PSA completes deal to buy Opel/Vauxhall

PSA Group has announced it has completed the deal to purchase Opel and Vauxhall from General Motors.

Claiming to have already installed new managers within the former GM Europe brands, the PSA Group's takeover sees it become the second largest car brand after Volkswagen.

Following the announcement that the deal had gone through, PSA chairman Carlos Tavares claimed the automotive world was "witnessing the birth of a true European champion".

The first aim of the new alliance, said Tavares, would be to return Opel and Vauxhall to profitability.

According to Opel, plans had already been put in place to return the German and British brands to "positive operational free cash flow" by 2020.

PSA also has plans to boost Opel's operating margin to 2 per cent by 2020 and 6 per cent by 2026.

Most, if not all, the savings will come from a "much leaner" management structure and bigger economy of scales. Greater parts sharing leading to a reduced R&D spend is set to save a €1.7 billion ($A2.5 billion).

The announcement of the deal sees Opel part ways with GM after 88 years of ownership.

Opel, and its British cousin Vauxhall, hasn't been profitable since 1999 and had become an increasing burden as GM struggled for sales in Europe.

PSA and GM first joined forces back in 2012 to help share costs of developing small cars. The first model to result from the "global strategic alliance" formed with GM was the Crossland X SUV.

In the future, PSA and Opel will share the cost of the Corsa (Europe's Barina) that's due in 2019 and an all-new family of pure-electric vehicles.