Analysis: Sales of PSAs made in China from 2004 onwards

Gasgoo.com (Shanghai) - Changan PSA, Peugeot's third attempt at a joint venture in China, was officially established in Shenzhen last week. PSA hopes that the new JV will do what its first Chinese company, Guangzhou PSA, which went under in 1997, could not. PSA's other JV, Dongfeng PSA, while still managing to do well, is not in the same league as similar JVs with VW, GM, Nissan and Toyota. With the addition of Changan PSA, the French manufacturer hopes to further increase its presence in the country.

200,000 Chinese made Peugeots and Citroëns were sold in 2006, a 43.4 percent increase from the previous year. However, in 2007, PSA sales only increased 2.9 percent. They fell 14.1 percent the next year. These two years saw decreasing interest in the manufacturer's models. The Chinese debut of the 207 sedan, 307 hatchback and C4 sedan did little to change that. Aside from the 75.5 percent rise in Elysée sales, sales for all other models decreased significantly, with five models, the Fukang, Xsara Picasso, C-Triomphe, C2 and 206, seeing sales fall around 50 percent.

2008 saw Dongfeng PSA make an important announcement regarding its market strategy for 2010. The JV also moved a part of its operation to Shanghai. 307 hatchback sales increased 28.2 percent in 2009, while sales of the C4 hatchback increased sevenfold to 71,800 units. The two cars, along with the 207 sedan, performed well in the small car segment, outpacing their competitors. 

Under the banner of Créative Technologie, Dongfeng Peugeot revised its dealership network in 2009, aiming its sights firmly on the mid- and high-class market. The effort the JV put into promoting its sales is why the C4 and the later released C5 managed to pull in strong sales. Ultimately, sales of Chinese-made PSA vehicles totaled 270,000 units, an increase of 51.6 percent. Sales grew another 38.4 percent the following year. In the first months of 2011, Dongfeng Peugeot sold 325,400 domestically manufactured vehicles, with a growth rate 1.7 percent higher than the industry average.

From a global perspective, sales of Peugeot branded vehicles have always been higher than those of Citroën's. However, the opposite is true for China, where Citroën has been the leading brand. This is mainly due to PSA's favoring of Citroën vehicles for China after the failure of the Guangzhou PSA JV. Prior to 2006, there was only one domestically made Peugeot, the 307 sedan, in production. However, with the introduction of new models, the ratio of Peugeots to Citroëns has increased from 12.7 percent in 2004 to 42.6 percent this year.

PSA's key markets in the country are still compacts and subcompacts, with a moderate presence in the mid-class market via the C5 and 508. The Citroën Fukang, its first domestically made vehicle, led the manufacturer's sales charts until 2006, when it was bested by the 307 sedan, which has been its top-selling model to date. It is followed by the Elysée, C-Triomphe, 206 and the Fukang.