After a long period of "monogamy", French automaker PSA Peugeot Citroen finalized its second partner in China---Harbin Hafei Automobile Industry Group Co. at the end of Jun.. However the establishment of the new joint venture and the models to be produced will not be announced until Sep..
According to local regulations, an international automaker is allowed to have two joint ventures in China. Before that, DPCA---Dongfeng Peugeot Citroen Automobile was the only production base of PSA cars.
PSA signed an MoU (Memorandum of Understanding) with Hafei on the 29th of June, according to which details such as the form of cooperation, R&D mode and the marketing strategy will only be released by Oct..
Hafei’s existing Shenzen factory has been chosen as the location of the new facility, operation is expected to commence in the coming six months. The first car is expected to roll off the line and hit the market early next year.
This Sep., PAS will release its new development strategy in China for the next decade. Though PSA China's new strategy for next-decade development will not be released until this Sep., some specifics like more production and models can be predicted. The Shenzhen facility will be central to PSA's future in China.
PSA set up its first joint venture, DPCA, during the 1980s. The French automaker was among the very few international competitors which has only one joint venture in China. When the production capacity of its first joint venture reached a bottleneck, PSA was cautious in setting up a second manufacturing venture. The feasibility evaluation took over three years before PSA gave it the green light.
Based on the MoU, PSA and Hafei will jointly develop and produce the new models. In the primary stage, prototypes will be produced locally under the Citron brand. In the second stage, the products will be introduced and modified to meet the market need. Finally, new models customized to fit local taste will be added, possibly using Hafei's marques.
"DPCA will focus on sedans while the new joint venture with Hafei will focus on commercial vehicles, thus the two won't have any conflicts," according an official from PSA China.
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