Sime Darby out as French company looks to grow brand presence
French automotive giant Groupe PSA - the company that oversees the Peugeot, Citroen and DS brands - has signed a new distribution agreement with Inchcape in Australia.
Inchcape is the company that takes care of brands such as Subaru locally, so the move - Groupe PSA would undoubtedly hope - will see the French car brands see increased sales in a market where it currently struggles for relevance.
The new contract will see Groupe PSA and Inchcape work to import and distribute Citroen and Peugeot models to Australia from June 1, 2017, but a release from the French company made no direct mention of the future of the premium/luxury DS brand Down Under.
CarAdvice contacted Inchcape Australia for any word on the future of DS, but we can expect to learn more in the coming months ahead of the handover of the French brands. Rick Armstrong Motor Group will take over the New Zealand business.
Anecdotally, a CarAdvice reader made contact today to let us know a Citroen dealer had confirmed the new-look DS 3 (pictured above) will not be sold here.
UPDATE: CarAdvice understands there was another party in the mix for the business, too: Ateco Automotive - the former distributor of Citroen (at which point it was seeing record sales of its C4 Picasso model) and the company that introduced DS to the this market.
It is understood there wasn't an acceptable business case for that distributor to consider taking on the French brands - the numbers didn't make sense, apparently, and the contract period to rebuild the brands was too short.
The first all-new model to launch under Inchcape control will be the Peugeot 3008 SUV (pictured below), winner of the European Car of the Year for 2017 and a vital entrant in to one of the busiest sections of the local car market. It is understood the updated Peugeot 308 will also arrive this year.
Emmanuel Delay, executive vice president and head of the India and Pacific region, said the intent of the new deal was to "grow the presence of the Peugeot and Citroen brands in Australia".
"I am delighted to form this partnership with Inchcape Group, which brings distribution excellence to our brands and has a strong track record in Australia," Delay said.
"The timing is excellent as we are launching a strong product offensive. We are confident that, together, we will better meet the expectations of Australian consumers and improve our performance in the region."
Stefan Bomhard, Inchcape CEO, indicated the company is eager to show the quality of the vehicles to a broader share of the market than it currently has.
"Groupe PSA has performed exceptionally in the past few years and their product pipeline is exciting, relevant and offers great growth potential in the Australian market," he said.
The move to Inchcape comes at the expense of a distributorship deal with Sime Darby, which has been in control of Citroen and DS since early 2013 (formerly under Ateco Automotive) and Peugeot since October 2001.
A release from Sime Darby stated that the subsidiaries have "entered into assets sale agreements with the respective parties for the disposal of assets relating to Peugeot and Citroen businesses in Australia and New Zealand".
Patrick McKenna, Sime Darby Motors managing director for Australia and New Zealand said: “After careful consideration, a decision was reached to divest the Australasian distribution businesses.
"This is in line with Sime Darby Motors’ strategy to focus on the expansion of its retail car and commercial truck footprints on both sides of the Tasman. Once the decision was made, KPMG was engaged to conduct a full tender process for the sales on our behalf.
"Throughout the sale process it has been our priority to ensure that the vast majority of our employees in both countries would be offered employment under their existing terms and conditions. I would like to acknowledge this terrific group of people and wish them well in the future."
Over the years the brands have seen highs and lows in terms of sales, more downs than ups in recent years despite consistently improved product.
Peugeot dipped 21.8 per cent last year, after a consistent, and dramatic, sales slide since 2007 - it sold 8807 units then, but over a decade that number slumped to just 3129 units.
Citroen was down 12.7 per cent in 2016, a record sales year, while DS sales (bundled under the Citroen brand for reporting purposes) were down solidly too. If Citroen wants to succeed here, we'd expect to see the C5 Aircross (pictured above) as part of its line-up.
Stay tuned for more on this story as it develops in the coming weeks.