GM: 'No intention' of investing more cash in Peugeot

[ne_one]

GM: 'No intention' of investing more cash in Peugeot
Automotive News
February 14, 2013

General Motors is "not betting on" an uptick in European auto demand later this year and has no plans to provide additional funds to its struggling partner in the region, France's PSA Peugeot Citroen, GM's CFO said Thursday.

"We have no intention of putting more cash into Peugeot," GM CFO Dan Ammann told reporters on Thursday during a briefing for the company's fourth-quarter results.

GM booked a $220 million charge to fourth-quarter earnings to reduce the value of its about 7-percent stake in PSA to fair market value after the French company this week reported a $6.74 billion annual loss for 2012. It is PSA's biggest loss ever.

GM CEO Dan Akerson on Thursday described relations with PSA Peugeot Citroen as good.

GM acquired a 7 percent stake in PSA in March 2012 as part of a budding alliance but warned in August it may have to write down the investment as the European auto market weakens.

Full article at link.

[hvac1000]

Europe has a boat load of money problems to start with so now is not the time to be investing.

[usa1]

Man, just another one of GM's "WTF were they thinking" moves.

[Bejeweled]

Man, just another one of GM's "WTF were they thinking" moves.

Absolutely. GM at its core has been a collection of bad decisions. A company that was once so great it commanded about half the u.s. auto sales. To this day still produces some of the biggest wtf moments in automotive history. Look no further than the Fiat tie up and compare it to this marriage. GM appears to be a butter face car company who hooks up with anybody that's still standing after the bar closes.

[BlackGTP]

Sounds like GM's investment in Fiat where they had to write down the investment and then eventually extorted a billion or so from GM. Hopefully GM has some kind of legal protection from similar extortion from the French.

But don't forget everyone, this is just a paper loss. It only becomes real money if GM actually sells the shares. Otherwise the value of the partnership is still there - cost savings of shared purchasing and shared chassis, etc.

[emh]

[B][SIZE=4]"We have no intention of putting more cash into Peugeot," GM CFO Dan Ammann told reporters

Mr. Ammann, the real question is why you put any cash into PSA at all in the first place.

[Ed753]

Come on guys, its going to be different this time! We got smart people running GM now!

[70AARCUDA]

Hm-m-m-m, sounds like somebody in Finance finally remembered the phrase: "...good money, after bad [money]..." (wink,wink)?

[germeezy1]

Are the same people responsible for the decision to pay Fiat to leave also responsible for the decision to welcome PSA with open arms?

[bmwboy2007]

"No intention"

Now there's some weasel words.

[LetsRace]

A GM/VW alliance would be a very powerful and interesting alliance.

[mchicha]

All is not lost. The upside of joint platforms is HUGE!! for GM. But for now it looks like a bad decision.

[mgescuro]

Mr. Ammann, the real question is why you put any cash into PSA at all in the first place.

Rats. You beat me to it.

[JudgeNjury]

Peugeot lost over 6 billion last year. GM was stepping in until the French government did with even deeper pockets.

[syr74]

A GM/VW alliance would be a very powerful and interesting alliance.

VW doesn't team up, they acquire.

All is not lost. The upside of joint platforms is HUGE!! for GM. But for now it looks like a bad decision.

Exactly. PSA has to remain solvent for this deal to work out for GM.