Peugeot-Citroen back to square one; Undecided on location for Indian manufacturing plant!

Peugeot 207 Hatchback

More than a month ago, word emerged about French automaker PSA Peugeot Citroen finalizing a site in Sriperumbudur, Tamil Nadu. Back then, a delegation of Peugeot-Citroen officials even met the Chief Minister of Tamil Nadu, Ms J. Jayalalitha to work out the details about the project. Peugeot-Citroen requested for a package of incentives and the Chief Minister of Tamil Nadu assured the French delegation of its support. Now, we’re hearing a dramatic turnaround that Peugeot-Citroen hasn’t yet decided on where it will set shop in India, for its Indian operations.

The original contenders for the Peugoet Citroen manufacturing facility, Gujarat, Tamil Nadu and Andhra Pradesh are said to be in a locked battle yet again as the French automaker now seems to be playing the waiting game. According to Mr Philippe Varin, Chairman of the Peugeot-Citroen Managing Board, the French automaker will announce a decision on its Indian manufacturing plant’s location only by the end of December. This bit of news could come as a major disappointment to Tamil Nadu even as Gujarat and Andhra Pradesh get another shot at wooing Peugeot.

Peugeot 508 Sedan

With India’s most industrialized state, Gujarat, receiving a slew of investments in the automotive sector due to its good infrastructure and access to port facilities, Tamil Nadu will find wooing back Peugeot very tough. Hence, it would be quite interesting to see how this battle between Indian states will pan out in the coming few months. Andhra Pradesh for one, is the dark horse in the race as it was the very first location that emerged as a front runner for the Peugeot plant, which since then seems to have fallen out of favor due to Telangana statehood tensions.

The Peugeot-Citroen plant in India will employ a 5,000 Indians directly and will provide an indirect employment to 15,000 more people. A total investment of INR 4,000 Crores will be made by Peugeot-Citroen to set up its Indian manufacturing plant which will have an installed capacity to produce 3 Lakh cars per annum. So, a lot of money is at stake which is perhaps why Peugeot is taking time to arrive at a decision. The first cars to be produced in India are said to be the Peugoet 508 Sedan and the Peugeot 207 Hatchback, which have already been spotted by Team ICB at Pune last week.

Via TheHinduBusinessLine

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