Peugeot facility in Gujarat may face delays

French auto major PSA Peugeot Citroen today indicated there could be delays in commissioning of its proposed 650 million euro (Rs 4,000 crore) greenfield facility at Sanand, in Gujarat.

The company also announced that it is shifting base from Mumbai to Ahmedabad.

The second-largest European car manufacturer had proposed to roll out its first car from the Sanand plant -- the high-end C-segment model 508 -- in 2014 with the establishment of a total production capacity of 1,70,000 cars in the first phase of the project.

"PSA Peugeot Citroen is currently evaluating the scheduling of its project in India, which may lead to some adjustments to the schedule as it currently stands," a group spokesperson said in a statement.

"As a consequence of its agreement with the state of Gujarat, Peugeot will switch its offices from Mumbai, where they were set up during the early days of the project, to Ahmedabad, in Gujarat," it said.

The company had anticipated reaching full production capacity of 3,40,000 units by early 2016.

The company performed the ground-breaking ceremony for its integrated manufacturing plant here in November last year.

The Sanand plant is also proposed to have an engine manufacturing facility with a production capacity of 100,000 units annually.

The company had proposed that the Sanand plant would focus on the Indian market, though its output could also be exported to right-hand drive car markets like ASEAN nations and Australia.