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-   -   Peugeot ditches Gujarat Factory plans. GM unwilling to let Peugeot use its plants (https://www.team-bhp.com/forum/indian-car-scene/119731-peugeot-ditches-gujarat-factory-plans-gm-unwilling-let-peugeot-use-its-plants.html)

Peugeot had earlier announced that it will build a full production facility at Sanand, Gujarat (Link to Post). 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

Scoop : Peugeots spotted testing

Peugeot's 2nd innings in India

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.

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.:Frustrati

GTO - Did not quite get as to what you meant by Puegot not honoring delivery commitments for 309, had they started taking the bookings? stupid:

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.

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.

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.

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 clap:


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.

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

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!

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.

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.

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.

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.

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.

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 :Frustrati

So true, Aaggoswami! Here's a great article for you.

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 :D

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

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.