The mission of PSA Peugeot Citron production facilities is to manufacture, each day, vehicles that

meet both the design teams expectations and customer requirements while complying with cost
targets and delivery deadlines

In 2013, Citron further expanded its international presence and confirmed its move up the value
chain with DS, which is recognised for its premium positioning, and the Citron range, which began a
renewal in 2013 that will pick up speed in 2014.
THE GLOBALISATION PROCESS CONTINUES
In 2013, PSA Peugeot Citron stepped up deployment of its international expansion strategy with
the goal of enhancing the Groups growth in high-potential markets such as China, Latin America and
Russia, as well as in the Mediterranean Basin
BLUE HDi : A BRAND NEW TECHNOLOGY FOR REDUCING NITROGEN OXIDES (NOx)
Blue HDi, which includes a Selective Catalytic Reduction (SCR) after-treatment system integrated in
the exhaust stream before the additive-technology particulate filter (DPF), eliminates more than 90%
of tailpipe NOx emissions and further reduces CO2 emissions at the same time (by up to 4%
compared with current diesel engines). This technology complies with the future Euro 6 standard
and brings diesel emissions down to the same level as petrol engines. Introduced on the Peugeot
508 and Citron C4, Blue HDi will be extended across the entire Peugeot and Citron diesel line-up in
2014
PETROL ENGINES:
CONTINUOUS IMPROVEMENTS
Integrating the most advanced environmental technology, the high-performance, compact and
modular EB Turbo PureTech petrol engine will enable PSA Peugeot Citron to strengthen its
leadership in low-carbon-emission vehicles. This new three-cylinder engine, available in 1.2 THP 110
hp and 1.2 THP 130 hp versions, will be produced in France in early 2014 and in China for the local
market starting in 2015. It will play a critical role in driving the Groups international expansion.
WITH GENERAL MOTORS TAKES SHAPE
The Alliance agreement between PSA Peugeot Citron and General Motors, signed in February 2012,
took shape in 2013 as synergies were adjusted and projects were launched to share platforms, pool
supply chain operations and set up a joint purchasing organisation. General Motors decision to sell
its recent stake in PSA Peugeot Citron does not affect the Alliance, which is based on a balanced
division of responsibilities.
Logistical cooperation agreement with Gefco
The logistics agreement signed in 2012 between General

Motors and PSA Peugeot Citron to improve operating efficiency and reduce costs came into effect
in 2013. As part of this agreement, most of the logistics operations, in particular, of Opel/Vauxhall
and Cadillac in Europe (including Russia) will be transferred to Gefco
Tangible step
The Alliance partners have confirmed their continued cooperation in Europe to develop two vehicles
on PSA platforms, one for the B-MPV segment and the other for the C-CUV segment.
PSA Peugeot Citron and General Motors are also working together to develop a new B-segment
commercial vehicle based on the latest generation PSA platform. The first vehicles to come out of
the Alliance should be on the market as from 2016. In addition, production of the jointly developed
vehicles will be divided up more evenly. The B-MPV segment vehicles will be made at the General
Motors plant in Zaragoza, Spain, while the future C-CUV-segment models will be made at the
PSA Peugeot Citron plant in Sochaux, France. Both manufacturers models will be clearly
differentiated and fully aligned with their respective brand identities. The vehicles produced in
Zaragoza are expected to reach the market in late 2016.

http://psa.publispeak.com/sustainable-development-and-annual-report2013/com/ipedis/publispeak/client/contents/pdf/Sustainable_development_and_annual_report_20
13.pdf

SWOT ANALYSIS Dec2013

Peugeot is engaged in the design, development, manufacturing and sale of passenger cars; light
commercial vehicles; scooters and motorcycles.The group is one of the leading automotive
companies in the world holding significant market share in the industry. Leading market position
enhances the brand image and makes the group's entry into new markets easier and helps in
increasing the customer base. However, intense competition presents a significant risk to the group's
ability to enhance its revenue per vehicle and maintain its market share.

3 shared projects

The B-MPVs from both companies will be built in the GM Spain plant in Zaragoza and the future CCUVs in the French PSA Peugeot Citron plant in Sochaux.

Additionally, the partners will cooperate on new generation products in the light commercial vehicle
B-segment, which are based on a PSA Peugeot Citron new generation platform.

