Peugeot arm to handle GM's Europe logistics PSA Peugeot Citroën is to begin delivering cars, parts and materials for General Motors in Europe, marking the first joint undertaking of the two carmakers" four-month-old strategic alliance. Peugeot's Gefco unit will take over the majority of the US carmaker's logistics on the continent - including Russia - for GM's Opel/Vauxhall, Chevrolet and Cadillac brands, the two companies said on Monday. GM and Peugeot, both of which are losing money in Europe, this year agreed to join forces in a global alliance that they said would generate each company $1bn in annual cost-saving synergies within about five years. Gefco will deliver materials and components to GM's manufacturing plants and finished cars to its dealerships, and transport spare parts to the Detroit carmaker's distribution centres in Europe, the companies said. Steve Girsky, GM's vice-chairman and chairman of Opel's supervisory board, said on Monday that the logistics agreement marked "the first step in realising benefits from the larger alliance with PSA." Philippe Varin, Peugeot chief executive, said the agreement would enable Gefco to continue its strategy of broadening its client base and growing its global operations. The deal will set the stage for the sale of a majority stake in Gefco to one of several private equity groups reported to be interested in Peugeot's logistics division. The French group is selling a majority stake in Gefco to outside investors as part of a plan to generate cash by raising €1.5bn from asset sales this year. Gefco employs 10,300 people and reported sales of €3.8bn in 2011. GM is looking to cut costs and revamp its product line in Europe, where it lost $747m before tax last year. Last week, Opel's board approved a new five-year business plan aimed at restoring the unit to profitability in a declining market. Both GM and Peugeot face pressure on their profit margins from tough competitors such as Volkswagen and Hyundai and a glut of mass-market cars amid deep discounting by manufacturers.