Changan-PSA JV deal to sign in July, to make MPV

Shanghai, June 30 (Gasgoo.com) The Changan-PSA venture finally gets some results. According to people familiar with the matter, executives of Changan Auto will fly soon to France to sign the final cooperation agreement with PSA Peugeot Citroen in July, and one of China's state leaders will also attend the signing ceremony, media reported today.

Early last month, Changan Auto entered into a preliminary cooperation agreement with PSA on establishment of a 50/50 joint venture based in Shenzhen, China. Under the agreement, the joint venture will produce small cars and commercial vehicles under the Peugeot and Citroen brand names.

It is reported that PSA's previous potential partner Hafei Auto, a mini-van maker now acquired by Changan, has built a plant in Shenzhen.

However, recent sources said that the first model to be built at the Shenzhen base will most likely be an MPV model imported from PSA. While PSA China and Changan Auto refused to comment on the report.

At present, PSA is designing two new models to meet the needs of the Chinese auto market and other emerging markets, with which the French automaker aims to break its dependence on the mature auto market gradually.

PSA aims to increase its China sales by 30% this year and to more than double its current 3.6% market share in China, now the world's biggest auto market, to 8% by 2020, with the sales to reach 2 million vehicles.