THE Peugeot 3008, a striking SUV, was voted European car of the year on March 6th, the eve of the opening of the Geneva motor show, an annual industry shindig. PSA Group, the maker of Peugeots and Citroëns, would doubtless view it as the second prize it scooped that day. News also came that the French carmaker was buying Opel (branded as Vauxhall in Britain), the European operation of America’s General Motors (GM). Few of the car-industry experts at the show, however, would call Opel a trophy.

The consensus was that GM was right to rid itself of a business that had lost money for 16 years straight. Opel has around 6% of the European market; that makes it too small and inefficient in a business where scale is key. It has been confined mostly to Europe for three reasons: the particular tastes of the region’s car buyers (for instance, for small diesel cars); tighter emissions regulations outside Europe; and GM’s fear of taking sales from its other brands further afield. The result has been to leave it boxed in and isolated.

Shorn of Opel, the American firm can redirect investment to China and America, where its profit margins are healthy, and to technologies such as autonomous cars and ride-sharing schemes. That bucks the conventional car-industry wisdom of gaining market share whenever you can. One insider questions whether GM is as committed to carmaking as it is to the technologies that will underpin mobility in future.

PSA’s adherence to carmaking is not in question. Buying Opel will propel it to second place in Europe with 16% of the market, overtaking Renault but behind Volkswagen (VW). But why Carlos Tavares, the firm’s chief executive, wants to stake his reputation on a full revival of Opel is less clear. Executives from a rival European carmaker suggest that revenge might be part of his motivation. Leapfrogging Renault may be satisfying for Mr Tavares, since its chairman, Carlos Ghosn, sacked him as number two in 2013 after he expressed a desire to run a big carmaker.

After that, Mr Tavares turned PSA around from a state of near-bankruptcy to solid profitability in under four years. If he could do the same with Opel his credentials would soar higher. Yet the cost-cutting that helped PSA will be hard to repeat.

Mr Tavares did at least get a good price—just €1.3bn ($1.4bn) for Opel and less than €1m for its finance arm. GM will still be responsible for massive pensions obligations. Mr Tavares reckons he can eventually save €1.7bn a year through economies of scale and other synergies. But most of the efficiency gains at PSA came from layoffs. Similar cuts at Opel will be much harder. Even if he can close factories, such as those in Britain, where labour laws are more flexible than in Germany and France, his plan to reinvent Opel as a brand suffused with German engineering prowess (and to fulfil PSA’s dreams of exporting beyond Europe) will probably depend on keeping thousands of workers employed in Germany.

The biggest headache for the combined company will be its over-reliance on Europe, which will account for over 70% of sales. Recent rapid growth in car sales in Europe is now slowing. And Europe is the world’s most competitive market: for mass-market carmakers, profits are much harder to eke out than elsewhere.

Whether or not Mr Tavares makes a success of the deal, it has given the car crowd a chance to speculate about further consolidation in the industry. One popular theory is that getting rid of Opel would eliminate GM’s overlap with Fiat Chrysler Automobile in Europe (FCA’s chairman, John Elkann, sits on the board of The Economist’s parent company). That in turn could open the way for a mega-merger. Sergio Marchionne, FCA’s boss, has long hoped to combine with GM to tackle what he sees as the industry’s needless duplication of investment—even if nowadays Mr Marchionne is talking more about merging with VW, which is still struggling to move on from its emissions-cheating scandal. It remains to be seen whether other car bosses share Mr Tavares’s appetite for an adventurous transaction.