Report: PSA May Sell Faurecia

PSA Peugeot Citroen is considering the sale of its 57% stake in its Faurecia parts unit as part of a proposed equity tie-up with China's Dongfeng Motor Group, according to Reuters.

The news service cites unidentified sources who say Faurecia has hired an advisor regarding the sale. The sources describe the talks as preliminary and depend upon the outcome of separate discussions about equity investments in PSA by Dongfeng and the French government.

Under the latter proposal, Dongfeng and the government would each invest €3 billion in PSA, and each would gain 20%-30% ownership in the carmaker. But Reuters' sources say the plan has made little progress because Dongfeng remains unconvinced about the strategic benefits of such an investment.

PSA is not eager to sell Faurecia. But Reuters says a sale may be needed to gain EU support for French aid to the carmaker.