"Six hundred acres of land was not transferred to Peugeot due to some financial issues for its proposed integrated manufacturing facility in Sanand and the company will now be given land as and when they require it," state's Principal Industry Secretary M Sahu told PTI.
Making its re-entry into India, PPC had signed a State Support Agreement (SSA) with the Gujarat government to set up an integrated manufacturing facility at an investment of Rs 4,000 crore at Sanand near here. It had also laid the foundation of the project in November last year.
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 establishment of a total production capacity of 1,70,000 cars in the first phase of the project.
The state government's decision comes in wake of reports that the French auto major is reviewing its global expansion policy in wake of slowdown in Europe.
"PPC plans for Gujarat has been put on hold. It is not only for Gujarat, but the company is reviewing its entire global expansion policy, in wake of slowdown in Europe," Sahu said.
"Taking into account the European market crisis which impacts significantly the Group's cash flows and profitability, PSA Peugeot Citroen announced its intention to reschedule its project in India, and construction operations on the production facility in Sanand during its financial results on February 15, 2012," a company statement said. MORE
