Peugeot is set to make a return to the South African vehicle market after a two-year hiatus. The parent company, Groupe PSA, will relaunch Peugeot alongside Citroën, under the Peugeot Citroën South Africa (PCSA) brand, before the end of 2019. Peugeot is an indirect customer of Formex Industries as our automotive components are sold to the brand through 1st Tier suppliers.
In 2017, Peugeot sold 51% of its shares in PCSA which marked an almost complete withdrawal from the domestic market. However, the French car manufacturer is making a return after Groupe PSA wholly bought out PCSA. The new company faces an uphill battle in the South African market but managing director Xavier Gobille is confident in their abilities.
Peugeot sets ambitious targets
Gobille has set ambitious targets for the brand going forward. He is hoping that PCSA will have a 2.5% market share by 2021 (up from 0.2% in 2018). “If we, eventually, get 5% market share I would consider this a failure. This would be around 30 000 units a year,” Gobille says. He is also aiming for 2000 vehicle sales in the last quarter of 2019.
Peugeot sold 1115 vehicles in 2018, so beating these figures in just three months is going to be a challenge for PCSA. However, Gobille is known to have turned around many struggling businesses. He believes that the company can grow its local sales volumes by over twenty times.
How PCSA will recover South African sales
PCSA’s turnaround strategy includes creating an enabling organisation with a strong dealer network. Customer relationship management is a key component of this new brand recovery, which will be driven by after-sales efficiency and service. PCSA will also work towards enhancing the two vehicle brands in the local market by leveraging their strong performance in the European sector.
Peugeot will make its return to South Africa along with three other brands – Citroën, DS and Opel – all of which will be owned by PCSA. Two new models are already available to South African buyers; the Peugeot 108 and 5008 SUV, which will be the brand’s halo cars over the next year. Both of these vehicles will be sold with a five-year/100 000 kilometre warranty and service plan.
Peugeot currently has 25 official dealers across South Africa. Five new dealerships are currently being built and Gobille hopes to have 80 set up by the end of their revival campaign. These dealerships will be able to sell all four PCSA brands, not just Peugeot. In addition, Peugeot, Citroën, DS and Opel owners will be able to make service bookings through any of these dealerships.
This move will allow the four brands to work together under the umbrella of PCSA. “It makes our reach wider, and the network more cost-effective and competitive. I’m not adding costs, but I’m adding customers,” concludes Gobille.
Image credit: Dirtsc
Formex Industries is a metal forming and assembly company that supplies a variety of complex products to the local automotive industry and the export market. The company is based in the Nelson Mandela Bay metropole, South Africa’s foremost region for automotive manufacturing and export.
Formex specialises in producing components for the catalytic converter industry, as well as metal components and assemblies for the various vehicles. Formex aims to become one of the foremost suppliers for the South African automotive industry by 2035, aligning itself with the South African Automotive Masterplan (SAAM) which takes effect in 2020.
Formex is a Level 2 B-BBEE supplier with over 80% black ownership, of which more than 40% are black women. The company is owned by Deneb Investments Limited – a subsidiary of Hosken Consolidated Investments Limited (HCI) – one of South Africa’s biggest true B-BBEE companies listed on the Johannesburg Stock Exchange (JSE).
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