Maxime Picat: ‘PSA wants to make cars for everyone’
Many car manufacturers are struggling. Lately, their reaction to the different threats differ. In this article, we talk with Maxime Picat, since 2016 EVP at PSA and Operational Director for Europe.
Our rendezvous was scheduled for Geneva, but we finally talked on the phone. Of course, Maxime Picat couldn’t hide being exalted by the fact that ‘his’ Peugeot 208 was elected Car of the Year 2020. “I think that the fact that the car is proposed as a multi-energy car from the beginning was a clear message. It’s the key to its success.”
Not so long ago, PSA CEO, Carlos Tavares, was showing irritated by what he called ‘immobilism’ and the lack of vision of the authorities. Picat expresses this a bit more politely. “The problem with the abundance of rules and their financial consequences is that the car becomes a real luxury item.”
“PSA wants to make cars for everyone. A car is still a symbol of freedom. You have to look at the impact of all these measures on the car industry, and you have to be sure that a car that can be bought by all is still in the possibilities.”
Corona and China
The impact of the coronavirus changes almost every day, but until now, it has been reasonable regarding PSA. “Our factories are still producing, the impact until now is limited. Our factories in Wuhan are scheduled to restart on the 11th of March.”
“Of course, the impact can become worse when other parts of the world go in lock-down. I’m thinking of Italy, of course, in the first place. Until now, sales were down in the regions that were in quarantine, but we sold more in the other regions in Italy. Now, we will have to see what happens.”
One of the biggest flops for PSA the past years is the position in China. Instead of heightening sales and market share, PSA almost sells nothing anymore compared to a few years ago. Maxime Picat was working in China for PSA for many years before he came back to Europe at the end of 2012.
“Of course, we are not at all happy about what happened in China. As we are so small now, the impact on the group is limited, but we have to do things otherwise. DS, for example, has a future in China. DS 9, for example, is a car that is very well suited for China. We have to redevelop our position in this biggest of markets.
In the recent past, Peugeot was doing very well, Citroën has reinvented itself, and Opel is finally making money. But what about DS? “DS has a very recent history. Until now, we see that DS is doing very well in France, and it has a good start in other countries, like Belgium. But in others, DS is not known yet; we still have to build everything.”
“I have to warn you that DS is already making money at the moment. But, for sure, we have to improve everything. The biggest danger is that DS would become mainstream and become an internal competitor to Citroën and Peugeot. We have to be very vigilant in this.”
It can’t be easy to differentiate the four brands within the PSA Group, normally all the brands of Fiat Chrysler Automobile (FCA) will be joining reasonably soon. That must surely make things even more complicated.
“We are preparing the fusion, indeed. This takes a lot of work, we have installed so-called transversal working groups to look for the best way to do things. We have to think about synergies; we have to rethink our relations with the suppliers, we have to streamline our manufacturing apparatus without closing factories, etcetera.”
“You know, our recent client surveys gave us fascinating information. Potential buyers of PSA products are evidentially hesitating between ours and other brands. But they are practically never hesitating between PSA brands and FCA brands. They seem to be very different customers, and that’s excellent news.
“In fact, we have to see that our two base brands, Citroën and Peugeot, aren’t coming too close to each other. That’s why we are trying to differentiate them as much as possible, be it that the underpinnings are mostly the same.”
As a result of future fusion, the part of the Peugeot family in the new group will be halved. The Agnelli family will be the biggest shareholder. The Peugeot heirs are concerned about this.
FFP, the holding of the family, has announced this week it will buy additional shares of PSA. At the moment, FFP has 12,2% of the PSA shares, the same as the Chinese partner DongFeng and the French state. Once the fusion is a fact, the FFP share in the new company will automatically fall to 6,2%, where the Agnelli family will still have 14%.
While BPIFrance (the French state), as well as DongFeng, has he intention to diminish their part in the new entity, it is possible that the Peugeot family will take advantage of this. In January, one of the heirs, Jean-Philippe Peugeot, has reminded that the French state has no intention of staying much longer in the group’s capital.
FFP has diverse interests in a lot of companies. Some are active in the stock market; many others are entirely private. In total, FFP has an estimated value of approximately €2,1 billion. With this first operation of acquiring shares, the Peugeot family reaffirms it is still very interested in the car business.