Peugeot to Use GM’s Plant in Halol, India image

Peugeot and its new partner GM, plan to invest 4500 crore in India to set up a plant in Gujarat and Peugeot also unveiled the 508 sedan at the 2012 Auto Expo.

Due to the slowing economy in France Peugeot closed in January its office in Mumbai – India. In February 2012 Peugeot announced its alliance with the GM, and the fact that the two companies will share platforms for small car, mid-size cars, MPVs, crossovers vehicles, low emission engines and also facilities to achieve economies of scale. This partnership will help GM with its operations in Europe and Peugeot with to start operations in India, by using GM’s facility at Halol Gujarat.

“The GM and PSA Peugeot Citroen alliance is an important partnership for GM that will have a positive effect on our company worldwide, particularly in Europe. We expect it to have long-term benefits globally, however it’s too soon to say how it will impact India and the Asia Pacific region,” said P Balendran, VP, GM India.

In February last year Peugeot was re-entering India, after over a decade, but a grim financial situation precipitated by falling sales in its home market has compelled Peugeot to review its India plans. Industry analysts, however, don’t see too much strategic sense in GM India making products for Peugeot as the two carmakers would end up competing head-on.