PSA to choose either Wuhan or Hangzhou to build third plant

Shanghai. October 31 (Gasgoo.com) - PSA Peugeot-Citroën Chairman Christian Streiff has said that the company expects to make a decision on a third plant in China soon, according to Reuters.

"We are in talks with Dongfeng as to the location of the third plant in China," Streiff said, but he offered not details about the location or capacity of the planned third plant in China.

However, media reports say the third plant would be located either in China's central city of Wuhan or eastern city of Hangzhou near Shanghai. The plant would be an extension of the Dongfeng Peugeot-Citroën Automotive joint venture.

The capacity of Dongfeng PSA's first plant in Wuhan will be raised to 300,000 units by 2008. And PSA's second plant in Wuhan, which will be put into operation by 2009, will have a capacity to produce 150,000 units annually. Citroen C5 will be the first model to be produced at the second plant in Wuhan.

Separately, PSA signed a MOU with China’s Hafei Auto Group on June 29 this year. Under the MOU agreement, both sides agreed to start a 50:50 joint venture automaker in Shenzhen next year, where commercial vehicles and minivans will be produced, Streiff said.