Peugeot will return to India by 2020 in a joint venture with Indian conglomerate CK Birla Group, the PSA Group has announced.
The French car maker has signed an agreement to produce and sell vehicles and components in the country following a 23-year absence from the Indian market.
Peugeot originally announced a comeback in India in 2011, but financial struggles meant the plan was terminated.
As part of the new agreement PSA Group will be the majority stakeholder in the joint-venture with Hindustan Motors Finance Corporation Ltd, which was acquired by CK Birla Group in 2014.
The other part of the agreement will see a joint venture – with a 50% share – created between PSA Group and AVTEC Ltd (also owned by CK Birla Group) for the manufacturing and supply of powertrains.
It's expected that PSA Group will invest around £80 million in vehicle and powertrain manufacturing at a plant in the south-eastern state of Tamil Nadu, and aims to build around 10,000 vehicles a year.
The move follows PSA Group’s 'Push to Pass' growth plan, according to chariman of PSA Group, Carlos Tavares.
"Benefitting from the strong support of our Indian partner, the CK Birla Group, and a shared vision, this project is consistent with the strong execution of our 'Push to Pass' strategic plan and represents a major step in PSA Group's worldwide profitable growth in key automotive markets,” Tavares said.