Peugeot may drop plans for an Indian venture

Peugeot is braving some rough weather back home which is a serious cause of concern for us in India. The French automakers are having a tough time dealing with their financial burdens. Peugeot manufacturers seem to close shop even before execution of plans commenced. We are talking of the interest the car makers had shown in setting up plant back here in India. Peugeot’s rough times have been indicated by certain major changes in their game plan. They opted out of the Le Mans racing circuit in America, giving the Audi a free reign. They are looking for a tie up with their Italian rivals, the Fiat to take down the major competition in the form Volkswagen back in Europe. Moreover Peugeot has been downsizing in the last two years, doing away with 6000 jobs this year. And if figures hold true, the company is losing ground at an increasing pace, with its dismal sales figures that suggest it has sent out only 3.5 million vehicles, a clear 1.5 percent less than last year. And with the rumors of going back on their Indian venture plans doing the rounds, it does seem the automakers are knee deep in a financial crisis.

Peugeot may drop plans for an Indian venture

Though nothing official has been announced in terms of termination of the project, but word has got out that the French manufacturers will hold off their plans to a later date, postponing it for the time being. Their spokesperson has put some rumors to rest, (for the time) stating that the company doesn’t plan on giving up the proposed venture, but has just wished to start with the project to a later time, until their financial crisis has subsided, perhaps.

In September, the company announced of investing a whopping amount of 650 million Euros on Indian ground, to roll out their proposed product the 508 midsize sedans.  It was initially predicted that the sedan would have an early 2014 launch but given the present turn of events, the unveiling will be perhaps in 2015; i.e. if the plans don’t get benched in the meantime.  The company had set up its office in Mumbai, but has closed it down temporarily. This (as confirmed by their spokesperson) is due to the shifting of base from Mumbai to Ahmedabad. He also stated that the plans of setting up the office in Ahmedabad will be underway as soon as a site has been fixed upon.

Peugeot had proposed to set up shop in Sanand, Gujarat becoming the third automakers after Tata motors and Fiat to opt for the Western state. The factory is, as of now, supposed to churn out around 17000 vehicles in a year. This initiative was taken since the company had laid down plans to churn out revenue elsewhere outside their European domain. They intended to get a feed of more than fifty percent of their sales from outside Europe.

As we have already mentioned, no official word is out yet, but plans are put on hold for now until Peugeot gets itself out of the muck. But if it does materialize then Gujarat can be in for another financial uplift. With Tata and Fiat already investing in the Sanand, this will be another extremely fortunate turn of events, if Peugeot also pitches tent.

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