General Motors (GM), the world's third biggest automaker, has just let go of Opel and Vauxhall, their European subsidiaries. GM completed a multi-billion deal with Peugeot to take the two long-running brands under their wing. This now makes the PSA Group Europe's second largest car manufacturer, placing them behind Volkswagen.

Peugeot acquires Opel for $2.3 billion

With the deal made, it signals the withdrawal of General Motors from the European market altogether. Opel has been under GM since 1929 while Vauxhall was fully acquired in 1925. Confirming the merger is Peugeot themselves. In a press release, Peugeot said, together with General Motors, it is exploring numerous strategic initiatives aiming at improving its profitability and operational efficiency. Peugeot will be getting  six assembly plants, along with five other manufacturing facilities for parts. Peugeot also takes over the Opel engineering center, located at Rüsselsheim, Deutschland and will take approximately 40,000 employees under their wing.

“We are proud to join forces with Opel/Vauxhall and are deeply committed to continuing to develop this great company and accelerating its turnaround,” said PSA’s chairman of the managing board, Carlos Tavares.

Peugeot acquires Opel for $2.3 billion

This is not the first time General Motors was in talks to let go of Opel and Vauxhall. During the 2008 Financial Crisis, GM was ready to sell off their European subsidiaries but, instead, sold off their shares from Magna to keep the two European brands under their control. This time however, it will be the first time these two brands will fall under different control after over 90 years. With the acquisition, Opel and Vauxhall products will continue to use GM technologies from the engines to other mechanical parts in the meantime. Eventually, Opels and Vauxhalls will be using Peugeot platforms and engines.

The sale of Opel puts the future of some Holden and Buick products in limbo. Opel-derived models from Buick are the Regal (based on the Opel Insignia), Verano, Cascada (both based on the Opel Astra) and the Lacrosse (GM Epsilon II platform). The same applies to Holden with the all-new Commodore and Astra.