Reuters reported that General Motors and PSA Peugeot Citroen scrapped plans for a joint mid size car program, narrowing the scope for vehicle sharing within their nascent alliance while adding engine cooperation.
The automakers in a statement said that they had signed firm agreements on three out of four previously announced vehicles to combine their future small car program as well as roomier minivans and two sizes of crossovers, which combine features of sport utility vehicles and passenger cars.
A Peugeot spokesman said that “Plans to share future replacements for larger models such as the Citroen C5 and GM’s Opel Insignia were shelved after the companies failed to reach a convincing business case.”
The spokesman added that but with binding agreements on three other vehicle program and new plans to pool a future generation of small gasoline engines, the alliance is taking form and moving up a gear.
Peugeot without giving details said that the shared three cylinder engines, designed to comply with Euro VII emissions standards entering force around 2019, will bring big savings for both partners.
The GM Peugeot alliance plan has drawn investor skepticism as the French automaker’s finances worsen, prompting thousands of domestic job cuts under close supervision by Socialist president Francois Hollande’s government.
Earlier in the year, Detroit based GM took a 7% Peugeot stake in a capital increase by Europe’s second biggest automaker, as it burned through nearly EUR 200 million a month. GM is also struggling to stem losses in the depressed and highly competitive European market.
