Waiting on a Cactus: PSA Says It Has Once Chance to Get U.S. Re-entry Right

The long-awaited return of PSA Group — French builder of Citroën, Peugeot, and DS cars — to the U.S. marketplace was never going to be a quick operation. Americans weren’t going to suddenly wake up one morning to see neighbors Bob and Carol bundling the kids into in their brand-new Berlingo Multispace. Their other neighbors, Ted and Alice, wouldn’t suddenly arrive home in their Spacetourer and C-Elysee, jockeying for the parking space closest to the door.

The C4 Cactus, with its quirky Airbump inserts and 1.2-liter three-cylinder, won’t begin appearing in Walgreen lots overnight.

For PSA, returning to the U.S. is akin to a kid standing next to a cold pool, dipping one toe in first, then the foot, followed by the lower leg. To dive in without a plan would be to risk disaster. Having already established that first toehold (which you’d be forgiven for not noticing), the harder stuff awaits, and PSA remains cagey as to when we’ll all be driving around in Citroëns. It just knows it can’t screw it up.

“We have a chance to do this once, and only once,” said Larry Dominique, CEO of the fledgling PSA North America, at this week’s 2017 Center for Automotive Research (CAR) Management Briefing Seminars.

No pressure, surely.

In April, PSA North America brought the popular overseas TravelCar ride-sharing program to the Los Angeles and San Francisco airports, allowing travellers to borrow a stranger’s car for less than the cost of a rental. A stranger’s regular, non-French car, to be clear. The initiative, the product of a $16 million partnership with TravelCar and MAIF Group, is just the beginning.

A year prior, PSA CEO Carlos Tavares declared the automaker couldn’t call itself a global company without an American presence. It’s since crafted a 10-year plan to ensure it happens. However, dealerships and service centers don’t come cheap, so PSA plans to use technology and partnerships wherever possible to soften the financial blow.

“We will take advantage of new technology while keeping the values of a car company,” Dominique told the audience in Traverse City, Michigan, while admitting to the need for a crash course in how to operate as a new player in a large market.

In Europe, PSA now holds the title of second-largest automaker. Tuesday saw the completion of PSA’s purchase of General Motors’ Vauxhall and Opel brands, pushing the company past Nissan-Renault and closer to market leader Volkswagen Group. It knows Europe, but hasn’t stepped foot in the U.S. since Peugeot disappeared in 1991.

Knowing it can’t get too modern in how it offers its vehicles (Tesla products remain off limits in many states due to dealer franchise laws), PSA hopes to find help in getting its presence felt.

“We are looking for progressive, innovative and digital-minded partners,” Dominique said, adding, “I’m not prepared to talk about how we are going to come to market (in North America) but it will be practical, traditional and use technology.”

What sort of technology? According to Dominique, the automaker desires predictive technology to “determine market needs, second by second.”

Okay… Having proper inventory levels in different regions is nice, but it’s not the be-all and end-all. As for product, it’s no secret as to what Americans want. Crossovers. Not sedans, not even sports cars — crossovers. It’s possible U.S. buyers could also desire the quirkiness of a premium French automobile. Regardless, it’s clear PSA execs aren’t seeing visions of mondo profits arising from a U.S. foray anytime soon, hence the need to keep the budget down.

After its recent bailout by the French government and subsequent return to profitability, caution remains the name of the game.

[Source: Wards Auto] [Image: PSA Group]