Peugeot Citroen duo, who were planning to set up a facility at Sanand, Gujarat have brought the same to a halt. The French duo has surrendered its right to a 600 acre piece of land at Sanand, for which it had plans of investing Rs.4000 crore for a manufacturing facility. Earlier the company had shut down their Mumbai office.
Though surprising, it was an inevitable move for Peugeot Citroen as they are focusing more on their home market which is battling its worst ever financial crisis. The company wants to focus its resources on its home market as of now, and is not willing to go ahead with its Indian operations.
Putting its Indian operations on hold for an indefinite time, the company has surrendered the land allotted to it by the Gujarat government. The company was supposed to pay periodic installments to the state government but it failed to do so. Last year, the company had signed a State Support Agreement (SSA) with Gujarat govt. for setting up the plant with 3.4 lakh cars by year 2016.
“All their plans for India are on hold as of now,” said M Sahu, MD of Gujarat Industrial Development Corporation (GIDC) – the agency for allotting land for industries in Gujarat.
This was the second innings for Peugeot in India and it planned to assemble Peugeot 508 sedan in India during 2014, while the newly introduced Peugeot 208 hatchback / small car was expected to come at a later point in time. If you remember, we brought you some exclusive spy shots of the 508 sedan and 207 hatchback a few months back.
Last year the company signed up for a joint venture with General Motors in Europe, for production and sourcing convenience. In India though, General Motors has refused to lend its production facilities to Peugeot, leaving the French major no other option but to put its Indian plans on a hold.
We do hope that the slowdown in the European market subsides and Peugeot gets a chance to come back to one of the fastest growing markets. We will keep you updates on the new updates, stay tuned to Car Blog India.