JD>----------
JD>From: Justin Dukess[SMTP:Jdaniel@concentric.net]
JD>Sent: Thursday, November 28, 1996 7:30 AM
JD>To: 'cwi'
JD>Subject: RE: Hi!
JD>Eugene,
JD> I don't know what is going on with that. www.frenchrev.com has some
info.
JD>Thanks for visiting
Dear Justin;
Peugeot is certainly no SAAB. Peugeot is larger and more profitable than
the Chrysler, it makes more cars than, for example, Chrysler with all
its brands combined (like Jeep, Eagle, Chrysler, Plymouth, Dodge, etc).
PSA is the third largest automotive and engineering group in Europe. In
countries like Germany or Austria (the last one has absolutely free car
market, no quotas or anything), both known in the US as very quality
conscious nations, Peugeot outsells Nissan, Toyota, Daihatsu, Mitsubishi
and North American made Buck, Chrysler, Dodge, Jeep, Plymouth,
Chevrolet, Pontiac, Cadillac and all Korean manufacturers COMBINED.
Peugeot also outsells all American made cars in Japan, another quality
conscious market. The group (PSA) is very active (and will certainly
grab a very large chunk of the market)in Southeast Asia, China and
India.
However, I think for some reason, Peugeot was never overly enthusiastic
about the US market. I really don't know why. Perhaps, from the very
beginning, they considered it to be a lost cause because of incredible
prejudice and wild stereotypes of everything French in the US. I've just
returned form a trip throughout the UK, Germany and Austria (I also
lived in Austria for two years), where admittedly stereotypes are
reverse. French means good taste and good quality while American (and
sometimes even the Japanese) means the opposite with the emphasis on
(bad) quality and (bad) engineering. If it is so, they were possibly
right: all French companies that achieved enormous success in North
American market in the technological field did everything possible to
hide the fact they are French -- like Danone who under name of Dannon
controls most of US processed dairy market, Schlumberger (a huge oil
equipment company which generates 90% of its revenue outside of France,
mainly in North America), BIC (razors and stuff), Michelin, Fischer,
Thomson (Cyrix and IBM microprocessors, General Electric consumer
electronics, Zenith data systems, RCA equipment), etc., or these
companies operated in areas where they did not have to be in touch with
the stupid public: Airbus Industrie (French assembled airliners), ATR
(passenger/commercial aircraft), Aerospatiale (Coast Guard and US Marine
Corps' helicopters, missiles and missile guidance systems); or, lastly
where the "stereotypes" played to their advantage: cheese, wine or a
company like Perier. I can't imagine how could possibly Peugeot hide the
fact that they are French in the US, where mass public sees everybody
in almost Hitleresque stereotypes: Canadians live in dark, cold forests,
the French wear berets, are cowards (?) and ride bycicles, the Germans
are "good mechanics," Japanese are delligent, Irish are drunks, Dutch
eat cheese all the day long and look at windmills, etc.
I think Peugeot could have made it in America. I think they still have a
potential to sell about 30,000 vehicles or more per year in the United
States. They main mistake (besides pathetic marketing) was concentration
on mega dealerships which sold many products besides Peugeot and who had
no loyalty to Peugeot. Their second major mistake (or was it their first
one?) that unlike the Japanese, they only offered a very limited number
of models in the US. At some point, they were only selling 505's in the
US. Elsewhere, they offered (and still offer!) a full range of models
--- from micros (106), subcompacts, compacts, etc. to vans and delivery
trucks. Their marketing was also bad, aimed at nobody,
If Peugeot is to reenter North America, they should find a partner (and
again they were looking in the wrong place), most likely in Canada,
where they could make vehicles at the lower cost than in the US but
exported to the US duty free with most of the risk cushioned or shared
with the partner: like Bombardier, Ltd and the province of Quebec.
Thanks.
Eugene Soukharnikov
cwi@bdol.com
Providence, RI