Go Back   Team-BHP > BHP India > The Indian Car Scene


Reply
 
Thread Tools Search this Thread
Old 26th April 2012, 12:46   #1
GTO
Team-BHP Support
 
GTO's Avatar
 
Join Date: Feb 2004
Location: Bombay
Posts: 45,185
Thanked: 72,220 Times
Default Peugeot ditches Gujarat Factory plans. GM unwilling to let Peugeot use its plants

Peugeot ditches Gujarat Factory plans. GM unwilling to let Peugeot use its plants-207.jpg

Peugeot had earlier announced that it will build a full production facility at Sanand, Gujarat (Link to Post (Peugeot coming back to India *Update* Manufacturing facility to be located in Gujarat)). Well, that plan is history now. Reason?

Peugeot is facing really tough times in Europe, which is its primary market. Demand continues to wane in France & other European countries. The current cash reserves simply do not permit any substantial investments in India. The original plan was to invest to the tune of Rs. 4,000 crore toward the Gujarat factory. Peugeot recently entered a global alliance with General Motors to save on costs; that is, joint purchasing of components and development of future cars & platforms. GM also gets a 7% stake in Peugeot.

Reuters quotes Gregoire Olivier, head of Peugeot's Asian operations, as stating "We're not going to move forward by building our own factory as we'd planned to...We now have GM as a global partner, and GM has factories in India, so we're obviously reviewing our plans from the top. There are a lot of other ways to enter India now that they don't require us to put 600 million Euros on the table"

Peugeot's marred reputation in India might have triggered doubts over the project's viability. Rolling cars out from GM's facility substantially lowers the required investments and, more importantly, the risk exposure if things don't work out for Peugeot India. Will the Indian customer put money down on a brand that failed to honour all delivery commitments of the 309 sedan, and didn't refund booking deposits either?

It can be safely concluded that Peugeot's cars will be assembled at GM's facilities at Halol (Gujarat) and Chakan (Maharashtra). The product range being considered is the Peugeot 207 & 508. GM India might not have a problem with assembling the 508 luxury sedan, but will it build the 207 hatchback that can very well compete with its own hatchback range?

Interesting times ahead.

Related Threads:

Peugeot at the 2012 Auto Expo (Peugeot (including 508 sedan) @ Auto Expo 2012)

Scoop : Peugeots spotted testing (SCOOP Pics : Peugeot (207, 508) spotted testing on the MH Expressway)

Peugeot's 2nd innings in India (Peugeot's second Innings- Welcome back, Not Really!)

Peugeot ditches Gujarat Factory plans. GM unwilling to let Peugeot use its plants-508.jpg
GTO is offline   (3) Thanks Reply With Quote
Old 26th April 2012, 12:54   #2
BHPian
 
avira_tk's Avatar
 
Join Date: Nov 2011
Location: Bangalore
Posts: 605
Thanked: 546 Times
Default re: Peugeot ditches Gujarat Factory plans. GM unwilling to let Peugeot use its plants

Peugot has the reputation of being a fly-by-night operator after their first innings, I am sure they are planning this so that if it bombs, the only cost will be one way tickets to France.
Their cars are finding it tough to survive in the European markets, for which they were designed - how will they sell in India? Saying made by GM will make most people cringe.
avira_tk is offline   (1) Thanks Reply With Quote
Old 26th April 2012, 13:03   #3
Senior - BHPian
 
ghodlur's Avatar
 
Join Date: Sep 2009
Location: Thane
Posts: 4,867
Thanked: 1,846 Times
Red face re: Peugeot ditches Gujarat Factory plans. GM unwilling to let Peugeot use its plants

So does this news indicate that the Puegot will be planning to sell their products through GM dealership too or will they attempt to venture out on their own. Also will there be technology transfer in the offing?

This is Gujarat's loss too.

GTO - Did not quite get as to what you meant by Puegot not honoring delivery commitments for 309, had they started taking the bookings?
ghodlur is offline   Reply With Quote
Old 26th April 2012, 13:07   #4
Distinguished - BHPian
 
shankar.balan's Avatar
 
Join Date: Apr 2008
Location: BLR
Posts: 7,868
Thanked: 4,927 Times
Default re: Peugeot ditches Gujarat Factory plans. GM unwilling to let Peugeot use its plants

Nice vehicles and reasonable brand too. Poor management strength and lousy decision making ability from all observations.

