ANE CONGRESS: Folz sees more market for PSA
But USA still not in the mix
Sylviane de Saint-Seine
Automotive News Europe
PSA/Peugeot-Citroen is confident it can increase its market share in Brazil this year, as cars roll out of its Porto Real plant in the south of the country.
PHOTO: PHIL MEECH
Automotive News Europe Congress index
"We've become the smallest local producer (in Brazil) instead of being the largest importer," PSA CEO Jean-Martin Folz said Monday at the Automotive News Europe Congress in Gothenburg, Sweden.
Folz predicted that PSA's Brazilian market share would increase to 4.8 percent this year, compared with 3.2 percent in 2001 and just 0.5 percent in 1997. That forecast comes even as Brazil struggles with deep financial turmoil brought on by neighboring Argentina's economic woes.
PSA has targeted Latin America for international expansion, along with central and eastern Europe and China. In central and eastern Europe, Folz plans to maintain or slightly increase the company's market share, which stood at 10.5 percent in 2001 and at 12.4 percent at the end of May 2002.
In China, PSA has just signed a new agreement with its longtime partner Dongfeng. Six models will be produced in a joint venture at Wuhan. PSA and Dongfeng expect to sell 150,000 units by 2004.
In 2001, PSA sold 3.1 million -- 587,300 of them outside western Europe.
Folz commented on several issues Monday:
ON EXPANSION IN THE US MARKET: Folz has been seeking to dampen speculation that PSA is planning to re-enter the US market in the near future. Asked about expansion in North America, Folz made his usual quip that the company would for sure return to the US market "by the year 3000."
ON TECHNICAL INNOVATION: Folz expects 1 million PSA cars to be equipped with particle filters by 2004, compared with 270,000 by the end of April this year.
Once reserved to PSA's upper-medium cars, particle filters are now used in Peugeot's lower-medium 307. Devised to eliminate particles generated by diesel engines, PSA's innovative particle filter has been costly to produce and has so far found no outside customers.
Faurecia, the French supplier that is 71 percent owned by PSA, is working on a cheaper, second-generation particle filter.
ON COST CUTTING: Folz said he wants 85 percent of PSA's Peugeot and Citroen models to share platforms -- or a majority of components -- by 2003 or 2004. Fifty percent of PSA models shared platforms in 2001 and Folz expects that to rise to 65 percent this year.
Sharing platforms helps boost the capacity utilization rate of PSA's plants. PSA's plants ran at 114 percent of capacity in 2001, compared with 101 percent in 2000 and 76 percent in 1998.
Folz said PSA has added a third shift and weekend shifts to meet demand for its hot-selling 307.