Dongfeng Vows It Won’t Attempt to Take Control of PSA

CEO Zhu Fushou tells L'Alsace that Dongfeng Motor Group has no plan to seize control of PSA Peugeot Citroen after agreeing earlier this month to buy 14% of the French carmaker for €800 million.

"This is not a purchase deal," he tells the newspaper. The two vehicle producers, who have been partners in China for 22 years, aim to hike PSA's annual sales in the country to 1.5 million from about 550,000 units last year and expand into other Asia-Pacific markets.

Fushou says the Asian strategy will attempt to reduce the proportion of vehicles PSA sells in Europe below 50% from the current 62%.

Dongfeng's stake, paired with an equal investment by the French government, will help cover PSA's cash needs over the next three years as it completes its turnaround, according to Fushou.