter Falk. There would have to be a Peugeot for Columbo to drive.
The last year of production for the Deux Chevaux was 1990.
I’m not sure it is in GM’s best interest, but they know more about the auto business, especially in Europe, than I do. I wish them both well.
BTW, the people that run GM were installed by the US government during restructuring. I guess we’ll find out about that, too, as time progresses. And they are in the business of making money. Building cars is a means to that end. And since it is a business, they have to more than just build cars. I think that GM has done a good job in car building lately.
GM already has a substantial presence in Europe.
They certainly don;t need an “inroad”.
To me this scene has played out before. In past years GM has owned in part or in whole no less than. Daewoo, Holden, Opel, Saab, Vauxhall, and Wuling. It’s also had it’s cars manufactured by others and branded, two of them by Toyota (the Vibe and the Prism).
Its core technology used to be manufacturing automobiles. Transitioning from that to becoming an accountanting company did not fare it well. This move suggests that it’s not returning to its roots.
I wish GM well, as I would wish well to a gambler that went broke in Vegas, got bailed out by a neighbor who robbed his children’s college trust funds to do so, and then headed straight back to Vegasl. But I wouldn’t expect the gambler to return a winner, and I’d expect GM ot be back at the public trough.
Sorry JT, but that’s they way I feel.
What really irks me? It looks like GM overpaid… significantly…
Peugeot has 226.86 million shares outstanding. They’re offering up a dilution of 16 extra shares for every 31 a shareholder currently has at a price of 8.27 euros per share. Current trading price is 11.89 euros, down from 14.209 euros when the deal was announced. GM will take 7% of the company, meaning they will buy 15.88 million to 24.08 million shares, depending on how many current shareholders take the dilution deal. The deal was valued at 304 million euros, meaning GM is paying 12.63 euros to 19.14 euros per share, again depending on how many existing shareholders take the deal. So if ALL the existing shareholders take the deal, GM is paying above current market prices (which will be sure to drop more as the shares are diluted, as the current market cap would suggest a price of 7.84 euros in this case). If none take the deal, GM will be paying 19.14 euros per share, which is still a 35% price premium to what Peugeot was trading for when the deal was announced.
Anyway you cut it, it looks like GM is paying much more than the shares are worth, unless the deal price was reported incorrectly.
GM still owns Daewoo, Holden, Opel, and Vauxhall. I never heard of Wuling. And as I said, we’ll find out how it works out.
And about that overpayment: How do you buy 7% of a company without disrupting the price? Sure, they could have bought a little here and there until they owned a great lot of the company, but they chose to go through the front door. Given that it happened all at once, they may nave gotten a good deal.
It still seems like GM is determined to make money and not cars. I wonder if Obama were still pulling the strings and holding the loan over their head, he would approve.
“I wonder if Obama were still pulling the strings and holding the loan over their head, he would approve.”
His Homies are still running the show. And if they don’t make money, they won’t build cars.
But what decent cars have they built lately anyway? Malibu, Sonic, Cobalt, Cruze, Corvette, Equinox, Camaro, Express, Silverado, Traverse, Enclave, Regal, CTS, CTS-V, CTS-V wagon (astonishing!), SRX, Acadia, Savanna, Sierra, Terrain, Yukon, Yukon XL, Tahoe, Suburban; wow, that’s 24 cars and trucks!
Considering that China is now the leading influence on who becomes the most succesful car companies, maybe, just maybe, companies like those in the sale can best address the needs of the Chinese. Maybe it is a relevant move. I don’t think selling lots of Corvettes and Suburbans is part of their Chinese market strategy.
Actually, apparently Buick’s, esp the larger ones are status cars in China. If that is the case, I don’t see them buying many Citroen/Peugeot smaller cars.
Huh, if their business is now making money instead of cars, maybe they’ll look at making buses, refrigerators, and monorails again. Maybe even start a finance business. Wow the options are unlimited. Sounds like they should have fired the accountants while they were at it.
@galant Actually, apparently Buick’s, esp the larger ones are status cars in China. If that is the case, I don’t see them buying many Citroen/Peugeot smaller cars.
May be a status symbol…but I’ll be the vast majority of sales are much smaller cars.
The Chinese aspire to own a Buick. If they can afford it, they buy one. GM went into the market in China before most other manufacturers, and even built a plant there. Their early move into this market paid off with excellent sales.
All businesses exist to make money. And there are different forms of business, including those whos core technology is making money. Investment firm, financial institutions, holding companies, etc. But most businesses understand that their money is made by their core technology. They stay in touch with their market.
GM lost sight of that for some years. They actually began using their financing division as their profit center and lost focus on their cars. That was the period when they began acquiring underperforming automakers to try to turn them around, bringing in and “branding” other makers’ cars, and some other poor practices. They kept their manufacturing facilities humming in order to keep their productivity and efficiency number high and relied on discounts and rebates to sell the product. They got away with it for some years while the economy was robust. Clearly, it was not a good long term strategy. They lacked the flexinility to adjust to changing markets and to changing economic conditions.
They forgot what it was that made them in the first place. When a company loses focus on its core technology, it also loses focus on its market. Few companies survive doing so without some form of bailout.
Maybe there should be a pool started as to when GM will go back to the bailout well again. My guess is within 5 years.