A balanced division of roles and responsibilities will allow each partner to derive the greatest benefit
from this collaboration.

The first jointly developed vehicles will be launched in 2016.

The alliance between PSA and GM is based on a balanced approach, GM Europe boss Karl-Thomas Neumann said in a
statement.
The vehicles of both manufacturers will be highly differentiated and fully consistent with their respective brand
characteristics.

.The two will also share manufacturing-- with each firm producing one vehicle

Another significant area of the alliance is shared purchasing, which should help both firms reduce costs.

for the other.

The two firms have canceled plans to develop a new family of three-cylinder engines together.

They have also canceled plans to develop a new subcompact platform together, and GM said it sold its 7 percent
stake in PSA for $250 million.

Why Form This Alliance?

The goal is to save money by splitting development costs, purchasing parts from suppliers together, and
perhaps consolidating European production.

GMs European arm, Opel, has been a money-loser for years, while its sales have dropped. Peugeot is
hanging on as the second-largest automaker in Europe, but sales are weak and it owes a fortune in debt.
Peugeot came close to a similar deal with Mitsubishi Motors two years ago.

The hope is that GM and Peugeot working together will be better able to compete with Volkswagen, Kia, and
Hyundaiall of which are making big investments in Europe.

Dongfeng Motor to Buy Stake in Peugeot for 800 Million Euros

Dongfeng will buy 524 million euros of Peugeot shares at 7.50 euros apiece and the rest through a
rights issue, with the French government expected to do the same, the Wuhan, China-based
company said in an exchange filing today. The deal will give Dongfeng and the French government
holdings of 14 percent apiece, while the Peugeot familys stake will be diluted to 14 percent from
the current 25.5 percent, a person familiar with the matter said before the announcement.

The move could ultimately bring lower prices for fleet operators, says Fleet Logistics.
Each company will continue to market and sell its vehicles independently and on a competitive basis.
GM will pay about 320 million for a 7% stake in PSA, making it the second-largest shareholder of the
Paris-based company after the Peugeot family.
GM and PSA Peugeot-Citron will share selected platforms, modules and components on a worldwide
basis, in order to achieve cost savings, gain efficiencies, leverage volumes and advanced technologies,
and reduce emissions.
Permits both companies to execute Europe-specific programs with scale and in a cost effective
manner.

The alliance enhances but does not replace either companys on-going independent efforts to return their
European operations to sustainable profitability.

total synergies expected from the alliance are estimated at approximately 1.25 billion annually
within about five years

OBJ of alliance

Alliance allows both PSA and GM to save around 1 billion in a fully implemented state in around five
to seven years time.
Allows GM to ultimately produce Opel cars in PSA factories especially since PSA is also suffering
from underutilization of factories.
Help the two manufacturers pass more discounts on to international fleets.

GM is strong all around the world, but not in Europe. (less than three years after it was rescued from
bankruptcy by a US government cash injection)
Peugeot, in contrast, is weak all around the world, though in Europe it has done much to cut costs, improve
manufacturing processes and diversify with new products. (cut back its research and development activities,
reduce its marketing budgets and scale back its international ambitions after enduring a 500m euros)
A problem facing both companies is the way the European markets are expected to be under pressure for
some time.
Problems:

They both lose money in Europe. The issues they face may not be fixed by teaming up.
Cant restructure independently. We see no reason why putting PSA and Opel together would speed
up the process of plant closures, as both have excess capacity.
Failed to end losses in Europe after extensive cost-cutting programs.
Political interference and strong unions have hampered both companies from shutting factories and
laying off workers to rein in costs.

Cutting investment

Reduce investments and marketing spending as part of a goal of saving 1 billion euros, an
increase from a previous 800 million euros.
aims to sell 1.5 billion euros in assets to reduce debt, which widened to 3.4 billion euros in 2011.

The lack of distinctive models has eroded market share for the two groups.
PSA's share in Western Europe slumped to 12.6 percent in 2011 from 13.7 percent last year (2011) after its
sales in the region fell 8.8 percent.
Opel and Vauxhall's share slipped to 7.3 percent from 7.4 percent. The GM brands controlled 12.6 percent of
the market in 1993.