Car industry looks beyond mergers at the Geneva motor show

As auto industry leaders gather for the 2017 Geneva motor show, the focus is once again on the future of carmaking.

This week’s headline is of PSA Peugeot Citroen’s purchase of Opel-Vauxhall, but the underlying story is the industry’s seismic changes with the rise of electric vehicles, automated driving and car sharing.

Peugeot CEO Jean-Philippe Imparato was celebrating his brand’s 3008 being named European Car of the Year, saying: “Last year, we welcomed the Opel Astra’s win, because they made a great car and I’m happy to see we’ll continue the adventure together, it’s great.”

Merging PSA and Opel Vauxhall creates Europe’s second-biggest carmaker behind the Volkswagen group.

VW – which is undergoing major restructuring after its diesel emissions scandal – does not feel its top spot is threatened.

CEO Matthias Mueller said: “In the past Opel and PSA have been our accepted and well-respected competitors and they will be in the future as well. So we’ll be excited to see how competition changes in that environment. Obviously we have our own homework to do and we’re going to do that in a very single-minded way and therefore we are very positive about the future.”

The VW brand and PSA-Opel will be competing in a European market that analysts have said will become even tougher as demand is near its peak and young customers turn to ride-hailing services rather than buying a car.

The road ahead is challenging for all carmakers. They are facing squeezed profits amid lacklustre sales growth, changing consumer habits and new rivals as Silicon Valley invests big in automated vehicles.

Tighter emissions rules – as VW has found to its cost – are also an issue. Responding to that it is investing billions of euros in electric vehicles, automated driving and new mobility services and unveiled Sedric, an electric fully self-driving concept car at the Geneva show.