I dont think either Peugeot OR Renault can make even the kind of dent that the VAG group have done, in India, unless there is a radical change in their approach itself.
shankar.balan is offline   Reply With Quote
Old 26th April 2012, 13:13   #5
BHPian
 
revintup's Avatar
 
Join Date: Jun 2011
Location: Kottaym
Posts: 379
Thanked: 241 Times
Default re: Peugeot ditches Gujarat Factory plans. GM unwilling to let Peugeot use its plants

Quote:
Originally Posted by ghodlur View Post

GTO - Did not quite get as to what you meant by Puegot not honoring delivery commitments for 309, had they started taking the bookings?
He was referring to the old 309 when it was launched in india, in the 90s. It was a sales flop and the company wound up leaving all the owners stranded.
revintup is offline   Reply With Quote
Old 26th April 2012, 13:21   #6
Distinguished - BHPian
 
deetjohn's Avatar
 
Join Date: Sep 2006
Location: Kochi
Posts: 3,633
Thanked: 5,792 Times
Default re: Peugeot ditches Gujarat Factory plans. GM unwilling to let Peugeot use its plants

Quote:
Originally Posted by GTO View Post
Interesting times ahead.
It again looks a halfhearted approach isn't it? Though this time around, Peugeot seems to be very clear about the exit strategy.

The deal with GM will reduce the risk for sure. But then the returns as well. I hope GM doesn't get to veto the products.

Would love to see the 208 here.
deetjohn is offline   (1) Thanks Reply With Quote
Old 26th April 2012, 13:21   #7
Senior - BHPian
 
kiku007's Avatar
 
Join Date: Apr 2005
Location: Brisbane
Posts: 1,564
Thanked: 1,087 Times
Default re: Peugeot ditches Gujarat Factory plans. GM unwilling to let Peugeot use its plants

A disastrous first innings with PAL, then walk out of Tamilnadu saying land wasn't given and now walk out of Gujarat saying we are going to join hands with GM


PR disaster. A brand cannot be more uncertain about their plans for India.

Peugeot's uncertanity + GM's snail pace in launching products is a competitors delight.

Last edited by kiku007 : 26th April 2012 at 13:23.
kiku007 is online now   (1) Thanks Reply With Quote
Old 26th April 2012, 13:25   #8
Senior - BHPian
 
greenhorn's Avatar
 
Join Date: Apr 2007
Location: TN-14
Posts: 6,606
Thanked: 916 Times
Default re: Peugeot ditches Gujarat Factory plans. GM unwilling to let Peugeot use its plants

Oh man, the jokes about french tanks having 5 reverse and 1 forward gears just write themselves

I think Peugeot has taken more steps backward than forward in India. The market has still not forgiven fiat, even though they never left. lets see how These guys fare!
greenhorn is offline   (8) Thanks Reply With Quote
Old 26th April 2012, 15:16   #9
GTO
Team-BHP Support
 
GTO's Avatar
 
Join Date: Feb 2004
Location: Bombay
Posts: 45,185
Thanked: 72,220 Times
Default re: Peugeot ditches Gujarat Factory plans. GM unwilling to let Peugeot use its plants

Quote:
Originally Posted by ghodlur View Post
Did not quite get as to what you meant by Puegot not honoring delivery commitments for 309, had they started taking the bookings?
Quote:
Originally Posted by revintup View Post
It was a sales flop and the company wound up leaving all the owners stranded.
I also meant the potential owners who booked a 309 and never got their car. Worse still, they have - till date - not been refunded back their booking deposits. Peugeot should first return all pending booking amounts. It doesn't matter whether it is they who are responsible, or Premier Auto (their ex-partner). In the eyes of the customer, they booked a Peugeot car. Huge PR loss for only a handful of crores in rupees.

Quote:
Originally Posted by shankar.balan View Post
Poor management strength and lousy decision making ability from all observations.
Something all non-German Euro brands appear to suffer from. Fiat, Peugeot, Renault...the list just goes on. On the other hand, VW, Skoda, Mercedes, BMW & Audi are doing rather well.
GTO is offline   Reply With Quote
Old 26th April 2012, 16:01   #10
BHPian
 
mac187's Avatar
 
Join Date: Apr 2009
Location: Singapore
Posts: 523
Thanked: 294 Times
Default re: Peugeot ditches Gujarat Factory plans. GM unwilling to let Peugeot use its plants

Let me get this straight. They do not want to build a full fledged plant because that would mean speading alot of money (Read: Difficult for a quick getaway). But they expect Indian customers to buy their cars never knowing when they will shut shop and leave?

The first thing a new manufacturer does is invest money in the current or plans a road map to investments to show their commitment to the country and their customers. I wonder if GM is going to gain anything for this, there are higher chances of them denting their brand in this alliance with Peugeot.

Last edited by mac187 : 26th April 2012 at 16:04.
mac187 is offline   Reply With Quote
Old 26th April 2012, 16:30   #11
Senior - BHPian
 
aaggoswami's Avatar
 
Join Date: May 2007
Location: Vadodara
Posts: 4,591
Thanked: 1,215 Times
Default re: Peugeot ditches Gujarat Factory plans. GM unwilling to let Peugeot use its plants

Quote:
Originally Posted by greenhorn View Post
I think Peugeot has taken more steps backward than forward in India. The market has still not forgiven fiat, even though they never left. lets see how These guys fare!
Peugeot entered India in the segment of Esteem and Cielo, both of them were considered as a more than higher middle class's car. So not all are aware of Peugeot making a big dent IMO. Yes, negative image is there, but not as much as Uno which was in small car segment against Zen. So its a bit different game for Peugeot. Fiat stayed back and created disaster after disaster, one after another. Be is spare not available problem to lethargic service. All these things continued to give more and more negative impression of Fiat. Again Peugeot, being absent wont have such an uphill task. Fiat's ultimate blunder was MOU with Tata. Though they have managed to survive, they are barely into the market.



