Philippe Varin, Chairman, Peugeot Citroen, the French auto manufacturer, had earlier ventured with Tata Steel from years 2007-08, and did witness Tata’s voyage from Singur all the way to Sanand in Gujarat. The experience with Tata Steel does explain why Varin chooses Sanand while the company plans its re-entry to India. Varin answered some questions regarding the future plans of Peugeot in India and says Peugeot would also be focussing on hybrid products apart from the already present compact and sedan (B/C/D) segments.
Varin outlines India as a critical automobile market for Peugeot. He tells most recently they have had 2 ventures jointly in China. They have made their presence felt in Argentina and Brazil and set up a facility in Russia too. He told Peugeot was 2nd in Europe with a market share of 14%, so that would make India the place to focus currently. He tells by 2020 India would be the 3rd biggest market and Peugeot would be offering their consumers their design expertise, affordable products and style using latest technology. They would be bringing in a host of cars that were top in the B/C/D segments. In 2014, they would be starting with model 508. In segment C, they would be making adjustments to their products suitable for Indian consumers to their requirement. Peugeot has tied up with BMW and Ford for gasoline and diesel engines respectively. He also told they had hybrid electric and hybrid diesel cars, which would be giving 30 km/litre mileage.
When questioned about the current situation in Indian market with sales a bit down in major segments, Varin answered their decisions are not based on monthly sales records. He tells there would be 600 cars for 1000 people in Europe, in China there would be 35 cars for 1000 people and here it was a paltry figure of 12 cars for 1000 people. He felt potentially there was a rise in GDP and income per person too. He feels the middle class in India is large, infrastructure wise he sees things coming up and that market would only multiply from here on and it all depended on how they look into it. He tells 45% of their entire market constituted their targeted (B/C/D) segments, and it was meaningless to be going below it.
When asked about their decision to come to Gujarat instead of Tamil Nadu, Varin says the decision was indeed difficult when it came to incentives and value proposition. He elaborated Peugeot had found in Gujarat a Greenfield site that was well networked, a very good business climate, excellent location and was connected well with Western and Northern India where he felt most of their customers would be. He also told the Gujarat Government agreed to partner them in order to set up the ASDI (Automotive Skill Development Institute) to allow for the industry’s requirements. He told the Gujarat Government had shown its commitment to be known as a global hub for automobiles . Varin tells Peugeot finds an opportunity in Gujarat for creating an automobile hub, and tells Ford and Tata were already there.