Cutting costs and boosting profitability – that’s the short version of why a deal for PSA and its Peugeot, Citroën and DS brands to buy General Motors’ Opel-Vauxhall business has been completed.

It’s clearly big news. Last year, Opel-Vauxhall's sales in Europe were around the 1.0 million mark and PSA's at around 1.5m. By combining the two, you get a group that moves well clear of Renault-Nissan into second place in the European sales charts, behind only the Volkswagen Group (3.6m sales in 2016).

PSA takeover of Opel and Vauxhall completed

PSA's purchase of Opel-Vauxhall also brings significant economies of scale. The number of vehicle platforms and engines that need to be developed for five brands producing cars competing in the same market segments would be significantly reduced. To that end, PSA has said it will switch over Opel-Vauxhall models to its own platforms as their replacments are launched, and it has taken ownership of GM's factories in which to build them. 

Car makers are under more pressure than ever to make huge investments in the future of their businesses, not least around the issues of reducing emissions and technologies such as autonomous driving. Spreading that investment across more brands for a greater return lessens the risk of that investment in the first place.