Manufacturing News

PSA may let Opel expand into China

Opel's global export push could mean production of its vehicles in PSA Peugeot Citroen’s assembly plants in China, Russia and Iran -- and even sales in the U.S. home market of its former owner, General Motors.

Opel is exploring potential new markets for its vehicles outside Europe as part of its turnaround plan.

As GM’s German division, Opel was not allowed to have a big presence in key growth markets such as China because GM feared Opel would compete with sibling vehicles from Chevrolet and Buick.

Now under PSA’s ownership, Opel has more freedom to pursue sales in non-European markets. "Opel will go global, finally," CEO Michael Lohscheller said last week here while presenting his turnaround plan.

PSA appears unconcerned that Opel might cannibalize sales from Peugeot and Citroen. That’s because PSA has struggled to establish a niche in China.

The French automaker’s joint venture, Dongfeng Peugeot Citroen Automobile Co., produces an array of Citroen and Peugeot models in China. But sales have collapsed. In the first 10 months of the year, sales of Dongfeng Peugeot plunged 40 percent to 276,300 vehicles.

Opel has dipped its toes into China. It sold 5,000 cars annually in China early in the decade, but sales were hurt because its imported vehicles were subject to China’s 25 percent tariff.

PSA is counting on Opel to establish a presence in new markets around the world. Lohscheller said Opel will enter more than 20 new markets by 2022, with Argentina, Saudi Arabia and Taiwan among countries identified as potential export targets.

Opel also is exploring whether to sell cars in China and Brazil, he said.

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