FILE PHOTO: The logo of PSA Peugeot Citroen is seen at the company’s plant in Poissy, near Paris, October 31, 2019. REUTERS/Charles Platiau
PARIS/BEIJING (Reuters) – Peugeot maker PSA Group (PEUP.PA) is preparing to sell its 50% stake in a joint venture with Chinese partner Chongqing Changan Automotive (000625.SZ), a spokesman for the French carmaker said on Thursday.
Changan has already signaled in regulatory filings from early November that it is seeking a buyer for its half of the venture, which builds cars under PSA’s DS brand.
The manufacturing tie-up, known as Capsa, was set up in 2011 and has struggled with falling sales.
PSA is also looking to sell out of the venture, a spokesman said, though the group added that it would still look to roll out DS in China, without giving further details of how.
“The two partners plan to sell their stakes in their joint venture,” the spokesman said. “That does not change anything regarding DS’s presence and development in China, a new strategic plan will be presented in the coming weeks or months.”
PSA’s sale plan for the joint venture, which operates a factory in Shenzhen, will be presented to French unions on Friday, a source familiar with the matter said.
PSA’s sales in China fell again in 2018 by 32% to 262,583 vehicles, a long way off the 1 million-a-year target it had set itself a few years ago.
According to the latest Changan regulatory filing from Nov. 29, it is seeking a floor price of 1.63 billion yuan ($232 million) for its stake in the joint venture with PSA. Changan had no immediate comment.
($1 = 7.0389 Chinese yuan renminbi)
Reporting by Gilles Guillaume and Yilei Sun; Writing by Sarah White; Editing by Geert De Clercq