RE: Re: Peugeot poised to become Europe's # 1 automaker

From: Bernard Kaye (eviebob@earthlink.net)
Date: Fri 05 Jan 2001 - 22:55:09 UTC

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    Leon, I guess the 607 is to replace the 605; what replaces the 505, does the 607 replace both the 605 and 505? I do not know but in NA, I think Peugeot would need a midrange as well as upper range (607 is expensive, I am informed) and lower range, such as rumored by Peugeot 307. Is there a 407 in works, 406 is old design for a comeback and 2 and 1 series are too small except for Austin-Cooper mini types who would salivate over a 206 but is there enough of a market for it here? I do not know but I do not forsee dealers taking on a brand with only 307 and 607. I have been so wrong, maybe again. Regards, Bernie

    ------Original
    From: "Leon" <leon.murphy@btinternet.com>
    To: Bernard Kaye <eviebob@earthlink.net>
    Sent: January 5, 2001 7:52:33 PM GMT
    Subject: RE: Re: Peugeot poised to become Europe's # 1 automaker

    The 607 is designed as a 507?!
    replacement for 605, which was replacement for 505/604!

    Leon

    -----Original
    From: Bernard Kaye [mailto:eviebob@earthlink.net]
    Sent: 05 January 2001 19:31
    To: fred smith
    Cc: peugeot-L@egroups.com
    Subject: Re: Re: Peugeot poised to become Europe's # 1
    automaker

    Fred, Dan and others, I agree with most of what you write with two comments:
    First, it is Peugeot who have said that they should be in North America or
    the United States to be a world competitor ( paraphrasing, I do not remember
    their exact wording); I have followed their expressed opinion and now offer
    mine, subject to change if circumstances change, therefore, Second: I agree
    that if they are successful in Europe, including Central Europe, the Mideast
    including Turkey, Africa, Central and South America, Asia-Australia-New
    Zealand with cars better for their needs than for North American needs, why
    risk the investment to come back to North America? It would require an
    interesting indeed document to convince an intelligent Managing-Supervising
    Board to make that investment; with a range of cars with a big mid-range
    gap. The cars that would fill that gap could sell here, would they sell in
    the other-world? The 607 could find well heeled buyers for its unique
    qualities, the 307 (discussed by others) might among enthusiasts as a 407
    (my imagination) might, but if Peugeot developed a 507 for the NA market,
    would it sell to their other markets or would it have to return a profit
    solely in NA? I do not know. And by the way, car buyers may not remember
    Peugeots and younger mechanics may not know of them, but I suggest the you
    mention the names Peugeot and Renault to a savvy U.S. car dealer and watch
    his eyes. Regards to all, Bernie

    ------Original
    From: fred smith <peugfan@juno.com>
    To: midvally@home.com
    Sent: January 5, 2001 6:36:25 PM GMT
    Subject: Re: Re: Peugeot poised to become Europe's # 1 automaker

    Thanks for saving me the effort. Remember - as I read in Road & Track
    decades ago - "American cars are made for people who hate to drive". Safe
    to say the Japanese are for the most part just following that example.