GM is doing much better than Fiat and also is atleast on buyer's radar.

Quote:
Originally Posted by GTO View Post
Something all non-German Euro brands appear to suffer from. Fiat, Peugeot, Renault...the list just goes on. On the other hand, VW, Skoda, Mercedes, BMW & Audi are doing rather well.
At the same time, almost none of them are successful at JV ( Renault-Nissan is different thing altogether ). Be it VW-Suzuki, or Fiat-Tata or Fiat-PAL or Pal-Peugeot or Mahindra-Renault.
aaggoswami is online now   (1) Thanks Reply With Quote
Old 26th April 2012, 16:43   #12
BHPian
 
driving_smartly's Avatar
 
Join Date: Nov 2008
Location: Navi Mumbai
Posts: 476
Thanked: 211 Times
Default re: Peugeot ditches Gujarat Factory plans. GM unwilling to let Peugeot use its plants

Quote:
Originally Posted by GTO View Post
I also meant the potential owners who booked a 309 and never got their car. Worse still, they have - till date - not been refunded back their booking deposits.
My father was one of the prospective buyers for 309 for which he had shelled out Rs 38000/- as initial booking amount in 1992/93. His efforts in getting back the booking amount was in vain with repeated attempts
driving_smartly is offline   Reply With Quote
Old 26th April 2012, 18:45   #13
GTO
Team-BHP Support
 
GTO's Avatar
 
Join Date: Feb 2004
Location: Bombay
Posts: 45,185
Thanked: 72,220 Times
Default re: Peugeot ditches Gujarat Factory plans. GM unwilling to let Peugeot use its plants

Quote:
Originally Posted by aaggoswami View Post
At the same time, almost none of them are successful at JV ( Renault-Nissan is different thing altogether ). Be it VW-Suzuki, or Fiat-Tata or Fiat-PAL or Pal-Peugeot or Mahindra-Renault.
So true, Aaggoswami! Here's a great article for you.

Quote:
Originally Posted by driving_smartly View Post
My father was one of the prospective buyers for 309 for which he had shelled out Rs 38000/- as initial booking amount in 1992/93.
You mean 1995 - 1996? I had checked out the 309 too, and was bowled over by its suspension (especially when you consider the competition at the time). Luckily, we switched to a Maruti Esteem VX which served us very well for the next 11 years & 200,000 kms
GTO is offline   (1) Thanks Reply With Quote
Old 27th May 2012, 19:13   #14
Senior - BHPian
 
wilful's Avatar
 
Join Date: Oct 2007
Location: cochin
Posts: 1,050
Thanked: 749 Times
Default re: Peugeot ditches Gujarat Factory plans. GM unwilling to let Peugeot use its plants

The Times of India/Zigwheels link today talks of Peugeot 301 coming to India in 2013. It also mentions Gujarat as the manufacturing base. The styling looks impressive.
Peugeot 301 coming to India soon| Zigwheels.com
wilful is offline   Reply With Quote
Old 27th May 2012, 19:24   #15
BHPian
 
Join Date: Nov 2006
Location: kolkata
Posts: 927
Thanked: 24 Times
Default re: Peugeot ditches Gujarat Factory plans. GM unwilling to let Peugeot use its plants

Autocar states that GM can’t lend its manufacturing capacity to Peugeot as it’s using the same to maximum for itself; Peugeot needs to find some other alternative. This was my understanding at least of what I heard.
musicmanaman is offline   Reply With Quote
Reply


Thread Tools Search this Thread
Search this Thread:

Advanced Search


Similar Threads
Thread Thread Starter Forum Replies Last Post
A road trip to Gujarat - Kuch din to gujaro Gujarat me for_cars1 Travelogues 23 2nd November 2016 08:42
How do you deal with Service Centers unwilling to acknowledge a problem? bykerdawg The Indian Car Scene 5 2nd September 2014 10:52
Peugeot coming back to India *Update* Manufacturing facility to be located in Gujarat ph03n!x The Indian Car Scene 114 3rd November 2011 19:54
2011 i10 Asta A/T - its Korean, its new, its fast, its red, and its coming. nirupesh Test-Drives & Initial Ownership Reports 1 8th January 2011 10:45
Its not the size, its how you use it. Rtech Shifting gears 13 13th May 2006 11:44


All times are GMT +5.5. The time now is 09:42.

Copyright ©2000 - 2017, Team-BHP.com
Proudly powered by E2E Networks