Peugeot in talks with TATA Motors for it’s relaunch in Indian market

Not even old timers would remember the French carmaker Peugeot who had a small presence in India, but things might just change for PSA Peugeot Citroen as they are in deep discussions with TATA Motors for a joint venture which could help Peugeot with quick entry and ready set-up of dealer network, manufacturing facilities along with a trusted name to partner with.

If sources are to be believed, the Indo-French JV might include sharing of engine technology. The Peugeot management plans to utilize the Tata’s Sanand plant in Gujrat which was commissioned for making the Nano, however with the ‘cheapest car’ not selling in enough numbers, the capacity utilization has been low.

PSA, which has emerged stronger under chairman Carlos Tavares after a French-Chinese bailout, is reviewing its foreign plans. These include exploring the possibility of launching the 208 hatchback, 308 sedan and the 2008 crossover in India, a market the French company exited a decade-and-half ago after making a brief appearance. Earlier in 2012, the company planned an India comeback with a potential investment of 650 million euro and a tie-up with GM for utilizing their facilities here but developed cold feet amongst global turmoil and slowdown to scrap their investment and tie-up.

Emmanuel Delay, head of India Pacific Operation at the PSA Group, is steering discussions with senior executives of Tata Motors, including president and head of product engineering Tim Leverton and chairman Cyrus Mistry, sources said. He recently visited Bombay House, the Tata headquarters in Mumbai, to discuss the details of a possible Peugeot Tata JV .

If the deal goes live, both parties would gain a lot with Peugeot getting an almost ready set-up, a virtual red carpet for its India entry, potentially saving them of millions of dollars in order to setup everything from scratch. As for the Indian manufacturer, its facilities could be utilized a lot more cutting down on the losses incurred and a bonus would be access to one of the best engine families in the world.

Source: ETAuto

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