PSA to Split with Changan and Capsa in China – An Omen for Citroën?

PSA announced last Thursday that it is readying to sell its 50% stake in its Chinese partnership with Changan (Chongqing Changan Automotive) which builds cars under PSA’s DS brand. Changan had already signalled in regulatory filings from early November that it was seeking a buyer for its half of the venture that was set up in 2011 and has struggled with falling sales.

PSA is also looking to sell out of the venture, known as Capsa, a spokesman confirmed, saying that it would still look to roll out DS in China, without giving further details of how. “That does not change anything regarding DS’s presence and development in China, a new strategic plan will be presented in the coming weeks or months.” PSA’s sale plan for the joint venture, which operates a factory in Shenzhen, will be presented to French unions on Friday, a source familiar with the matter said.

This regrouping for DS in China may be telling of Citroën’s future there, and possibly abroad, as the brand competes with both local and foreign manufacturers for the mainstream market below the segment targeted by DS.

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