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Peugeot plans India re-entry with Chinese partner Dongfeng

Peugeot 309 India

This is not the first time French brand Peugeot is trying to establish itself in India.

India has always been in the radar of Peugeot. They were among the first foreign car manufacturers to enter India in September 1995, after Indian government opened up investment from MNCs. After several unsuccessful attempts, they have still not managed to find a footing in India. Below is a brief description of their journey in India till date.

Peugeot 309 India

In 1995, France’s largest car maker, Peugeot tied up with one of the oldest car manufacturers in India Premier Automobiles Limited (PAL was setup in 1941). The first product they launched, was the outdated version of Peugeot 309 (above image). But to the surprise of many, the product clicked (in spite many buyers not aware of the brand, nor knowing how to pronounce Peugeot). Pal-Peugeot received over 1 lakh bookings for the 309 from all over India.

Sadly, of the 1 lakh bookings, only 10,000 cars were delivered by 1996, while remaining 90,000 bookings were cancelled. Due to internal issues between PAL and Peugeot, the French company pulled out of the JV in 1997. The PAL-Peugeot JV is yet to clear the dues of about 40,000 customers, who had paid Rs 25,000 up-front to book the 309 sedan. Most are still fighting case in consumer forum.

Then in 2001, Peugeot started talks with Telco (Tata Motors) and Hero MotoCorp (then Hero Honda), to enter the car and motorcycle segment in India. Both never materialized.

Between 2001 and 2010, the company conducted multiple studies to enter India, but none ever materialized. Then in 2011, Peugeot went solo and announced re-entry into India. They signed agreement with Gujarat government, and also celebrated the ground breaking ceremony at the plant site in Sanand. The company backed out from this later in 2013, due to global economic downturn, and their worsening condition in Europe.

Peugeot plans return to India

Peugeot officials in India at their new plant site in Sanand in 2011.

Now, in 2015, the French company has again hired consultants who are researching different options for Peugeot’s re-entry into India. One of the avenues of their re-entry could be along with their Chinese partner Dongfeng. Apart from this, they are also open to enter as a solo brand, or use their connection with Mahindra.

Peugeot’s current Chairman, Carlos Tavares, a former COO at Renault-Nissan, is believed to be the motivation behind Peugeot’s re-entry into India this time around. Already on good terms with top level officials in Mahindra, Mr Tavares is already familiar with India as he was part of the Mahindra-Renault JV. It is believed that his association with Mahindra played a major role in Mahindra buying a controlling stake in Peugeot’s two wheeler business.

India being projected as one of the fastest growing auto markets by 2020, person close to the latest development reveals that Peugeot has plans to bring their entire business to India. They plan to launch their entire range of two wheelers by 2017, and once established as a brand, will bring their cars into India by 2020.

The company is currently figuring out which of the many possibilities will be in their best interest for an entry into India. Solo, with Mahindra, with GM India or with Dongfeng.


About the author

Sagar Patel

Sagar Patel

A first drive in a manual rickety old van was enough to pave the road forward for Sagar Patel. When not driving or riding, his dexterity shifts gear to voice passion through words via reviews, and news, all the while, closely monitoring updates from the auto industry.

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  • Omg! After so many studies and trials if Peugeot still couldn’t manage to set feet in india, then the problem is with the company’s will not with the indian market. I love their car designs. This is one Brand which can pull me off from my love for Fiat’s designs. I hope Mahindra buys the damn Company itself and just bring it here like their two wheelers. 😀 Shut up and take my money! :p

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