Believe it or not, Peugeot might be back in India by 2020

Peugeot may not be manufacturing and selling cars in India right now but they have a storied history with our country. The first time they were here in the nineties, Peugeot shut shop and exited due to a botched joint-venture with the erstwhile Premier Automobiles Limited (PAL). The 309, their sole offering at the time, had been received well with backlogs stretching into hundreds, if not thousands. The sudden decision from PAL and Peugeot to call off the joint-venture left the investors and the customers in the lurch with Peugeot's brand reputation taking a royal beating.

When the folks at PSA, the parent company that owns Peugeot and Citroen brands, decided the time was ripe for Peugeot to come back to India, Sanand in Gujarat was chosen as the location for setting up the plant. Well, this time, it didn't move beyond press releases and participation at the Auto Expo as the prevailing financial crisis in Europe left PSA with no cash reserves for a substantial investment in India. They tried to ink a deal with General Motors to use the latter's facilities to roll out the 207 and the 508 but, for reasons best known to the them, the deal didn't go through.

India is too big a market for car-makers to ignore and with hopes of a fresh start, the PSA Group has now entered into an agreement with the CK Birla Group, which owns Hindustan Motors (HM). Two joint-venture agreements have reportedly been signed, one for the assembly and distribution of cars with PSA holding the majority stake and the other a 50:50 joint-venture with AVTEC Limited, a HM subsidiary, to manufacture and supply powertrains for PSA vehicles. HM's facility at Thiruvallur near Chennai and AVTEC's plant at Hosur are likely to be the locations for the two ventures.

This agreement is claimed to be a long-term partnership between the two conglomerates with a claimed initial investment to the tune of 100 Million Euros (Rs.700 Crore). The first cars from this joint-venture are expected to roll out by 2020.

The sign-off was done in Paris yesterday in the presence of Mr. Carlos Tavares, Chairman of the Managing Board of PSA Group and Mr. CK Birla, Chairman of the CK Birla Group.

While we are glad about Peugeot's potential re-entry and Citroen's debut here in the country, what's going to be crucial is PSA sticking to their words and being committed to the Indian market. Our country is unforgiving. Ask Fiat, who has never really recovered from a disastrous joint-venture with PAL in the nineties despite their continuous efforts all these years backed by wonderful products. We hope the folks at PSA aren't heading down the same path and are actually serious about India this time around.

That said, with their distinct and quirky styling, Peugeots and Citroens would certainly make Indian roads more interesting to look at!

No comments:

Post a Comment