PSA Factories Are More Efficient Than Opel’s, Says Tavares

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PSA Group factories appear to be more productive than the ones operated by the newly acquired Opel/Vauxhall, according to PSA CEO Carlos Tavares.

Tavares recently visited Opel’s factories in Zaragoza, Spain and Russelheim, Germany for benchmarking them against PSA’s own facilities.

"The gaps I have seen so far are quite big," Tavares told AutoNews at the Frankfurt auto show last week. "What I have seen so far is PSA is more productive and more efficient than the Opel sites," he added.

"I also expect to find situations where Opel will be better than PSA, so that PSA people can learn," Tavares said.

Opel/Vauxhall currently has six assembly factories in Europe, with the future of some of those being unclear as Tavares is working on his plan to make Opel profitable again. That includes sharing more platforms and drivetrains within PSA and having similar models produced at the same factory.

Under former owners GM Europe, Opel’s factories -with the exception of Zaragoza- had lower utilization rates than PSA’s plants, according to analysts. Opel’s Zaragoza plant was at 78 percent of its full capacity while Eisenach was at 65 percent and Russelheim at 51 percent.

PSA’s biggest factories, in Vigo, Spain and Sochaux, France were at 78 percent and 83 percent respectively, with the facilities in Poissy and Mulhouse running at full capacity.

Tavares has said that turning Opel around will be based on making the company more efficient and not by chasing to sell more vehicles. "We would like to sell more Opels but the turnaround plan will not be built on the top line. That would be "extremely dangerous because it makes you vulnerable to overall economic downturns," he said.

"We will not bet the future of the company on an increase of volumes, but we will demonstrate we can have a lower breakeven point than the one we have today,” Tavares added.

"I can feel some similarities between the situation at PSA four years ago and the situation at Opel today,” he said. “The conclusion of this is very simple. It's all about efficiency. If we are highly efficient we will be profitable. If we are profitable we will be sustainable. If we are sustainable nobody has to worry about his job.”

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