Opel, the German carmaker now owned by France’s PSA Group (PEUP.PA), said a new version of its Corsa city car would be built exclusively in Zaragoza, Spain, from 2019.
This includes a fully electric version that will start rolling off the production line in 2020, Opel said on Wednesday.
The Opel Corsa has been made in Spain since 1982.
Car maker Opel, which PSA Group has agreed to buy from General Motors, will use the French carmaker’s technology in the next generation of its best-selling Corsa model, a company spokesman said, confirming a report.
The current Corsa model is built with GM technology. Opel had previously said its new Corsa, slated to be launched in 2019, would also be built with GM technology but has now decided to use Peugeot technology, allowing for higher margins, Allgemeine Zeitung Mainz reported in its online edition on Monday.
PSA, which agreed to buy Opel in March, was not immediately available for comment.
The new Corsa will be Opel’s fourth joint project with PSA after Opel models Crossland X, Grandland X and Combo. The Corsa will be built at Opel’s largest manufacturing site, in Saragossa, Spain.
France’s PSA Group is set to announce a deal to buy Opel from General Motors (GM.N) on Monday after striking an agreement with the U.S. carmaker and winning the blessing of its board for the acquisition.
The maker of Peugeot, Citroen and DS cars said on Saturday it would hold an early Monday press conference with GM, at which the transaction is expected to be presented after Reuters reported that a deal had been struck between the two automakers.
By acquiring Opel, the French group will leapfrog rival Renault (RENA.PA) to become Europe’s second-ranked carmaker after Volkswagen (VOWG_p.DE) by market share. Between them, PSA and GM Europe recorded 71.6 billion euros ($76 billion) in revenue and 4.3 million vehicle deliveries last year.
The tie-up was approved on Friday by the PSA supervisory board, on which the French government, Peugeot family and China’s Dongfeng (0489.HK) are represented as shareholders, one source with knowledge of the matter said.
Spokespeople for PSA and Opel declined further comment.
The two carmakers, which already share some production in an existing European alliance, confirmed last month they were negotiating an outright acquisition of Opel and its British Vauxhall brand by Paris-based PSA, sparking widespread concern over possible job cuts.
In their jointly issued invitation to a Paris press conference at 0815 GMT on Monday, PSA and GM gave no indication of its subject. Separate briefings for the German press and Opel unions are expected to be held the same day.
Sources close to the talks had reported progress on Thursday after the carmakers narrowed differences on a near-$10 billion Opel pension deficit and other issues. GM’s European arm recently posted a 16th consecutive year of losses.
The negotiations had encountered problems over GM demands that a PSA-owned Opel be barred from competing against its own Chevrolet lineup in markets including China, they said.
But the “non-compete” issues were finally resolved as GM agreed to inject “substantially more” into the pensions than the $1 billion to $2 billion it had initially offered, another person said. The sources declined to give further details. Detroit-based GM, which came close to selling Opel to Magna (MG.TO) in 2009, has faced investor pressure to offload its struggling European arm and focus on raising profitability rather than chase the global sales crown currently held by VW.
After fending off 2015 merger overtures by Fiat Chrysler with support from her board, GM Chief Executive Mary Barra agreed to target a 20 percent minimum return on invested capital and pay out more cash to shareholders.
For PSA, the Opel deal caps a stellar two-year recovery under cost-cutting CEO Carlos Tavares, who said on Feb. 23 he would apply the same methods to Opel if the deal went through. PSA averted bankruptcy by selling 14 percent stakes to France and Dongfeng in 2014, to match a diluted Peugeot family holding.
The acquisition offered an “opportunity to create a European car champion” and quickly exceed 5 million annual vehicle sales, Tavares told analysts as he presented full-year earnings. PSA also expects savings of up to 2 billion euros ($2.1 billion) from the tie-up, sources have said.
Tavares also told his board that PSA would redevelop the Opel lineup with its own technologies to achieve rapid savings, according to people with knowledge of the matter.
The country’s largest car manufacturer, PT Astra Internasional, expresses doubt that sales of automotive products would increase in 2016.
Car and motorcycle sales would not increase under the economic slowdown, Astra’s investor relation officer, Ira Ardianti, said here on Monday night.
Sales of both two and four wheeled motor vehicles have been flat in the past five months, she cited. The people’s purchasing power is still weak and have no fund to spare for luxury, she said.
Sales of motorcycles dropped in the regions mainly because of the commodity price fall such as palm oil and rubber prices, Ardianti said.
In the first quarter of 2016, Astra’s car sales dropped to 127,000 units from 137,000 units in the same period last year. In April and May, Astra’s sales of cars totaled 31,000 units and 33,000 units respectively.
Its sales of motorcycles also shrank to 1.1 million units in the first quarter of 2016. In April and May sales were recorded at 348,000 units and 338,000 units respectively.
“We could not make prediction , but hopefully the economy would improve and the people’s purchasing power would be stronger,” she said.
The Indonesian Automotive Industry Association (Gaikindo), however, said car sales in Indonesia (from factories to dealers) surged 11 percent to 87,919 units in May 2016, the second straight month of rising car sales year-on-year.
Gaikindo chairman Jongkie Sugiarto attributed the increase mainly to delivery of new models ahead of Idul Fitri holiday.
In April car sales in Indonesia grew 4.6 percent to 84,703 units from 81,000 units in the same month last year.
This is encouraging after being on the decline for 16 straight months previously.
Stakeholders in the automotive industry hope that this is the start of a rebound, in line with accelerating economic growth.
In the first quarter of 2016 Indonesias economic growth accelerated to a growth pace of 4.92 percent yoy), higher than the 4.73 percent GDP growth pace in the same quarter last year.
The countrys largest automotive company PT Astra International recorded a 2.7 percent decline year-on-year in car sales to 208,804 units in the first four months of the year.
Based on data at the Indonesian Association of Motor Vehicle Industries (Gaikindo), Low Cost Green Cars (LCGC) contributed 34,209 units to the total sales by Astra Group.
The sales in the first four month, however, was on the rise from 47,159 units in January to 49,933 units in February, to 54,508 units in March and to 57,204 units in April.
The Astra group produces and sells Toyota, Daihatsu, Isuzu, Peugeot cars and UD Trucks. Sales have continued to be dominated by Toyota with sales reaching 111,710 units in the January-April period.
Peugeot sales were the lowest in number reaching only 14 units. Sales of Daihatsu cars totaled 56,854 units, Isuzu 5,490 units, and UD Trucks 527 units.
Sales of motorcycles produced by PT Astra Honda Motor (AHM) reached 1,439,241 units, down 13.5 percent from 1,664,395 units in the same period last year.
Sales of non Astra cars in the first four months of the year totaled 177,316 units down 1.67 percent from 180,340 units in the same period last year.
Sales of non Astra motorcycles totaled 543,263 units.