PSA Peugeot Citroën and local partner Dongfeng Motor Group have launched an auto finance company in China in partnership with the Bank of China.
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The China Banking Regulatory Commission has authorised Dongfeng Peugeot Citroën Auto Finance Company (DPCAFC) to begin providing vehicle financing services in China.
Capitalized at RMB500m, the new finance company is owned by Bank of China (50%), Dongfeng Peugeot Citroën Automobile – DPCA – (25%) and Banque PSA Finance (25%).
It will provide wholesale financing for Dongfeng Peugeot and Dongfeng Citroën dealers and retail financing solutions for Chinese car buyers. Operations will begin in July in Beijing, before being extended nationwide.
The new joint-venture will enjoy the support of Bank of China’s financial backing and branch network, as well as the auto financing expertise of Banque PSA Finance, a PSA Peugeot Citroën subsidiary that operates in 18 countries in Europe and Latin America.
By strengthening Dongfeng Peugeot and Dongfeng Citroën’s marketing strategies, the successful start-up of financing operations is a major new stage in the development of DPCA, a joint venture between PSA Peugeot Citroën and Dongfeng Motor Group.
In 2005, DPCA sales rose 57.5% to 140,400 units from 89,100 in 2004, in a market that expanded by 24%. It expects to sell more than 200,000 vehicles in 2006.
To sustain this pace of growth, DPCA is strengthening its product line, with three new models to be launched in 2006 alone: the Peugeot 206 in March, the C4 hatchback-based Citroën C-Triomphe sedan in April and a new Citroën compact at year-end.
In addition, the company is implementing an ambitious capacity expansion program. After doubling capacity at the Wuhan plant to 300,000 vehicles a year by 2008, plans are now under way to find a new production site. The new plant’s location and construction schedule will be announced soon.
