Mitsubishi Motors Corporation CEO Takashi Nishioka and PSA Peugeot Citroën CEO Jean-Martin Folz on Friday signed a memorandum of understanding for a partnership on all-new SUVs. A final agreement will be completed by spring 2005.
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This memorandum plans the annual production in Japan of 30,000 units for PSA Peugeot Citroën’s needs, based on a Mitsubishi platform currently under development.
To be launched in 2007, these new SUVs will have specific design variations for the Peugeot and Citroën brands. Most will be powered the 2.2-litre PSA HDi diesel engine with particulate filter. Petrol versions will have a Mitsubishi engine.
These new SUVs will expand the Peugeot and Citroen ranges and targeted at new customers, predominantly in European markets, from 2007.
For Mitsubishi Motors, the additional volume will enable the company to raise capacity utilisation rates and to improve productivity. It will sell its own version of the new vehicle, described as an “SUV/crossover”, from the end of this year in Japan, 2006 in the US and 2007 in Europe.
The versions for the three brands will have unique front and rear end styling, colours and interior trims and badging, and the Citroen and Peugeot versions will have PSA’s own diesel engine – whether this will be offered in the Mitsubishi is still under discussion, though it would make sense, especially for vehicles sold in Europe.
To begin with, the Citroen and Peugeot versions will target European markets but the two groups are also considering the possibility of supplying other markets and expanding their partnership.
The new Mitsubishi SUV platform under development is for the redesign of the current Airtrek/Outlander crossover, sold in all of its major markets world-wide.
Spinnning off an additional 30,000 units for Peugeot and Citroen would give the beleagured automaker useful additional economies of scale, offsetting its falling sales in its key Japanese and US markets.
The deal makes a lot of sense for both firms because PSA has no experience in building currently-fashionable SUVs or crossovers, a segment it has never entered, while Mitsubishi is an old hand – the current Pajero/Shogun/Montero is the third generation and the Airtrek its first crossover.
PSA and MMC have previously worked together on petrol direct injection technology for Mitsubishi engines.
The two companies said today’s move was not the first step towards a global alliance.
“PSA pursues a strategy of organic growth. It made the choice of co-operations with other global independent car makers (no capital alliances). MMC does not seek a global alliance, instead, it pursues ‘win-win’ opportunities with collaborative partners,” they said in a statement.
PSA already builds diesel engines with Ford, shares van models with Fiat Auto, and builds a new small car in the Czech Republic with Toyota.
