Mahindra and Peugeot heading for a tie-up?

Sourcing of technology, sharing of production capacities and joint investments are reported to be on the cards between India’s Mahindra & Mahindra and French auto major Peugeot. This was revealed by top auto industry sources in India as well as in France.

Mahindra and Peugeot heading for a tie-upNo official statements have been given by Mahindra & Mahindra, however an email from PSA Peugeot has confirmed that the French major is actively involved in a drawing a strategy for India as it is a very important auto market.

As per Times of India, this liaison between M&M and Peugeot will include sharing of production capacities wherein Mahindra will permit Peugeot to use their facilities in India while Peugeot could offer Mahindra sharing of their plants across Europe for local production in the region. Sharing of engine technology and specifically where diesel engine and diesel hybrid technology is concerned is also on the cards.

Large scale investment is also being planned my Mahindra in Peugeot as part of this agreement though it is not yet ascertained if there will be counter investments by Peugeot in the Indian auto major. Peugeot has long been looking into a return into India’s auto sector following two previous attempts, one of which was setting up a plant in Sanand, Gujarat (see below). Both did not see much success, mostly due to financial crisis. But now, Peugeot is out of those crisis, thanks to China’s Dongfeng and French government.

Peugeot plans return to IndiaApart from this, last month it was reported that Peugeot is planning to tie-up with GM India. We are not sure if any of this is going to materialize, but one thing seems to be be for certain, that Peugeot wants to re-enter India.

via Times of India