3 Apr 2014

Peugeot's woes

I have always has a soft spot for Peugeot since being responsible for their sales and marketing in Australia for nearly 10 years back in the 1980s and I still own a Peugeot today.We sold some great cars particularly the 505 and the 205 GTI.So I was sad to see that the Peugeot family has lost control of the company after years of heavy losses and have just sold 14% of the company to Chinese interests-the Dong Feng Motor Group -and 14% to the French Government.
Peugeots woes have been building for many years-a combination of many issues but particularly gross overcapacity and low productivity and a very heavily reliance on the European market which has been very depressed for the last few years.
Peugeot have not sold cars in the critical US market since the early 1990s and no internationally succesful automotive brand has prospered without a strong US market presence.Peugeot's problem was that they really did not have products which suited the US market and the brands strength in diesel cars was of no interest at all to Americans.
Peugeots halcyon days were 1950-1985 when they had big sales volumes in Africa,the Middle East and South America with initially the 203 and then the 504 and 505.They were ,of course, very strong in the French "colonial" markets.The cars were well engineered rugged,reliable and well suited to rough market conditions.Many were shipped to the markets in SKD(semi knocked down)or CKD (completely knocked down) kit form and locally assembled to meet local duty and quota rules.In Australia the local importer,JRA ,assembled the 505 from CKD kits because of import restrictions on fully built up cars at the time.Peugeot lost these markets because they did not have a successor to the 505 and because the Japanese and later Korean brands came into the markets.
The photo above taken by me in 1984 at the end of the 505 production line in Sochaux,France shows some of the last US market cars being finished.

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