Dongfeng Signals No Quick Decision on PSA Investment

Dongfeng Motor Corp. has hinted that it has no approval yet from the Chinese government to pursue an investment in PSA Peugeot Citroen, Bloomberg News reports.

Zhu Fushou, the Chinese carmaker's general manager, tells an automotive conference in Wuhan that the more the immediate question is whether taking a stake in PSA "is reasonable or not."

Normally China's National Development Reform Commission grants permission for foreign investments. Earlier media reports indicated that the two companies won't move forward unless they can agree on a mutually beneficial product development plan.

Earlier this week Reuters cited anonymous sources who say PSA is finalizing a proposal to raise €3 billion ($4.1 billion) by selling stakes in itself to the French government and Dongfeng, its partner in China for 20 years.