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Hanover CV Show
Date: Tuesday, November 11, 2008
Peugeot
Jean-Philippe Collin, director general
What’s going to happen to the van market across Europe in 2009 in the wake of the credit crunch?
It’s going to be tough. I think that on average the market will face somewhere between a mid single-digit and a low double-digit percentage decline. We’re forecasting the worst, but hoping for the best. So far as the UK van market is concerned we think it may touch bottom at the end of this year/start of next year. After that we’re hoping it will stabilise.
The new Bipper van is assembled in Turkey, which has the advantage of low labour costs. Would you like to see Turkish facilities, or perhaps factories in the low-cost countries of eastern Europe, used to assemble other models? I appreciate that, like Bipper, Expert and Boxer are produced in conjunction with Fiat and your sister company Citroën; Citroën and Peugeot operate under the PSA banner.
As it happens our plant at Vigo in Spain, which produces Partner and Citroën’s Berlingo, is one of the most competitive plants in our group, and indeed one of the most competitive plants you’ll find anywhere. Remember that wages are only part of the equation. You’ve also got to think about productivity, quality, the supplier base around the factory, the cost of transporting vehicles from one country to another and whether or not the plant concerned is in the euro zone. You’ve got to take wage inflation in Turkey and eastern Europe into account too. There’s also the point that raw materials usually cost much the same wherever you are, but can sometimes be more expensive in low-wage countries. Because of all those factors we intend to keep a solid light commercial production base in Western Europe.
What impact has the increased price of raw materials had on you and are you passing the additional cost on to your customers?
To a degree we’ve been able to offset the impact by productivity gains and by designing our vans so that they use less material. We’ve had to pass on a little bit of the increase, but at the same time we’ve reduced the total cost of ownership for the buyer in order to compensate.
How are you setting about making your light commercials more environmentally friendly?
We have literally hundreds of engineers working on making our diesel and petrol engines even more efficient than they are now. The opportunities for progress are huge. For all the talk of electric vans, hybrids and engines that will run on hydrogen, the reality is that the vast majority of light commercials will be powered by highly-efficient petrol and diesel engines for many years to come. That said, we are ready to implement some of those alternative fuel technologies if required. PSA has already got some 10,000 electric vehicles in service around Europe, for instance. One of the difficulties with some of these technologies though is that the supporting infrastructure may not be there. The necessary tax incentives may not be there either and the customer may not be prepared to embrace what you are offering.
Volkswagen launched a purpose-built pick-up at the Hanover commercial vehicle show. Do you have any plans to follow suit and at last introduce a factory-built replacement for the long-gone 504 pick-up to the European market? I note that you were displaying an Expert pick-up converted by Durisotti at the show.
We don’t see a significant demand. But if demand does take off, then we’ll change gear.
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