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You Need To Have About 90% Local Integration To Be In India: Citroen CEO

French carmaker Citroen is finally making its way into India after a lot of speculations for the last few years. The company has recently entered into a joint venture with the CK Birla Group for the Indian market and is setting up a manufacturing plant in Hosur, Tamil Nadu too. Part of the Groupe PSA, it also has a 50:50 joint venture with auto component manufacturer Avtec Powertrain, to produce engines 'Made in India', to be used in its cars for domestic and exports.

BusinessLine caught up with Linda Jackson, Chief Executive Officer, Citroën Brand, at Geneva International Motor Show to know about more. Edited excerpts: -

Finally Citroen is coming to India after a lot of speculations. Do you think it is the right time now?

Well, I think it was part of our push to pass through the plan, which was back in 2016, which was about after the company came back into profit, etc. And, we identified at that point that we needed to become more international and India was a natural market for us. We've been studying the Indian market and with which brand we should go there. So we signed up with our partners CK Birla where we are the majority holder, for assembly or manufacturing and distribution. And the second, which is with Avtec, which is for parts and engines, and gearboxes. So, over the past couple of years, we've been building each of those steps because everything that we do when we go into India, is going to be what we call scalable, which means that we want to build up slowly. We don't want to make any mistake because we want to remain in India and we want to be successful. Therefore, we need to be very careful.

So what products/ models are you planning to bring in India? There were reports you will be bringing the new C5 that you have showcased here at Geneva...

In terms of products, it's about having a unique styling and comfort as a key message because we are a brand, which is right in the heart of the mainstream, the core of the market. We also make sure that we are very close to our customers. So we want a very modern, fresh approach. Disruptive,you could say in some ways, in a positive way. India is a very complex market, and I have been there four times, but still learning a lot. I realize it's a very complex market, but it's also a growing market and there are some very strong domestic players. But, we believe the decision that we have made was towards unique approach - modern, fresh - not only in products but in services too. I cannot disclose the products yet, but we've already said that the first vehicles that will come will come before the end of 2021 and a product every year after that.

But, what segment do you think you can play stronger, especially when a lot of regulatory norms are changing there?

We will go into India with international models with modern technology, lesser CO2 (environment friendly) and obviously meeting the the Indian regulations which are very severe. Because, part of our strategy is that we have what we call it a model strategy, which is international models. So, our models must be sold in more than minimum two regions. We're seeing as a completely new adventure and I think that's important because we're coming in as a new brandLocalisation, adaptation to requirements are the only way that you can be successful because one of the things I learned in just four visits is that Indian customers want value for money. So we need to be very cost efficient in terms of how we produce vehicles and also robustness is another important aspect. That's why we need to have very high integration or local integration to be in India...you have to have something above 90 per cent local integration. But it's far too early to tell you which model. There will be a hybrid or electric which is also like waking up in the morning again and we need to look at what the market is like. I don't think electric at this stage is possible, I am not sure. Everybody tells me about the strength of diesel but clearly we would be looking to make sure that when I say technologies, it can be technologies not only in terms of engines but also in terms of comfort. Comfort is really an important part of Citron's DNA.

Do you think you will be able to build a brand in a country where many of them is hearing it for the first time, and many even finding difficult to pronounce it?

Well, I hope they would consider us to be first of all, a global brand but a global brand that is 100 years old. So, we have a history and we have a history that has always been about finding the solutions -innovative solutions with a unique designing and creativity. So, I hope they would recognise us as being a brand that has a heritage but a brand that always tries to find solutions for the future. And, a brand that is modern this fresh, and wants to be able to respond to our customers.

We just want to quite simply make our customers' lives less stressful and give them a nice easy experience. You know, to understand, we're inviting the dealers and asking them to spread the word. We want to come in and feel it like a home. You know wherever I go in the world and you need to tell me about India. Wherever I go in the world from Moscow to South America to China or wherever, may be its that positioning feeling that tells you that we're getting the results in terms of market share.

So, when we go into India, we have to make sure it's not just about the cars we're bringing in, but we have to have a level of after sales services that is right for customers. I know that's a very important part. And, I know that's why sometimes other manufacturers have also failed because they've not been able to provide the coverage. So we need to make sure that our distribution strategy includes ourselves and it's over the next year that we will be actually putting that in place in India.

What do you think of Electric cars and what feasibility do you see in the Indian context?

To bring in electric vehicles, we will bring out a plug-in next year, and I let all models that we launch will have an electric version from next year. But, I'm not sure that all of them making roads in every country. You have the infrastructure and it's certainly true for Europe. We can also produce these electric vehicles, but we've got to be able to use them as well. Hybrid is more easier, I think. For electric, it obviously depends on what distances, it's the usage the users want to see the usage. India is quite different market also, as I said and using them (electric) is particularly a challenging.

When you talk about the Indian market, you're talking about a couple of really big players (Maruti Suzuki India, Hyundai). So are those your primary competitors?

Well, again, that would be revealing the positioning that I'm going to be there. It's a little bit early to say where we will be positioning because obviously that depends on which products I bring in as well. So, you have to wait a little bit. I know Indians are very risk averse. We can not come into a market like that and compete against a domestic market that has 60-70 per cent of share by a few dominant players.

Source : The Hindu Business Line

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