PSA/Peugeot-Citroen drops plan to develop a low-cost car for emerging markets

Article by Christian Andrei, on March 25, 2012

PSA/Peugeot-Citroen’s plan to develop a low-cost car for emerging markets has been indefinitely suspended. This car was supposed to be built at PSA's plant in Madrid, Spain. The automaker is presently in talks to expand its alliance with General Motors Co. in order to cover more vehicle categories and technologies.

A project to develop a dual-clutch transmission was also delayed by seven months. This was expected to be used on Peugeot and Citroen cars in 2013 as part of its expansion of fuel-saving technologies. PSA said that it will explore more cost-effective pathways specifically through the GM alliance to provide the group with this type of gearbox.

PSA said that among the projects that will be shared with GM are the development of larger vehicles, dual-clutch transmissions and a compact car for growing markets such as those in Latin America. These projects would be added to the pooled development and production of subcompacts and mid-sized cars that were unveiled last month.

The Peugeot brand had a plan to launch a low-cost compact notchback sedan in 2013 that was codenamed M3 to rival Renault's Logan and aimed at developing markets in eastern Europe, China, North Africa and Latin America. This car is supposed to be more upscale than the Logan, but is mechanically simpler and much easier to maintain than comparable PSA models sold in Europe. PSA may revive the Talbot brand name for this car.

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