France’s Finance Minister has pledged there will be no closures of PSA Peugeot-Citroen factories in France following yesterday’s (19 February) announcement Paris is to inject EUR800m (US$1.1bn) of public money into the automaker.
The French State will become a 14% shareholder of PSA along with a similar capital increase from Chinese partner, Dongfeng, as a total of EUR3bn is raised to aid the manufacturer, which yesterday revealed an operating loss of EUR177m for last year.
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“What we have wanted to do in going into the capital with EUR800m, is to guarantee financial stability in a new partnership that will open up markets, notably China,” said Finance Minister, Pierre Moscovici, in a French radio interview confirmed by his department in Paris to just-auto.
“[Automotive] is 400,000 direct jobs in France and 2m indirectly. In fact, there is an industrial agreement that implies a duty towards France. No closures of factories – 1m vehicles produced in France.
“The idea of the State is clearly to anchor this manufacturer in France and to allow it to grow internationally.”
The deal unveiled in Paris yesterday (19 February) will see the French State, Dongfeng and the Peugeot family group each own around 14% of PSA’s share capital, with each of the three to be represented by two members in a Supervisory Board.
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By GlobalDataQuestions have been raised as to the independence of PSA with greater Chinese involvement but the French government is stressing the three main shareholders will not act together.
Each of them will be represented by two members on the supervisory board which will have no more than 14 participants and will be chaired independently.
“I was a Deputy [Member of Parliament] in Sochaux where the history of PSA was born,” said Moscovici. “I know this manufacturer has the capacity and to stay even more [as] a big manufacturer on a global scale.
“We are going to defend the strategic interests of France and collectivity – that is why we are there. We wanted to have a governance that the State is present, to ensure the French character of this business, because it is a French business.”
The Finance Minister acknowledged part of PSA’s difficulties were generated by the economic challenges encountered in Europe during the last few years, but highlighted the potential of Asia as well as the fact the French automaker already worked with Dongfeng in a joint venture.
“I would not have wanted…to sell out the French character of this business,” said Moscovici. “It is really an anchoring of PSA, that today is guaranteed and the workers of PSA know it.
“I have invested a lot in this, which represents thousands [and] thousands of hours. The State has taken its part and the government has played its role.”
PSA also said former Renault COO, Carlos Tavares, would take over from Philippe Varin as president from 31 March.
