New PSA Peugeot Citroën chief Carlos Tavares has set out plans for an acceleration of the group’s recovery based on cutting back the product portfolio and stepping up expansion in Asia.

Dubbed the “Back in the Race” plan, the financial aims of the roadmap include achieving a 2% operating margin in the operating division by 2018 (with a target of 5% during the next medium-term plan covering 2019-2023).

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As widely expected, the PSA group’s product line-up will be culled to save cost and focus new product development efforts in line with a clarified brand strategy. PSA said the group’s line-ups will be gradually streamlined to just 26 models by 2020 – around half of today’s number. By focusing on a more compact range, PSA said it will be able to improve market coverage and improve margins by targeting the most profitable segments.

PSA said that the development of the DS brand as a full-fledged premium brand will be stepped up as part of a strategy to reposition the three brands – Peugeot, Citroën and DS – while clarifying their line-ups to “ensure their complementarity” and improve price positioning.

As far as international operations go, the emphasis will be on exploiting the alliance with Chinese partner Dongfeng. PSA said the group will continue to accelerate its expansion in China, by tripling volumes with Dongfeng. It also said that the partnership signed with Dongfeng will also help to drive faster growth in the ASEAN region.

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At the same time, PSA said the group will “turn around the situation in Russia and transform the business model in Latin America, with the objective of returning to profit in the two regions in the next three years.

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In presenting the “Back in the Race” plan, Mr Tavares said: “With this Back in the Race plan, I am committed to accelerating the group’s recovery by channelling all of our teams’ creative potential so that we can quickly get back on the road to profit.” 

See also: GOLDING’S TAKE: Rule 1: never let a family run a car company