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Within days of picking a stake in PSA Peugeot Citroen, General Motors is now believed to be on BMW's radar as a potential ally.
Talks are already on between the two on pooling skills for future technologies. BMW's CEO, Mr Norbert Reithofer, was quoted telling reporters at the Geneva Motor Show that BMW could look at ‘joining forces with a cooperation partner in North America'.
The industry grapevine suggests that it could be GM which marks a strong turnaround for a company that was down in the dumps barely four years ago before being bailed out by the US Government. GM has, since, moved on and wrapped up last year as the world's largest automaker (thanks in no small part to its Chinese joint ventures).
The first quarter of this year has already seen the company pick up a seven per cent stake in PSA with BMW likely to be the next in line. This move also reflects other global carmakers' intent to rapidly consolidate in the wobbly West, thanks to the crisis in Europe, while the US is barely emerging from an abyss.
Fiat, for instance, has already got Chrysler in its kitty. It was keen on roping in PSA too but the latter opted for GM. Renault and Nissan's successful marriage now has a third partner in the form of Daimler.
Volkswagen is, of course, the leader of the pack with a host of brands right from Audi and Skoda to Bentley and Seat (in addition to truck brands like MAN and Scania). Its more recent car ally, Suzuki, wants out but VW is in no mood to relent.
It is clear that the automobile industry believes that markets in the West, barring Germany and France, will take sometime to recover which only drives the need to forge alliances and stay afloat.
On fast track
In contrast, China is firing on all cylinders with Brazil, Russia and India also on the fast track. GM's success story has largely been driven by its Chinese partner, SAIC Motor Corp, and the duo is now working hard on India and ASEAN.
PSA could have slammed the brakes on India but is betting big on China where it has joint ventures with Dongfeng and Changan. Tata Motors-owned Jaguar Land Rover is close to formalising an alliance with Chery Automobile.
Across Asia, Mitsubishi (earlier part of the Daimler fold) was in equity talks with PSA but nothing emerged. Suzuki could be the right fit for Fiat but will first have to break free of VW which is easier said than done.
Hyundai and Kia are already going great guns while Toyota and Honda have traditionally steered clear of equity alliances. Ford, likewise, is not adding anything to its plate yet.
These are interesting times for global carmakers as they reckon with growth opportunities in emerging economies coupled with the need to stay afloat in their traditional markets.
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