GM and PSA had signed contracts for jointly developing three car models by 2016, as well as for closer cooperation in purchasing, German carmaker Opel announced Thursday.

Opel, which is owned by GM, was planned to share in projects for a van and two small cars, the company said in a statement.

The joint venture is part of a strategic alliance, already agreed between GM and PSA in February, with the aim of saving costs to the tune of $2 billion (1.5 billion euros) a year. The alliance also includes close logistics collaboration, for which agreements were signed this summer.

"The joint car projects will create models that maintain the typical features of both Opel and PSA cars and will distinguish themselves from each other," a spokesman for Opel told German news agency dpa.

Plans for jointly developing a compact car, modeled on Opel's Insignia, were cancelled, the spokesman added.

General Motors bought a 7-percent stake in PSA in February, and sought to merge its Opel/Vauxhall operations with the French carmaker. However, merger talks collapsed in November after PSA's financial woes worsened. With the European car market in crisis due to a recession, both car manufacturers are faced with heavy losses and overcapacity.

uhe/mz (Reuters, dpa, AFP)