PSA sets targets for Opel merger

French manufacturer PSA Group expects the purchase of General Motors’ Opel division to lead to combined sales of 5 million vehicles by 2022, and could save up to $2.9 billion dollars annually, sources told Reuters. A deal could be finalised as soon as early March. PSA and GM confirmed negotiations last week. The acquisition of Opel would make PSA group the second-largest European car maker, based on sales, after the Volkswagen group. The targeted savings will come from purchasing and research and development, the sources claimed. New Opel models, such as the popular Corsa mini, could be brought into Peugeot’s development and manufacturing division to reduce duplication. The merger is concerning for the 38,000 people employed in GM’s Opel and Vauxhall plants in Germany and Britain. "PSA Group reaffirmed its commitment to respect the existing agreements in the European countries and to continue the dialogue with all parties," the car maker said in a statement on Tuesday. Exane BNP Paribas analyst Dominic O'Brien said the $2.94 billion savings could mean the eventual elimination of up to 6000 jobs. "The most obvious starting point for any restructuring, of course, lies with labour," he said. Current GM contracts guarantees the plant will run until 2019-20. While no Opel-badged cars are currently imported into New Zealand commercially, Opel is set to manufacture the Holden Commodore in its German factories from 2018 onwards.