Peugeot to sign R7,000-cr MoU with Tamil Nadu govt
Mahindra & Mahindra secures in-principle approval for R4,000-crore project
European automobile major PSA Peugeot is expected to sign an MoU with the Tamil Nadu government to set up an R&D centre and a manufacturing unit in the state. The company will invest around ~7,000 crore. Also, a ~4,000-crore Mahindra & Mahindra project has received in-principle approval.
T E NARASIMHAN writes
European automobile major PSA Peugeot is expected to sign a memorandum of understanding with the Tamil Nadu government that will see investment worth ~7,000-crore flow into a car manufacturing unit in the state. The state had recently lost a big investment from Kia, a part of Hyundai Motor Company. Kia decided to invest $1.1 billion in Andhra Pradesh early this year in a car manufacturing unit even as Hyundai has all its manufacturing operations in Tamil Nadu.
Speaking at a panel discussion on industrial development in Tamil Nadu at the 107th annual general meeting of the Southern India Chamber of Commerce and Industry (SICCI), Shilpa Prabhakar Satish, executive vice-chairperson, Tamil Nadu Guidance Bureau, said the state government would sign an MoU with an European automobile major that would set up a research and development centre and manufacturing unit in Tamil Nadu.
While she declined to reveal the name of the company, another official said it was the PSA Group, the French automobile maker. The official said the investment by the company would be around ~7,000 crore.
An email sent to the group’s global communication team did not get any response. Early this year, the French auto major acquired the iconic Ambassador brand. The group has an agreement with the CK Birla Group to invest around ~700 crore in Tamil Nadu to manufacture and sell cars.
Reports said PSA Peugeot Citroen, which renamed itself Groupe PSA in April last year, had pitched to launch 17 vehicles by 2021. Peugeot is returning to India with a compact sports utility vehicle, Peugeot 3008, the second generation of which is also to be launched in China, the only other market outside Europe.
The company that owns the Peugeot, Citroen and DS brands exited India in the late 1990s, ending a brief joint venture with Premier Automobiles that launched just one car. The second attempt in 2011 was aborted after the company bought land in Gujarat for a factory as Europe’s debt problems turned the continent’s companies cautious.
A Mahindra & Mahindra project had been approved in principle and work for a test track would commence soon, Satish said. M&M’s investment will be ~4,000 crore in two stages and spread over seven years. In the first phase, the company will set up the test track. In the second phase, it will set up an automotive plant.
Tamil Nadu, one of the major automobile hubs in the country, has been losing its eminence due to political uncertainties and ease of doing business.