Peugeot, one of the oldest car brands in the world, will reenter the United States. The move will be measured. The American car market is already crowded with over 30 major brands. Peugeot’s parent, PSA Group, believes the potential reward is worth the risk.
PSA Group owns the Peugeot, Citroen, DS, Vauxhall and Opel brands. Its major markets are in Europe. PSA Group Chair Carlos Tavares said the company will enter the Russian and Indian car markets too. Peugeot may come back to the Canadian market as well. Cars for the markets likely will be made in China and Europe.
Tavares harkened back to Peugeot’s early roots in the United States. “We made the decision Peugeot will be the brand to take us back to North America. We believe bringing the brand that three times won the Indianapolis 500 is the right thing to do.” Those victories happened in 1913, 1916 and 1919, that last win a century ago. It has remained active in racing, more recently in the famous “24 Hours of Le Mans” and Dakar Rally, which is held in South America.
Peugeot entered the United States with cars available to consumers in 1958. It left in 1991. The company’s sales in Europe are substantial. It sold 962,201 cars there last year, and sales have risen consistently since 2012.
Peugeot’s challenge in the United States is that most of its models are small, get high gas mileage and are inexpensive. That may be why it plans to enter the American market on a measured basis. Almost all the major car brands in the United States have models that compete with Peugeot’s. And several major car companies are cutting their sedan presence in America almost completely. Ford will drop almost every car it sells to focus on sport utility vehicles, crossovers and pickups. Peugeot does have a line of SUVs that it markets in Europe.
PSA Group’s financial results have been strong recently. In 2018, revenue rose 19% to €74.03 billion. Operating margins rose to 7.7% in 2018 from 6.4% in 2017.