Citroen C5
European auto major Groupe PSA Wednesday formally announced entry of its Citroen brand in India with plans to launch four models in the next four years starting with its flagship SUV model C5 Aircross by the end of 2020.
The company, which plans to bring in a range of products that would be made and launched in India before introducing in other parts of the world, is looking to leverage on the fast growing SUV segment as it tries to balance volume and profit to have a sustainable business.
Groupe PSA Chairman Carlos Tavares said India is an important market for company to increase its global footprint and revenues.
"It is fair to say we are planning four cars in the pipeline (for India). It is Citroen's commitment to the market," he told reporters here while launching the Citreon brand here.
While he did not disclose details, Tavares said, "Besides the C5 Aircross SUV, there are three more products in the pipeline, which means in the next four years, there are four products coming." He said with the introduction of Citroen, the company's aim is to 'be Indian in India' and its association with the CK Birla Group will be important to become a major player in the Indian automotive market.
Elaborating on the company's product strategy for India, Citroen CEO Linda Jackson told PTI, "We are launching the C5 Aircross because we want to build image and awareness. So, it is the brand image builder and it embodies everything about the positioning with high-end features."
When asked what type of vehicles would Citreon bring to India, she said, "If you look at any market across the globe, one of the big growth segments are SUV's."
"So, without telling what it is going to be, it is fair to say that if we are going to look at real opportunity to match volume and profit to have sustainable business growth then it is going to be around that type of vehicles," she added.
Terming the Indian market as dynamic with high potential, Jackson said, "In India, we will be inspired by the Indians... we will develop highly localised cars to meet customer expectations."
The company will launch one model each year starting 2021, she added.
Tavares said the group believes India is a strong opportunity for growth and play a key role as it targets 50 per cent increase in sales outside Europe by 2021.
Groupe PSA is Europe's second-largest carmaker after Volkswagen.
When asked how the company plans to utilise the iconic Ambassador brand which it now owns, Tavares said Groupe PSA would not rush in to utilise the brand considering its place in Indian automotive history and would take a cautious approach so as not to do anything that would be "misaligned with the emotions and expectations of our Indian consumers".
"We are too young in this market to be able to have a clear-cut opinion about how to use it. So, we will keep it in our hands, and we will try to understand the market better and at the same time, look for the best opportunity to do in a way that is emotionally warm, acceptable and also aligned with the values of the Citroen brand," he added.
Jackson also said, "We are currently in the process of analysing how it (Ambassador) can be used as it is an iconic brand, we would not like to mean any disrespect to it."
Groupe PSA Executive Vice-President & Head of India-Pacific Emmanuel Delay said India provides "loads of opportunity" despite being a tough market.
PAS will start powertrain manufacturing start this year in Hosur and would also utilise the Indian facilities for exports. It will start with an initial manufacturing capacity of 1 lakh units per annum at Thiruvallur plant and later depending upon the market conditions, scale it up.
He said the company would like to have a market share of around 2 per cent over the next 4-5 years.
In 2017, PSA Groupe had announced a partnership with CK Birla Group to re-enter the Indian market and earmarked an initial investment of 100 million euros to set up a plant for vehicle and powertrain manufacturing in Tamil Nadu.
The tie-up entailed two joint venture (JV) agreements between the groups.
PSA Groupe, which sells three brands -- Peugeot, Citroen and DS -- is no stranger to India, having entered into a partnership with the erstwhile Premier family resulting in JV Peugeot PAL India. However, it pulled out from the JV in 2001.
The group had made repeated attempts to return to the Indian market. In 2009, it decided to go slow on plans to kick off operations in India due to a global economic slowdown. Later, in 2011, it announced plans to re-enter the Indian market with a mid-sized sedan, 10 years after it had exited the country. The plan, however, did not materialise.
The CK Birla Group is known for the now-discontinued iconic Ambassador car that was manufactured by group firm Hindustan Motors. It has a presence in technology and automotive, home and building, and the healthcare and education sectors.
