PSA/Peugeot-Citroen plans to invest 90 million euros to add production of a new Peugeot-based compact at its underutilized plant in Rennes-la-Jannais, France, the carmaker said in a statement.
Production of the as-yet-unnamed vehicle will begin in mid-2016 at the factory where PSA currently makes the Citroen C5 and Peugeot 508 mid-sized sedans and wagons. The new vehicle will replace the current Peugeot 5008 compact minivan, which is produced at PSA's factory in Sochaux, France.
Sales of the new compact will begin in late 2016 in Europe and other global markets. The automaker expects to build 70,000 units a year of the new model starting in 2017, lifting the plant's total output to more than 100,000 vehicles a year, the automaker said.
Separately, a PSA spokeswoman said 2012 output at Rennes was 130,000 vehicles. Until 2009, the plant's annual production capacity was 350,000, the spokeswoman said, but since then the plant has been re-sized and now has a yearly maximum output of 180,000 to 200,000 vehicles.
Within the next three years PSA aims to produce 100,000 to 150,000 units a year at the plant, she said.
At a volume of 150,000 units a year the factory would be producing at about 80 percent to 75 percent of capacity. That's the level experts say is needed for a plant to break even. PSA reported a first-half operating loss in its automotive unit of 510 million euros and closed its Aulnay factory near Paris on Oct. 25.
The new model will be based on PSA's Efficient Modular Platform 2 (EMP2), which currently underpins the second-generation Peugeot 308 compact hatchback and new Citroen C4 Picasso minivan.