The PSA Group has been openly exploring an entry into the North American market for years – and it seems the time is now. As part of the group’s bold ‘Push to Path’ strategic plan, chairman Carlos Tavares confirmed the firm’s various brands would be expanding into new markets: Peugeot into North America, Citroën to India and Opel to Russia.
The boldest move is that North American one. Peugeot hasn’t been present in the USA since 1991, when it withdrew after 33 years due to dwindling sales. But given PSA and Peugeot’s desire for growth, the market – one of the biggest in the world – represents a huge opportunity.
Clearly, it makes sense for PSA to focus its North American efforts on a single brand, and Peugeot has more heritage there than any other PSA marque. Tavares said: “We believe bringing the brand that three times won the Indianapolis 500 is the right thing to do.”
Three Indy 500 wins is, indeed, a fine achievement, although it’s worth noting the last of those came when Howdy Wilcox triumphed in 1919, the first time the event ran following the First World War. Not exactly a result likely to resonate with current US car buyers.
Resonating with US buyers will be Peugeot’s biggest challenge, especially given the market there is dominated by large SUVs and large pick-ups such as the Ford F-150. It’s a market rapidly moving away from traditional cars, with the likes of Ford deciding to can all of its saloon models. There’s a focus on rugged, no-nonsense, bold vehicles that contrasts sharply with Peugeot’s design-led French flair.
But that contrast could present an opportunity, giving Peugeot the chance to stand out in the market – and it seems the firm is planning to do that. While Tavares did not give specifics on the firm’s North American plans, he said Peugeot's North America business would operate in “a highly unconventional way, not the traditional way”, with an emphasis on “frugality”.
Tavares did say that, initially, the cars sold in North America would be imported from China and Europe, which suggests it will be models from its existing range. Peugeot has enjoyed growth in Europe through the success of its SUVs, several of which could appeal in the US. The seven-seat 5008, for example, would be a good fit size-wise – and could offer an alternative to the American, Japanese and German machines that dominate the segment.
Tavares hinted that the ‘frugal’ and ‘creative’ approach would also apply to its distribution model, which suggests the car maker isn’t aiming to recruit a large dealer network – a process that would require massive investments of time and resources. That would also suggest Peugeot will put a focus on online sales – already a development focus for the wider PSA Group – and alternative sales routes such as showrooms. Tesla has already shown it is possible to build a customer base in North America through such channels.
In fact, it’s possible that Peugeot could take further cues from Tesla, by focusing on electrified cars. The firm will offer either a hybrid or full electric version of every model going forward, and such EVs in the USA could help it tap into a growing market segment. The new Peugeot 208 might be on the small side to hold mass appeal for the USA, but the forthcoming electric version could hold Tesla-style appeal for city-based American customers seeking an electric car. That's a chunky market Peugeot could make real inroads into.