Peugeot to re-enter India with a mid-sized sedan

Friday 16 September 2011, 18:09 PM by

The lull in the PSA Peugeot Citroen's camp recently bid adieu as Europe's second largest carmaker Peugeot announced plans to re-enter the Indian market with a mid-sized sedan. The car is expected to be seen on the Indian roads by 2014. PSA Peugeot Citroen has finally opted for Sriperumbudur near Chennai to set up its India car plant. The plan for India, shared by Peugeot, has been initiated almost ten years after its exit from the country.

The French company had some changes in the strategy that was built for India, following which, in 2009, Peugeot decided to slowdown the pace at which it usually started off fresh operations in India. The move was justified by putting light on the menace of global economic slowdown, where in, India was gripped badly. Peugeot Citroen has decided that it will set up a plant in India to manufacture the vehicle that marks the re-entry of the carmaker in the Indian market. However, the location at which the plant will be laid is still under consideration but is expected to be finalised soon.

In India, Peugeot will come out with its first mid-size sedan. The rolling out of the mid-sized sedan in China and Europe is also a part of the plan. However, the production operations and the process of rolling out would be in its full swing only between 2015 and 2020. At this time, Peugeot is believed to establish a strong base in the regions it is targeting for its mid-sized sedan introduction. As the carmaker gets use to the needs, demands and expectations of the local buyers and the trend that dominates the local auto market, it will be able to keep a vigilant supervision on the costs.

The French carmaker is also expected to shake hands with Mitsubishi for the production of a global small car; however, such a move by Peugeot is still not confirmed officially. On the lines of such speculations, another news that has been doing the rounds is that, Peugeot may source its diesel engines from Ford's plant, near Chennai.

The company said in a statement that "Peugeot is pleased to announce its intention to enter the Indian market with both commercial and industrial operations. The brand will produce, as a first step, a mid-sized sedan car."

The French car company confirmed that it aims to sell 50 percent of its total vehicles outside Europe by 2015. This shows that the target for which Peugeot is going this time is quite high as compared to the 39 percent sales that was achieved in 2010.

PSA Peugeot Citroen Executive Vice President (Asia) Gregoire Olivier said that, "India is a key market and this new implantation reflects our ambition to become a global player. As in China, we will offer Indian customers vehicles adapted to their expectations."

It is important to note that PSA Peugeot Citroen has its footprints imprinted on the Indian soil, from a very long time. It entered into a partnership with Premier Automobile Limited (PAL), resulting in a joint venture named Peugeot PAL India. However, the carmaker went out of the partnership in 2001.

A very pertinent question that arises is that, whether Peugeot would be successful in its mission to grab a market share in India or it will be a fiasco. If critics are to be believed, the journey of the carmaker is going to be tough, especially with legendary competitors such as Maruti, Hyundai, Toyota and Ford existing firmly in the market.

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