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UPDATE 1-GM, Peugeot mull joint venture -report

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PARIS, Oct 12 (Reuters) - General Motors and PSAPeugeot Citroen are working on plans for a jointventure as they flesh out the carmaking alliance announcedearlier this year, La Tribune reported on Friday.

Detroit-based GM would place Opel in the 50-50 venture alongwith its French partner's core manufacturing division, accordingto the newspaper, which cited anonymous sources.

GM and Peugeot both declined to comment on the report, whichalso said the U.S. automaker could inject more cash into thejoint venture. " We haven't commented on previous reports andwe're not going to on this one," Peugeot spokeman JonathanGoodman said.

Peugeot "remains focused" on operational working groups dueto report back by the end of the month on several potentialjoint vehicle programmes, Goodman said.

Peugeot shares rose on the report and were 4 percent higherat 1443 GMT, while GM stock was down 0.2 percent.

The U.S. automaker paid 320 million euros for a 7 percentstake in Peugeot in March as part of the original alliance deal,though the French automaker's shares have since plunged.

But the proposal is likely to run into objections from theFrench government and has yet to be submitted to the Peugeotboard, the report added.

GM and Peugeot announced their alliance plans in lateFebruary with the goal of saving at least $2 billion annuallywithin five years, evenly split between the partners.

Paris-based Peugeot outlined five possible joint vehicleprogrammes following talks with unions in March: a family ofsmall cars for emerging markets; larger sedans; a fuel-efficientsubcompact design; compact crossovers or SUVs; and a dual-clutchtransmission.

(Reporting by Laurence Frost and Ben Klayman; Editing by JamesRegan and Christian Plumb)

((laurence.frost@thomsonreuters.com)(+33 1 49 49 56 83)(ReutersMessaging: laurence.frost.thomsonreuters.com@reuters.net))

Keywords: GM PEUGEOT/JV