PSA, the parent company that makes Peugeot, Citroen and DS cars is coming to India! PSA (Peugeot Citroen Motors) has signed a joint venture agreement with CK Birla Group to make and sell vehicles and components in India by 2020. PSA will invest about Rs 700 crore into a production facility in Chennai. The new joint venture will use the same plant in Chennai that is being used by Hindustan Motors and Mitsubishi along with the same distribution networks used by the former.
As per the agreement, the PSA Group will have a majority stake in the assembly and the distribution of Peugeot, Citroen and DS cars in the joint-venture company being set-up with HMFCL (Hindustan Motors Finance Corporation Limited). The second part of the agreement will be a 50:50 joint venture between the PSA Group and AVTEC for the manufacture and supply of powertrains. Both manufacturing of full vehicles and components will be handled out of the same production facility in Chennai.
To begin with, the initial capacity at the Chennai factory is said to be about 1 lakh units a year. Plans to increase production and support a progressive ramp up of the factory will depend on the number of vehicle sales and overall demand. The power plant facility which will serve both internal demand and international markets. PSA aims to increase localization to a very high level in their cars to be very competitive in India’s cutthroat auto sector.
Commenting on the agreements, Carlos Tavares, Chairman of the Managing Board of PSA Group said: "Benefitting from the strong support of our Indian partner, the CK Birla Group, and a shared vision, this project is consistent with the strong execution of our Push to Pass strategic plan and represents a major step in PSA Group’s worldwide profitable growth in key automotive markets.”
Mr. CK Birla, Chairman, the CK Birla Group, said “I am confident that the coming together of the latest state-of-the-art technology from the PSA Group and the engineering and manufacturing excellence of the CK Birla Group will benefit the automotive sector in India.”
Although an announcement has officially been made, expect an actual launch from PSA to still be a few years away. We expect a product launch in either 2019 or the 2020 Indian Auto Expo.
(This story has not been edited by NDTV staff and is auto-generated from a syndicated feed.)
