GM could sell European divisions to French automaker PSA

GM and PSA confirmed the talks Tuesday morning, but said there was "no assurance" an agreement will be reached.

The American and French automakers have worked together in an alliance since 2012 on three projects and said the two sides regularly examine expanding the arrangement.

General Motors has owned Opel, the linchpin of its European operations, since 1929. Opel provides a considerable amount of global engineering expertise for GM – the Buick Regal is essentially an Opel Insignia – and the brand delivers major sales volume in European markets.

Selling Opel and Vauxhall, which GM has owned since 1925, would mean GM would not challenge Volkswagen and Toyota for position as world's largest automaker in the near term, though GM executives have been adamant about no longer chasing volume.

The move could position GM to focus more on mobility efforts and autonomous technology. Further benefits are unclear for GM, and disentangling Opel and Vauxhall, which collectively employ thousands of people and produce millions of vehicles, could prove to be a complicated process. There could also be intellectual property concerns. GM nearly sold Opel to auto supplier Magna in 2009, but that deal was later scuttled.

PSA, a conglomerate that oversees Peugeot, Citroen, premium brand DS, and other entities, was formed in 1976, though Peugeot traces its carmaking roots to the 1880s. Acquiring the GM European divisions would provide it considerably more scale to compete with larger global automakers.