PSA China to triple output by 2010

Models to launch

During the first half of this year, PSA sold around 103,000 units of its vehicles in China, gaining a slim two percent compared with last year. In contrast, the whole market increased by an average of 26.3 percent. PSA, which lacks in flagship models and is limited by low output, is currently lagging behind other competitors.

There have been speculations that PSA China will introduce seven new models over the next two years. Peugeot 207, 407, 807, 308 and Citroen C5, C4, C3 are among the models to be localized. 

Peugeot 207, which cost nearly 1 billion Euros to develop and produce, was launched last year and was a huge success. The model will be slightly more expensive than the existing 206, if produced in China.

Peugeot 807, a model most likely to be produced by PSA and Hafei, has the potential to go head-to-head with Buick GL8 and Honda Odyssey.

Citron C3, a small economy car, will be PSA's first choice from a cost perspective. This is a model similar to Citron C2, which has been produced domestically, is currently under consideration due to Citron C2’s encouraging sales since launch.

Capacity to raise

According to the Chinese regulations, an international automaker is allowed to have two joint ventures in China. Before Hafei, DPCA---Dongfeng Peugeot Citroen Automobile was the only production base for PSA.

Now, DPCA is expanding its existing factory to achieve an annual production of 400,000 units. DPCA's second factory, which will start operation during mid 2009, could churn out 200,000 units per year. DPCA has already employed all the three platforms from PSA.

PSA and its second Chinese partner---Harbin Hafei Automobile Industry Group Co. signed a MoU (Memorandum of Understanding) on the 29th of June. According to the deal, The PSA models will be produced in Hafei’s existing facility in Shenzhen, the special economic zone.