Peugeot could launch a new city car in the vein of the old 108 if the EU's new 'E-car' category is successful in making such models viable again.
Peugeot withdrew the 108 – closely related to the Toyota Aygo and Citroën C1 – from sale around four years ago and the larger 208 supermini has been the brand's entry model since then.
The 108's retirement brought an end to three decades of Peugeot city cars - a lineage that began with the 106 in 1991 – and came as part of a mass exodus from the 'A-segment', where increased regulation and production costs had strangled margins to the point of unviability. The related Citroën was also axed, and rivals including the Ford Ka, Vauxhall Viva and Skoda Citigo bowed out at around the same time.
But now, Peugeot CEO Alain Favey has given a strong indication that the company could return to the segment - if law makers sign off a new framework for small car regulation that helps manufacturers build them profitably.
Asked about the potential for a model smaller than the 208 in the future, Favey told Autocar: "There was a 108, there was a 107 and there was a 106 in the past. We've sold more than a million cars in the A-segment in the not so distant past. So definitely, if there is this new category that allows us to produce smaller cars at a profit, then obviously there will be a space for Peugeot in that area, as there was in the past."
Favey was referring to the mooted 'E-Car' category that the EU could introduce in a bid to incentivise car makers to return to ultra-compact, affordable models like the old 108.
Details have yet to be finalised, but the new framework would look to alleviate some of the costs of small car production by reducing the amount of legislation and mandatory technologies that must be factored in, so that more viable profit margins can be achieved from low list prices.
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