The bailout that PSA/Peugeot-Citroen negotiated with the French government and its Chinese partner, Dongfeng Motor Corp., will prop up the French automaker in the short term. But the deal has shortcomings that could cripple PSA’s competitiveness in the long run.To be sure, PSA desperately needs money, and this deal provides it. Dongfeng and the French state each will pay 800 million euros ($1.09 billion) for a 14 percent stake in PSA. In the real world, nothing is free, and this agreement creates two big headaches for the French automaker.
Tag Archives: PSA-Dongfeng deal
PSA-Dongfeng deal seen as necessary, but skepticism remains
PSA/Peugeot-Citroen’s capital tie-up with China’s Dongfeng Motor and the French government may not bring stability to the struggling automaker, observers said.The financial newspaper Les Echos described the deal as “the dragon that came to the rescue of the lion. The lion isn’t dead, but it has radically changed its appearance.”
