Citroen gears up to enter India

French carmaker may set up shop in 2006.

Citroen, the second largest carmaker in France, is planning to enter India. "Citroen is coming to India, but we have not finalised the dates or the models," Citroen's India project manager, Inder Dua, told Business Standard.

Automobile industry sources said Citroen would establish its presence in India by the middle of next year. The sources also said dealers of premium cars in Mumbai and Delhi had already been sounded out on doubling up as Citroen dealers.

Citroen may participate in AutoExpo 2006, to be held in New Delhi next month, to showcase its products that are likely to be launched in India.

Market sources said the company would start operations by importing completely built units (CBUs) and subsequently move towards completely knocked down models before looking at manufacturing in India.

"Being a late entrant, Citroen may not be able to look at any big market share. The initial challenge will be to establish the brand name in the country," said an automobile industry analyst.

Citroen has a complete range of cars, starting from hatchbacks to premium sedans. Market sources said the lower-end cars would take a while to enter India if the company planned to take the CBU route to start with. Sources also said the higher-end cars"" the C4, C5 and the C6""might be retailed in India and used for building the Citroen brand in the country.

While the C4, C5 and the C6 will have to compete with the Mercedes C and S classes, the entry level models of Citroen match the Suzuki Swift and the Hyundai Getz.

Though Citroen sells in key Asian countries like China, Japan, Malaysia, Singapore, Sri Lanka and Thailand, and has a significant presence in West Asia, it does not have any presence in India, one of the fastest growing car markets in the world.

This is not the first time Citroen is contemplating entering India. In 2004, there was widespread speculation that the company was entering India.

Automobile industry sources disclosed that the Rajan Nanda-promoted Escorts group had held talks with the French car maker four years ago for a possible joint venture in India.