Tuesday, January 31, 2012
By Manoj Kumawat
Peugeot plans could defer its reentry in India
On the one hand where car brands such as Mini and others have pitched in their tents in Indian car market, European car maker Peugeot is said to rethink its reentry plans for India. As per reports, Peugeot is in the process of closing its office in Mumbai. Earlier this year, Peugeot has planned to bring Peugeot 508 sedan in India through the completely built unit in 2014. The present decision amidst further investment plans laid for India is seen as a big blow to Indian car industry and Peugeot as well.
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PSA Peugeot Citroen has earlier planned to invest Rs 4,500 in India and has also chosen Sanand in Gujarat as its destination for its car plant in India. The car maker had also decided to produce around 170,000 cars per year. Peugeot cars including Peugeot 508, Peugeot 208 hatchback and Peugeot 208 based SUV were all scheduled to be for India. At the recent Auto Expo in New Delhi, it was believed that Peugeot has an aggressive strategy for India. If such was the case then what really went wrong with Peugeot? Is it the growing competition in India or there is something else behind this roll back.
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Sources suggest that the decision of a call back by Peugeot must be seen in the light of the present economic slump going on in Europe. In such a grim scenario, Peugeot is expected to adopt a frugal strategy in India and plans to have a return from every penny invested in the country. The current decision could also be a blow to Gujarat which was soon becoming an auto industry hub with many car makers entering Gujarat after the Tata Nano plant. The present scenario is no surprise as is evident by the job cut plan of over 6000 employees in 2012 by the car maker taking recourse of the economic challenge going on in Europe.
