PSA Peugeot Citroen is betting on its newly launched 301 sedan to gain market share outside its traditional western European markets, which have been deeply affected by the crisis.
The new 301 is a stripped-down sedan aimed at emerging markets, where demand for practical sedans is still strong. The Peugeot 301 went on sale on November 1 in Turkey and will be also launched in Eastern Europe, Africa and South America in the coming months. Peugeot’s aim is to gain a foothold in places with more growth potential than saturated western Europe.
“We want to attack these new markets. We have a vehicle of conquest, and have great faith and hope,” said David Rio, director of the Peugeot brand’s international operations. PSA has been burning its cash reserves over the past year at a rate of 200 million euros a month because of its reliance on Europe, where demand will see its biggest drop in almost 20 years.
In the first nine months of the year, 64 percent of PSA’s sales were in Europe, while Volkswagen sold 42 percent of its cars on the continent. Since Peugeot doesn’t have important operations in countries like China and Brazil to offset losses in Europe, it had to cut prices to keep selling cars.
The 301, a stretched version of Peugeot’s 208 hatchback, is expected to reach sales of 150,000 annually by 2014, equivalent to about 4 percent of Peugeot’s deliveries last year.