While the current difficulties may seem to be an impediment, analysts are remembering the remarkable turnaround PSA was able to manage at Opel after years of bleeding in the hands of General Motors.

The rumours of a discussion paper started earlier this month saying that PSA would benefit from the British-based company’s global manufacturing network and the potential to provide PSA with platforms in the upper-luxury market – especially SUVs via the Land Rover range.

Significantly, JLR is well placed in electrification design and engineering with the Jaguar I-Pace recently winning the World Car of the Year award.

PSA also announced in February that it intended to re-enter the market in the United States.

The cost of doing so may well be weighing on the French car-maker and the potential to pick up the Jaguar and Land Rover distribution operations in the US (where JLR sales are remaining firm) as part of a merger or takeover could be very appealing to PSA, which could achieve that representation at a fraction of the cost of starting a network from scratch.

JLR, owned by Indian conglomerate Tata, recorded an April sales drop of 13 per cent (compared with April 2018) but in specific markets such as China, the fall was 45.7 per cent.

Overseas markets, as an average, were down 22.3 per cent in April, with Australia down 13 per cent (Jaguar) and 14.2 per cent (Land Rover).

Its sales have been buoyed only by the UK (+12.1%) and the US (+9.6%).

A PSA spokesman told Just-Auto that it was “open to opportunities which could create long-term value for Groupe PSA and its shareholders” but had “no knowledge of a document” about a takeover.

Earlier this month, Tata Motors denied it was selling JLR to PSA and issued a statement saying: “As a matter of policy, we do not comment on media speculation. But we can confirm there is no truth to these rumours.”

While JLR could be the victim of “where there’s smoke there’s fire”, the same scenario was played out before PSA bought Opel.

Tata was seen by analysts as being under threat because of its position as a UK-based manufacturer if – when – Brexit was triggered.

JLR, which is the biggest car-maker in the UK, has been moving manufacturing outside of the UK as part of a decentralisation program, with its most recent move made last October with the opening of a $A1.9 billion plant in Slovakia.

It has had a factory in India since 2011, a joint venture in China (opened in 2014), and a plant in Brazil (2016) and Austria (2017).

JLR announced in January that it would cut its workforce by 4500 people and result in a redundancy cost of about $A370 million. The reduction is part of a global plan to put $A4.7 billion into infrastructure and investment by 2020.

By Neil Dowling and John Mellor