PSA Peugeot Citroen and BMW Discuss Alliance

Forming strategic alliances during recession times seem to be the easiest way to cut costs without slashing budgets and workforce at plants around the world. And even if they were often described as less-affected companies when it comes to the economic downturn, BMW and PSA Group officials met with representatives of the French government to discuss a potential agreement between the two companies, BMWblog wrote today. Although it's only pure speculations, it may seem like the two manufacturer also talked about a potential cooperation on electric cars.

The report was first published by the La Tribune but BMW officials denied it, saying the company has absolutely no intention in forming an industrial cooperation with PSA Group, the aforementioned source wrote. BMW spokesman Marc Hessinger said that a group of officials did meet with French authorities, but conversation topics were only related to a political collaboration between France and Germany. They also talked about electric technology, Hessinger explained, denying rumors claiming the two companies shared opinions about a co-owned electric model.

This would not be the first time when BMW works with PSA Group as the German car manufacturer already uses several engines provided by the French company. The 1.4- and 1.6-liter units used on MINIs are the same with the ones used on Peugeot 207 and 308 and on Citroen C4 and C4 Picasso.

As mentioned, this is only speculation but, given the fact that BMW quickly rushed to deny all reports, it could be a sign that the German automaker is indeed interested in forming an alliance with PSA Group. We believe, however, that the proverbial pinch of salt is recommended in this case.