    fs

    On Fri, 5 Jan 2001 09:24:31 -0800 "Dan Midtdal" <midvally@home.com>
    writes:
    >This is a rant, those bothered by rants please hit delete now.
    >
    >I am bothered by the notion that somehow automobile manufactures must
    >be in
    >the USA to be a world player. This is an American view, the nation
    >with the
    >least traveled people in the world. Lets turn it around for a bit and
    >look
    >at it from the other side, how many vehicles does the USA and Canada
    >sell
    >outside of north America? Bloody few although I do not have the
    >numbers.
    >They don't sell many in Japan or Europe. Why? They can't sell
    >anything
    >except the more prestigious models where the purchasers don't care so
    >much
    >about the cost. There was a time when Desoto was a really big name
    >in
    >Turkey. In the late 60's the streets of Istanbul were clogged with
    >early
    >50's Desotos, Dodges,Chryslers etc.. The Turks liked the Desoto name
    >so
    >much they had a large truck named Desoto that was built there. Are
    >they
    >still driving 50's Desotos in Istanbul? I think not, they are more
    >likely
    >driving Peugeots. According to the Reuters article that appeared on
    >the
    >list on the 4th of Jan; Peugeot doubled its sales to 40,000 units
    >from
    >19,000 the year before. These are folks who could have but chose not
    >to buy
    >Toyotas or VW's.
    >In France, PSA's share of the French market improved, Renault's was
    >static.
    >Sales of PSA products rose 7% in 2000 and their shares are up 22%
    >since
    >October as "investors sought out companies with reliable
    >earnings...the
    >company has no sales in the US; so it is insulated from a slowdown
    >that's
    >prompted carmakers to slash output." So if ever there was a time for
    >PSA to
    >not be in the US this is it. Why should they consider returning to
    >a
    >country that is obsessed with the size of their SUV's and care nothing
    >about
    >fuel consumption. Peugeot has the product that it needs for global
    >expansion and has demonstrated in the last year by increasing their
    >sales
    >outside Europe by 33% Does that not make them a "world player"?
    >
    >The very notion that US consumers are the most demanding in the world
    >is
    >absolute crap! You only have to look at the vehicles with the
    >highest
    >sales. They come with nonexistent fuel economy, imprecise steering
    >and the
    >appeal of a washing machine. The early Hondas and Toyotas were not of
    >the
    >greatest quality but both companies learned what they had to do to
    >survive:
    >make more reliable vehicles. They have sold well in the States
    >because they
    >were a product that was affordable for many people to operate and gave
    >them
    >a driving experience. Japanese cars have not sold as well in Europe
    >because
    >the Europeans already had the products that they wanted with an
    >infrastructure to boot.
    >
    >Why should PSA return to USA when they are doing so well in the
    >markets
    >they have been developing throughout the rest of the world? The
    >reason
    >that Peugeot left the States in the first place was officially given
    >as
    >needing to preserve it's position in Europe against the Japanese
    >brands. I
    >think they have done that, Peugeot sold more vehicle in Europe in
    >1999
    > haven't seen 2000 figures) than all the Japanese brands combined and
    >is now
    >the most profitable auto manufacturer in Europe. Did they get that
    >way by
    >producing crappy poor quality cars? Perhaps our economist can explain
    >that
    >one in layman's terms. And the future? Peugeot has stayed the course
    >on
    >diesel engines when the Americans were rejecting them in all but their
    >super
    >duty trucks and now are poised for even bigger gains in sales at the
    >expense
    >of other manufactures. Is the day far off when Peugeot/Citroen sales
    >exceed
    >VW sales? Will PSA be Europe's number one Automaker? They were at
    >one
    >time, perhaps that is where they developed the arrogance that they
    >displayed
    >when they came to NA in the 50's
    >
    >I am glad they left formula one, I think that it went against the
    >grain of
    >what they were trying to achieve which was economy not high speed
    >racers
    >because there are such limited sales for such vehicles.
    >
    >BTW, I watched a report on the new Toyota Solara convertible on
    >Speedvision
    >last night and one of the big complaints was the' flexing'of the car
    >to
    >great excess. Gee, even the big guys get hit once in a while. They
    >liked
    >the coupe but not the convertible.
    >Regards,
    >
    >Dan
    >
    >Original
    >From: Bernard Kaye <eviebob@earthlink.net>
    >To: <Peugeot-L@egroups.com>
    >Sent: Thursday, January 04, 2001 10:06 AM
    >Subject: RE: [Peugeot-L] Re: Peugeot's standing "dans le monde
    >entier"
    >
    >
    >> Mike, Having a degree in economics, I agree with you that sometimes
    >it
    >gets theorized to death of common sense. Also, that Peugeot tends to
    >take
    >flight and not stay and fight when the going gets tough. The tough
    >get
    >going, Peugeot goes away. Example, when the second 604 that was
    >exported to
    >North America, enlarged to 2.8 liters with wonderful torque curve and
    >great
    >5-speed spacing (1979) to handle a/c (and three speed GM automatic)
    >was
    >rated at 12mpg city, (about 18-20 highway) Peugeot objected, fussed
    >and
    >withdrew the 604 gas, leaving only the Diesel. Perhaps other makers
    >would
    >have gone to fuel injection and more mpg as originally planned for the
    >604
    >and then used for the 505-V6. Or touted the wonderful drive,
    >acceleration,
    >and feel that comes from a powerful drive train that by necessity
    >requires
    >more fuel. Peugeot just quit, which may have been prudent for the
    >then
    >present but was not prudent for their future here. Their action was
    >against
    >interest because as good as the 505 was in certain respects, it was
    >no
    >Mercedes-BMW fighter in medium-full size cars as Mercedes thought the
    >604
    >was. By the way, the 12mpg city and 18-20mpg (memory) highway was
    >accurate
    >though at a steady 50-55, I could get 22mpg. Regards, Bernie
    >>
    >>
    >> From: [Unknown Sender]
    >> To: peugeot-L@egroups.com
    >> Sent: January 4, 2001 5:19:33 AM GMT
    >> Subject: [Peugeot-L] Re: Peugeot's standing "dans le monde entier"
    >>
    >>
    >> I tend to agree with Bernie's summation, although Brian does have
    >> some good points.
    >>
