PSA/Peugeot-Citroen CEO Jean-Martin Folz was a happy man at the recent Geneva auto show. Just a few days earlier he had announced 2000 sales figures up 16.9 percent to 2,817,700 vehicles - ahead of the target of 2.7 million.
Now he wants to sell 3 million in 2001. Can he do it? 'Why not,' he says. 'Across the Peugeot and Citroen ranges we have the right products - and we have diesels.'
Diesels remain one of the important issues in Europe. 'Diesel is the future for cars,' said Folz. 'Let's look at it. Diesels are greener and more energy efficient than gasoline engines. There is 15 percent improvement in consumption and emissions while the issue of harmful particulates has been addressed by our particulates filter.'
PSA's 'filtered' HDi engine is already available in Peugeot vehicles and debuts in the Citroen brand with the launch of the C5 this month.
'Once we get people to fully realize the benefits, then the demand for diesels will continue to grow. We may even have to look at the North American market,' he said.
PSA is currently working on a new family of diesel engines with Ford. This family will include 1.4- and 1.6-liter engines, a 2.0- and 2.2-liter unit, a V6 and a commercial vehicle engine, said Folz.
The PSA chief remains adamant that the company can survive alone, although other technical tie-ups are inevitable. These include a renewed range of commercial vehicles and minivans with Fiat Auto. Last week, PSA announced a joint investment with Renault in a center of excellence for vehicle aerodynamics in France (see story on page 29).
With success in western European markets exceeding expectations, Folz's plans for expansion around the world are moving more slowly. PSA is now the sixth-largest automaker in the world and the one with the greatest rate of internal growth.
PSA's worldwide market share currently stands at 5 percent. Folz's target of 3 million sales in 2001 for the two marques includes light commercial vehicles. Of that total, 1.2 million will be Citroen vehicles.
The company's platform strategy also appears to be paying dividends, with plants becoming platform-specific rather than brand-specific.
In France, the Poissy and Aulnay plants are already producing the Citroen Saxo/Peugeot 206 platform. Mulhouse and Sochaux, meanwhile, are producing the Citroen Xsara/Peugeot 306 platform. Rennes will produce a third platform. The first model off this platform is the new Citroen C5.
Vigo in Spain will continue with niche models such as the Picasso compact minivan, while other satellite plants around the world will adapt as levels of demand fluctuate.
Folz said: 'We achieved 101 percent factory utilization in 2000 with some plants working on three shifts and weekends.'
Outside western Europe, Citroen sales grew by almost a third, concentrated in three key areas: central and eastern Europe, South America and Asia Pacific. In China, Citroen took around 10 percent of the market. Growth in such diverse countries as Turkey, Argentina and Brazil saw increases of up to 159 percent.
PSA's goal has been to become less dependent on European sales. Folz has stated plans to reach 25 percent non-European sales, but PSA is slipping behind this target.
'This is because we keep increasing our European sales at such a good rate,' he said. 'We still hope to reach 20 percent [non-European sales] by the end of next year, up from 18 percent. I would like to see 800,000 sales outside Europe by 2008. We are already at 480,000.'
Key markets include central Europe, where PSA is looking for an 8 percent market share. It currently has 6 percent. Mercosur, Iran and China are other important markets for PSA.
In China, Citroen is the second-biggest selling brand with a 10 percent market share.