After finding a home in Gujarat, Peugeot Citroën is opening up about the strategy to tap the Indian market. Business Standard is reporting that like Volkswagen, Nissan and Renault, Peugeot Citroën will follow a ‘Top Down’ approach in India.
Essentially what it means is the company will bring its niche products followed by mass market models. Most companies that enter a new market follow this approach because it is a safe bet.
When an automotive company enters a new market, it is strained for resources. With inadequate dealerships and service centers, targeting the masses can become a handful. Niche products can be easily sold and serviced and act as brand builders.
As the brand becomes stronger and the presence of the company is increased over the years, the company attains a stronger position to target masses. Going into segments on higher levels also provides less headaches as the competition is relatively low.
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After being on a house hunt for nearly a year, Peugeot Citroën has finally found its ‘Home sweet Home’. Unsurprisingly, it’s Sanand in Gujarat which is touted to be the next Motown for India. The French automaker will set up 4,000-crore facility at Sanand in Gujarat which is also home to our beloved Tata Nano and the new Ford factory.
Before finalizing the decision, the automaker was in talks in with Tamil Nadu and Andhra Pradesh but those discussions fell through and Gujarat grabbed the opportunity. This will be Peugeot’s re-entry in India after a decade.
Earlier they had a JV with PAL India but because of mutual disagreements they had to pull out of India. Now, the company is back in India and has plans to create one of the largest automotive factory over here. For now, this plant will manufacture a mid-sized sedan (possibly the 507) with an annual capacity of 3 lakh cars.
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French car manufacturer PSA Peugeot Citroen will put up a 4,000 crore rupee car plant at a site near Sriperumpudur in Tamil Nadu, Times of India has reported. Sriperumpudur is where Hyundai manufactures the i10 for every country in the world. Situated on the outskirts of Chennai, it is also known for the FIA approved MMSC (Madras Motor Sports Club) race track functioning since the late 80s.
This is the first major investment in the state after the state elections where the AIADMK swept out the DMK party and came to power. Peugeot officials were at the Chief Minister’s office yesterday to explain their plans and the course of action.
Peugeot follows other auto manufacturers like Ashok Leyland, Hyundai, BMW, Ford, Nissan, Renault, Mitsubishi and Royal Enfield into Chennai known as the Detroit of Asia.
Peugeot will roll out 300,000 cars per annum and a good share of volume will go to Europe and other emerging markets. The models Peugeot will manufacture here is not yet understood but chances are they could start their chapter with the 3009 MPV and 508 sedan.
Peugeot will provide employment to 20,000 people at the facility. PSA Peugeot is the world’s sixth largest car manufacturer and Europe’s second largest.
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Image – Citroen C5, a possible model for India
French car manufacturer PSA Peugeot Citroen has been eying an India return since ages. But in recent times, certain major decisions have been made they are shifting gears to find a place for their plant in India. The official announcement, sources inform, is bound to happen next year.
The senior officials at PSA have surveyed two sites in Andra Pradesh; One near Sri City in Chittoor district and another near Sitarampet in Ranga Reddy district. The company is now supposed to submit an official plan to the Government for approval. The plan will propose an investment of Rs 10,000 crore, including Rs 1,500 crore in the first phase, on the facility.
In return the Andra Pradesh government is expected to provide 900 acres land, a Rs 600-crore interest-free loan, 100 per cent value added tax (VAT) reimbursement for 21 years and physical infrastructure like roads, power and water among others.
So Andra Pradesh, are you ready to welcome your new guest?
French auto major Peugeot-Citroen has firmed up plans to re-enter the Indian market which it exited in 90s after poor showing of its 309 and worker agitations at its factory in Maharashtra.
Peugeot-Citroen is studying the possibility of setting up a production facility in Chennai. If it finalizes plans, the state will provide home for two biggest French car brands.
Rajeev Ranjan, principal secretary, industries department, government of Tamil Nadu -
We are in discussions with the company. The plant would be located near Chennai. Everything is still at the discussion stage at this moment.
Peugeot-Citroen is exploring several opportunities from assembling imported units to setting up a full scale production line on the outskirts of Chennai city. The Chennai city outskirts already boasts of industry giants such as Ford, Hyundai, Mitsubishi, Renault-Nissan and BMW.
Chennai has pockets consisting of many suppliers. It also produces many engineers and diploma holders who are highly eligible for jobs in the automotive industry.
Chennai has yet again become the centre of attraction with Peugeot–Citroen eying it as the location for their manufacturing facility of mid sized cars. Following most of the major auto manufacturers decisions to enter the emerging Indian market, Peugeot-Citroen as we reported earlier, is following suit.
In its previous attempt eleven years ago, Peugeot joined forces with Premier Automobiles, and rolled out the 309 model in India, which was a catastrophe.
With the sales falling at its home turf in the wake of the economic crisis, the manufacturer is looking at emerging markets for its business.
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