    >> However, most of the criteria Brian sets forth are very reminiscent
    >> of an economist's take on what's really important. I am an
    >> enthusiast first, although I am also conversant with economics.
    >>
    >> Please remember, above all, that economic criteria such as share
    >> value, ROI, output and reputation within the industry are by
    >> definition short-term, relatively epehemeral measures of worth.
    >> Economics has many failings, among which are its inability to
    >> effectively plan for even the meduim-term future. To illustrate
    >this
    >> point, consider the matter of discounting. Future revenues are
    >> discounted by, say 8%-10% per year in terms of their "present
    >value",
    >> to the point where, after 7 or 9 years, the future becomes
    >completely
    >> irrelevant to economists. That is, a revenue 8 years in the future
    >> has no present value (worth today). Of course this is a nonsense,
    >> but it is one of the main principles of classical economics.
    >> This "dismal science" is largely responsible for many of the
    >world's
    >> problems; I wouldn't consider it, on its own, to be a sound
    >> foundation for predicting the long-term future of any enterprise.
    >>
    >> So, what is lacking in Brian's list is more of the things that I
    >> value, related more to car ownership and enjoyment than pedagogical
    >> abstractions or investment counselling:
    >>
    >> -bulletproof reliability (see Toyota and others)
    >> -excellence in chassis design (PSA's been slipping here of late)
    >> -very good build quality (could be better)
    >> -superb ride (formerly a Peugeot hallmark)
    >> -very tough, super-robust drivetrains (not really possible with
    >FWD)
    >> -design flair, beauty (a mixed bag, ranging from the 406C to the
    >106)
    >> -"je ne sais quoi", the intangible benefit of owning a particular
    >car
    >>
    >> Then there are some other management issues, among which are:
    >>
    >> -aggressive management (not really, but it can get you into
    >trouble)
    >> -no fear of tough competition (they SHOULD be in USA, NOW!!!)
    >> -positive attitude towards customers (it's not in the French
    >psyche)
    >> -good understanding of marketing (a mixed bag here)
    >> -serious long-term committments to each market (I can dream can't
    >I?)
    >>
    >> The reason that Peugeot cannot be a "world player" until they have
    >> more than a token presence here is that the US market is without a
    >> doubt the world's most competitive. I think Peugeot is literally
    >> scared to death about all the US consumer protection laws, class
    >> action lawsuits, warranty insurance costs, etc, and scared by the
    >> abilities of their potential competition over here. This is,
    >without
    >> a doubt, the reason the US 605 was axed - they would have been in
    >an
    >> Audi 5000 situation with that car and it would have wounded them
    >> badly. Although there is some evidence that their recent models
    >have
    >> improved, they are still average at best. This is not enough, they
    >> have to strive to be better. Selling cars here would help in that
    >> process, although getting there will be painful.
    >>
    >> Their current aggressive expansion is aimed at the Third World.
    >Yes,
    >> those markets are growing. But they are immature, and subject to
    >> more volatility. Also, the "consumers" (formerly known
    >> as "citizens", or "people") in these countries are not very
    >> demanding, to be quite frank. If PSA is successful in this, and
    >> these countries become PSA's main export market, don't you think
    >> their customers in Europe might wonder in ten years' time why they
    >> won't (or can't) sell a car in the USA, where customers are the
    >most
    >> demanding in the world? What would Peugeot's marketing slogan
    >> be? "Buy a Peugeot, the official car of the Third World"?
    >>
    >> Participation in the US market sharpens competitive skills, demands
    >> very high engineering and management skills and prepares companies
    >> for any challenges elsewhere in the world. I've got to hand it to
    >US
    >> people, they don't take shitty or even average products lying down.
    >> Western Europe is far behind here: Scandinavia and Germany are the
    >EU
    >> areas with the most advanced consumer laws/civil movements, and the
    >> German Gov't still won't allow companies to offer standard
    >warranties
    >> exceeding 3 years (most are 1 year, 20,000 km!!), as it would be
    >> an "unfair competitive advantage". BMWs and Mercedes have one year
    >> warranties in their home markets; welcome to the 1960s! France
    >lags
    >> behind Germany in consumer law and awareness. And it is the
    >> company's stronghold.
    >>
    >> Citroen will never be the same as it was in the 1960s - modern
    >> markets don't allow for engineer's dreams to be built any more.
    >> There is precious little room for unprofitable, over-engineered
    >cars
    >> these days. That's what almost sank Citroen in 1974 (and 1934, for
    >> the historically inclined). The new Citroens will be innovative in
    >> a "new Beetle" kind of way, but like the Beetle, more or less a
    >mere
    >> shadow of their former selves. The market wouldn't allow it to be
    >> any other way.
    >>
    >> Another comment: I just can't accept that VALEO is a "top-notch
    >> supplier". I've paid too much money to those "salauds" in
    >> replacement parts to believe it! Mikey's Postulate on VALEO: I
    >think
    >> that they designed barely-adequate (crap) products on purpose, low-
    >> balled the manufacturers with a super-cheap loss-leader contract,
    >> intending all along to make all their profit by selling
    >replacements
    >> for the crap OEM stuff that breaks prematurely. Seriously.
    >>
    >> Brian, please don't laugh at the Prius. It may be ugly, but we'll
    >> all be driving something like it in 15 years. Where is Peugeot
    >with
    >> the innovative hybrids? A few electric vehicles in municipal
    >fleets
    >> and for wealthy Parisians won't cut the mustard. You know why
    >Honda,
    >> Toyota, Mercedes and Ford are ahead on alternative fuels? Mainly
    >> because of California's CARB regulations.
    >>
    >> Having written all that, I hope that PSA has an epiphany and comes
    >> back to the USA and Canada. Because it is a healthy presence here
    >> that will ensure their continuation over the long term. And I'd
    >hate
    >> to lose another of the world's oldest manufacturers.
    >>
    >> Regards,
    >> Mike Tippett
    >>
    >>
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