Peugeot back in India?

[ph03n!x]

Source

Europe's second largest automaker PSA Peugeot Citroen is scouting for a manufacturing location in Tamil Nadu and Andhra Pradesh, amid its Indian re-entry plans getting slowed down by the global downturn.

According to industry sources, the company, which conducted consumer clinics in October last year with market research firm IMIRB, is looking at bringing its hatchback 307 and sedan C5 in India.

It has already had discussions with the Automotive Research Association of India to understand the regulations and homologation (making the vehicles meet the Indian rules and norm) needs for its products, the sources said.

Company representatives have already met the government officials of Andhra Pradesh and Tamil Nadu in its quest for a location to set up its plant, they added.

With the segment in which it is present not economically viable to be launched through direct imports, it is understood that the company is looking at launching its cars only after having a manufacturing unit in India.

When contacted PSA Peugeot Citroen, Vice-President India Rajesh Nellore confirmed meeting officials from the Andhra Pradesh government to discuss investment opportunities, which he said "were preliminary in nature".

Nellore, however, said: "The global economic crisis has slowed the plans and that the company is strongly in favour of operations in India as and when conditions become favourable."

PSA Peugeot Citroen is no stranger to India having entered into a partnership with the erstwhile Premier family resulting in the joint venture Peugeot PAL India.

In 2001 it pulled out from the JV and is currently actively sourcing components from India. The firm had opened an office in Chennai in October 2008.

We have a Peugeot 309 GL (Petrol), and it is one hell of a car to drive - in spite of its looks and lack of features, i used to love pushing it in the East Coast Road... Looks like we can see more such spirited cars!

[Parm]

i have my doubts if PSA will come and establish themselves in india!

[aaggoswami]

I doubt their re-entry. They will take atleast 5 years to build one plant and one year from now to take decision where to build one plant. They will have to establish new sales and service network which is not a small task.

About their products, well they dont have proper petrol motors, the reason why they are in JV with BMW and with Fiat for diesel motors. The last good heard engine was the 1586cc 110 bhp diesel. It is still available. What will they come up with. With their detuning technique + heavy weight of cars, the FE will go down as engines wont perform optimally. If they tune it for FE, performance will go below par.

Their cars are good to drive even today and from what I have read, they dart into corner with certain amount of enthusiasm. Chassis are really sorted out. Safety is top notch with most of the offerings doing 5/5 in EuroNCAP. But its other areas where they will not succeed.

1) Strong motors. Look at Altis, G3HC as example for petrol engines and Fiat SDE for diesel.

2) A.S & S. Show me one European that is good for A.S & S. The Indian customer will not be able to trust any European manufacturer fast and this is Peugeot with a bad experience in India.

3) Pricing. Under the pretext of quality, they cannot charge more. Also they have habit of pricing the car higher and calling it premium car. Common with europeans. Essentially differently badged Peugoets will be avialable at higher cost as Citroens.

A lot of issues and a lot of money required.
All their hatchbacks are heavyweights so FE, a must for small car in India will have to watched out for.
For their sedans, they must come up with 407 at Rs. 10 lakh with a good 2.0 ltr diesel to sustain. If they start with this, they will find some success.

[suprateep]

Originally Posted by Parm

i have my doubts if PSA will come and establish themselves in india!

well I am sure that Puegot would not repeat the mistake - they probably may come in with a JV of sorts supplying essential critical parts (read engines) and other components. While the build quality and technology has never been suspect the major problem with Puegot in India has been the woeful A.S.S. and I am sure Indians did not forget the first run.

It would be difficult for a smallish player to establish itself in India without investing first majorly in setting up the infrastructure - which I am sure Puegot as present does not have any plans to.........

[ImmortalZ]

Doesn't Peugeot cars have some of the lowest reliability ratings? Do we need another brand which spends more time in the workshop than in the road?

[ph03n!x]

Am not sure about their modern cars - the 309 GL Petrol that my dad bought in '96 has a gem of an engine - carbureted though - and returns anything around 12 ~ 14 KMPL of mileage.

Apart from the service & spares problems we faced after they shut shop, the biggest problem is that the dashboard is kinda falling apart - and we are not getting a viable option to source a replacement!

[agspins]

Even if PSA plans to renter indian market,its going to take another 3 years to setup up a assembly and other required infrastructure like dealerships etc.Rather it can take a different route i.e contract manufacturing with company similar to Argentum Motors,
where they will just have to take care of dealership network that they can do with a partner...

[deepakhon]

Does PSA Peugeot have some cases pending against it in Indian courts? I have heard so, not sure whether I am right. If yes, isn't it a burden for them to settle them?

[sajands]

Originally Posted by deepakhon

Does PSA Peugeot have some cases pending against it in Indian courts? I have heard so, not sure whether I am right. If yes, isn't it a burden for them to settle them?

That's true, Peugeot does have few cases pending against it in Indian courts and I guess they need to clear thoes first before they can start of production.

[Steeroid]

They must be nuts - there would still be a mob of investors waiting to bash them up.

The french are crazy. Koi barosa nahin.