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Push to Pass: Bring Us a Peugeot

We now know that the Peugeot brand is PSA’s choice for leading the company back to North America. Moreover, Peugeot’s return is part of a wider Push to Pass” plan, which was outlined this week.

The global plan includes bringing Citroën to India and Opel to Russia, while enhancing DS’s international footprint. The company is seeking to increase its non-European business by 50 percent by 2021, an ambitious undertaking that won’t include U.S. and Canadian sales. Indeed, Peugeot’s North American return won’t happen before 2026, thus the company’s initial sales thrust will depend on other markets.

Don’t expect PSA to commit to building a U.S. manufacturing plant, at least not initially. The company plans to import cars from China and Europe to meet North American capacity (including Canada), according to Automotive News. PSA CEO Carlos Tavares said the North American launch will be done in a “frugal, conservative and profitable way.”

PSA’s U.S. operation already includes this Free2Move app.

There’s an App for That

PSA’s North American headquarters is based in Atlanta. Already, the company has its Free2Move app, which tracks all the shared cars, scooters, bikes, and rides in a city. The app consolidates various car- and transportation-sharing businesses to one app, making it easier for users to find what they want. At present, the app tracks Car2Go services in Portland and Seattle and adds cycling service to Washington, DC.

PSA plans to launch a whopping 116 vehicles by 2021, including concepts. The automaker wants to reduce the average age of its product range to just 3.5 years. That’s below the industry average and could give this automaker an edge in a market where consumers want the latest models.

French, But Not Renault

Peugeot’s pending return ensures a French automaker is once again represented in the U.S. market. The company’s chief rival, Renault, doesn’t have a presence either, as it exited the market a few years after selling its AMC subsidiary (including Jeep) to Chrysler in 1987. Renault’s alliance partner, Nissan, however, is well-represented in the Western Hemisphere, including in the U.S. and Canada.

PSA’s premium DS brand won’t be headed to North America. At least not yet.

The Peugeot 2008 SUV might be one of the first models we see from the French automaker. It is a compact model with a 2019 starting price of about $23,500. Its current competitors include the Nissan Rogue and Chevy Equinox. In the midsize utility vehicle segment is the Peugeot 5008 SUV, which costs around $35,000. Like models include the Hyundai Santa Fe XL and the Honda Pilot.

Of course, the new vehicle market may look far different than it is today, with a host of electric and autonomous vehicles dominating the segment. Peugeot also has a fleet of cars in its arsenal, including hatchbacks and sedans. The automaker also has a line of vans, ranging in size from compact to full-size. Whatever Peugeot supplies, it will give North American consumers yet another choice in a crowded sphere.

Photos courtesy of the PSA Groupe.

French automaker Renault may have the solution to FCA’s product needs.

If you want to buy a French-built model in the US, you probably know that Renault, Peugeot and Citroen have no presence in the market. Instead, you’ll only be able to consider the Toyota Yaris, the lone model currently built in France and exported to the US.

2015 Chrysler 200. — The current Chrysler 200 may be replaced by a competitor’s model.

Exit…Stage Right

Both Renault and Peugeot-Citroen once had a presence in the US. Indeed, Renault had controlling interest in American Motors for several years, but exited the market in 1989, two years after selling those assets to the Chrysler Corporation. In 1991, Peugeot made its own exit from the US market, ending Citroen sales too. Some twenty-five years later, few Americans under 40 can recall cars built by French manufacturers and sold in the United States.

Neither manufacturer is poised to return to the US, a market that is immensely profitable, but is also brutally competitive. Beyond domestic manufacturers such as Packard, Checker and Studebaker, a host of foreign makes have thrown in the towel too, including Isuzu, Yugo, Daihatsu, and Suzuki.

However, one of the two French manufacturers could make a return, especially if partnered with a company already present in the US. Renault’s logical partner is Nissan, as both companies own a slice of each other and are jointly led by Carlos Ghosn, the Brazilian-born CEO for the two automakers. Its a successful alliance that has produced numerous cars for the two companies since the confederacy was forged in the late 1990s.

On the other hand, Peugeot-Citroen is not so lucky. A brief partnership forged with GM in 2012 was ended less than two years later as Peugeot sought assistance from Dongfeng, a Chinese manufacturer to support its operation. Of the two French companies, Peugeot’s financial picture is the weakest.

Renault to the Rescue?

Turning back to Renault, this automaker could very well find its way back across the Atlantic, especially if Fiat Chrysler works out an agreement for the French automaker to supply it with vehicles. Indeed, FCA CEO Sergio Marchionne announced last week that his company would no longer build its compact Dodge Dart and midsize Chrysler 200 sedans, choosing instead to devote plant capacity to build more Jeeps and Ram pickup trucks. That move means FCA should become more profitable as well as more attractive to a potential suitor.

At the same time, Marchionne said it would turn to its competitors to supply these models, but the likelihood that a Ford, Toyota or a Hyundai would dilute their own model lines to accommodate FCA seems very unlikely.

Renault may be the most logical supplier for FCA as it has two models — the midsize Latitude and the compact Mégane — that might possibly be rebadged and sold in the US. Both models are underpinned by platforms shared with current Nissan products (Altima and Sentra), but otherwise the cars are all Renault.

The downside in choosing the Mégane is that it isn’t a sedan — Renault builds hatchback, coupe and wagon variants, but no four-door sedan. That said, the hatchback might be a fit for a market that is finally accepting this body style again. Currently, Renault builds the Mégane at four plants scattered across Europe and might be in a position to supply the next generation Dodge Dart.

The second model is the Renault Latitude and this one is already sold in Mexico, where it is known as the Renault Safrane. Interestingly, the Renault Latitude/Safrane is built in Korea by Renault Samsung Motors, a minor car manufacturer operating in a market dominated by Hyundai and Kia.

Busan Plant Capacity

Although the Korean company has built more than 2.4 million cars since its 2000 introduction, its Busan manufacturing plant has the capacity to build 300,000 vehicles annually. Supplying the Latitude as the Chrysler 200 in the US and Canada would keep the Busan factory humming and give Chrysler a much-needed product.

Will Renault respond if Marchionne comes calling? There is a good chance that they would. In 2013, Mitsubishi sought a similar tie up with Renault to supply it with a midsize sedan for the US market, but that deal collapsed. In any case, Mitsubishi is barely hanging on in a market where demand for Renault-supplied vehicles would be much smaller than that of a network composed of Dodge and Chrysler dealers.

At the same time, any Fiat Chrysler and Renault relationship could push out further, perhaps including Nissan and forming at least one kind of a business relationship Marchionne desires.

These are interesting times in the auto industry. Then again, the industry is always fascinating.

CITROEN

Peugeot Prepares for its U.S. Return